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The University of Southampton
Courses

LAWS6176 International Trade Finance

Module Overview

In every contract for international sale of goods, the trading parties need to agree a method of payment. The way of payment in fact represents the reconciliation between the conflicting interests involved in international trade transactions. The seller’s interest is to obtain the payment as soon as possible, ideally before parting with the goods or at least the documents which can control the goods. The buyer, on the other hand, wishes to postpone the payment as late as possible, even until realisation of money by reselling the goods. To achieve a reconciliation of these conflicting interests, the interposition of banks as an intermediary is often necessary. This course covers the law on various financial instruments commonly used in international trade transactions, in particular letters of credit, which have been described as the life-blood of international commerce.

Aims and Objectives

Learning Outcomes

Knowledge and Understanding

Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:

  • The legal sources on the main payment methods used in international trade transactions.
  • The legal principles governing letters of credit and links with international commodity sale contracts.
Subject Specific Intellectual and Research Skills

Having successfully completed this module you will be able to:

  • Analyse relevant legal materials, including case law and relevant standard terms.
  • Identify and explain the contractual principles underpinning the law relating to letters of credit.
  • Apply the legal principles, with appropriate legal authorities, in the solution of complex problems.
  • Assess existing areas of debate about what the law is and what it ought to be, by using appropriate legal research skills.
  • Locate and analyse relevant legal and other primary and secondary source materials including international standard banking practice.
Transferable and Generic Skills

Having successfully completed this module you will be able to:

  • Distinguish relevant from irrelevant materials.
  • Identify and analyse key issues.
  • Think critically, develop coherent arguments in writing.
  • Display clarity and objectivity in written discussion demonstrating an awareness of issue of academic integrity.

Syllabus

The following is an indicative list of the module content: • Methods Financing International Sale of Goods • The Use of Bills of Exchange • Fundamental Principles in Letters of Credit • Relationship between Letters of Credit and International Sale Contracts • Document Examination and Rejection under Letters of Credit • The Role of Shipping Documents and Bank’s Security • Demand Guarantees

Learning and Teaching

Teaching and learning methods

This module is taught through lectures (8x2hours) and seminars (3x2hours). Lectures will introduce the principles and structure of the subject. You are expected to provide the main input to the seminars where the principles introduced in the lectures are applied to hypothetical scenarios. The most important part of learning is your own independent study. This will, however, be closely guided, and firmly tied into the lectures, seminars and assessment. In the seminars you will have the opportunity to present arguments orally to a group of peers and defend your position under challenge.

TypeHours
Blended Learning22
Independent Study128
Total study time150

Resources & Reading list

A. Malek & D. Quest (2008). Jack: Documentary Credits . 

M. G. Bridge (2017). Benjamin’s Sale of Goods . 

Assessment

Formative

Coursework

Summative

MethodPercentage contribution
Essay or problem question  (24 hours) 100%

Repeat

MethodPercentage contribution
Essay or problem question  (24 hours) 100%

Referral

MethodPercentage contribution
Essay or problem question  (24 hours) 100%

Repeat Information

Repeat type: Internal & External

Costs

Costs associated with this module

Students are responsible for meeting the cost of essential textbooks, and of producing such essays, assignments, laboratory reports and dissertations as are required to fulfil the academic requirements for each programme of study.

In addition to this, students registered for this module typically also have to pay for:

Textbooks

Recommended texts for this module may be available in limited supply in the University Library and students may wish to purchase them as appropriate. All recommended sources, apart from the main book, are available to students free of charge, either on the Internet, or on Blackboard, or on the legal databases. From the choices of possible mandatory texts e.g. Paul Todd, Cases and Materials on International Trade Law (Sweet & Maxwell, 2002) £45

Please also ensure you read the section on additional costs in the University’s Fees, Charges and Expenses Regulations in the University Calendar available at www.calendar.soton.ac.uk.

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