A、rEDClAusEDoCumEntAryCrEDit is ADoCumEntAryCrEDit with A spECiAl ConDition inCorporAtED into it thAt AuthorizEs thEConFirmingBAnk or Any othEr nominAtEDBAnk to mAkE ADvAnCEs to thEBEnEFiCiAry BEForE prEsEntAtion oF thE DoCumEnts. thE ClAusE is inCorporAtED At thE spECiFiC rEquEst oF thEAppliCAnt, AnD thE worDing is DE- pEnDEnt upon his rEquirEmEnts. thE rEDClAusEDoCumEntAryCrEDit is so CAllED BECAusE thE ClAusE wAs originAlly writtEn in rED ink to DrAw AttEntion to thE uniquE nAturE oF thisDoCumEntAryCrEDit. thE ClAusE spECiFiEs thE Amount oF thE ADvAnCE AuthorizED, whiCh, in somE in- stAnCEs, mAy BE For thE Full Amount oF thEDoCumEntAryCrEDit. thE rEDClAusEDoCumEntAryCrEDit is oFtEn usED As A mEthoD oF proviDing thE sEllEr with FunDs prior to shipmEnt. thErEForE, it is oF vAluE to miDDlEmEn AnD DEAlErs in ArEAs oF CommErCE thAt rEquirE to A Form oF prE - FinAnCing AnD whEn A BuyEr woulD BE willing to mAkE spECiAl ConCEssions oF this nAturE. For ExAmplE, it CoulD BE usED By A wool importEr inEnglAnD to EnABlE A wool shippEr inAustrAliA to oBtAin FunDs to pAy thE ACtuAl suppliErs (EithEr By DirECt purChAsE or through thE wool AuCtions) By oBtAining A loAn From thEAustrAliAn BAnk, EithEr on An unsECurED BAsis or AgAinst thE sECurity oF intErim DoCumEnts. this woulD EnABlE rEpAymEnt oF thE loAn, plus intErEst, From thE proCEEDs DuE to thEAustrAliAnBEnEFiCiAry whEn thE wool wAs shippED AnD DoCumEnts wErE prEsEntED in ACCorDAnCE with thE tErms oF thEDoCumEntAryCrEDit. iF, howEvEr, thEBEnEFiCiAry FAilED to ship thE wool so As to rEpAy thE loAn By prEsEnting DoCumEnts CAllED For By thEDoCumEntAryCrEDit, thEAustrAliAn BAnk woulD hAvE thE right to DEmAnD rEpAymEnt, with intErEst, From thE issuingBAnk AnD thAt BAnk woulD hAvE A similAr right oF rECoursE AgAinst thEAppliCAnt. this kinD oF ArrAngEmEnt plACEs thE onus oF FinAl rEpAymEnt on thE AppliCAnt, who woulD BE liABlE For rEpAymEnt oF thE ADvAnCEs iF thEBEnEFiCiAry FAilED to prEsEnt thE DoCumEnts CAllED For unDEr thEDoCumEntAryCrEDit, AnD who woulD Also BE liABlE For All Costs--suCh As intErEst or ForEign ExChAngE hEDging-- inCurrED By thE issuingBAnk, thEConFirmingBAnk, iF Any, or Any othEr nominAtEDBAnk.

whAt DoEs A rEDClAusEDoCumEntAryCrEDit mEAnA．it is A kinD oFDoCumEntAryCrEDit with A spECiAl ConDition inCorporAtED into it thAt AuthorizEs thEConFirmingBAnk to mAkE loAns to thE sEllErs prior to shipmEnt.
B、it is ADoCumEntAryCrEDit without rECoursE As A "ConFirmingBAnk" to thE issuingBAnk, whiCh ClEArly DiD not rEquEst or AuthorizEs thE BAnk to "ADD its ConFirmAtion".
C．it is ADoCumEntAryCrEDit with A spECiAl ConDition inCorporAtE into it thAt AuthorizEs thEConFirmingBAnk or Any othEr nominAtEDBAnk to proviDE thEBEnEFiCiAry with FunDs BEForE prEsEntAtion oF thE DoCumEnts.
D．it is ADoCumEntAryCrEDit thAt mAy proviDE For AutomAtiC rEinstAtEmEnt immEDiAtEly upon prEsEntAtion oF thE spECiFiED DoCumEnts.