Issuing bank has reason to refuse payment

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On July 10, a foreign trade company has signed a sales contract (CIF) worth 150,000 USD with foreign investors, and the payment shall be made through irrevocable letter of credit. The contract provided for our goods should be shipped out in August. On July 28, Bank of China informed the company that it had received letters of credit from the other parties issued by foreign banks. And the audition found that the letter of credit terms and the terms of the contract are consistent with each other. However, before shipment, the company received a modification of the letter of the credit, asking the seller to make the shipment before August 15. As the trade company has booked a liner to sail on August 25 and temporary change procedures are cumbersome, the modification of the letter has been ignored. And it had made the shipment and negotiation for the payment according to the original letters of credit, and then submitted the full set of documents to the issuing bank. But the issuing bank refused to pay on the grounds that the Shipping documents are inconsistent with the modification of the letter of the credit.

Please analyze whether the issuing bank has the reason to refuse payment.

Reference no: EM131318832

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