• Journal of Korea Trade
• /
• v.24 no.7
• /
• pp.73-92
• /
• 2020

Purpose - The letter of credit has been playing a major role to diminish overall risks which exist among concerned parties even though there are differences such as language, culture, law, and distance. This paper reviews essence of the letter of credit and its transaction principles, as well as overall practical questions based on the L/C transaction principle. It also investigates the risk of fraud occurrences in L/C transactions and the importance of fraud prevention and preventive measures in international L/C transactions, including the Fraud Rule, which is a major topic to consider in business transactions. Design/methodology - It is considered that an importing country's concerned parties and an exporting country's concerned parties face different situations. This study employs the existing framework to identify liability, responsibility, and obligation for all concerned parties across countries. Using a quite direct measurement of principles in the letter of credit, such as principle of independence, principle of abstraction, and principle of strictness and coincidence, we studied these differences. Findings - Our main findings can be summarized as follow. The paper enhances the efficiency of the L/C payment method to provide fraud generated from L/C transactions, presentation of a theoretical framework about fraud and fraud prevention, which international trading companies should acknowledge in a material way based on fraud risk resulting from taking advantage of L/C transaction principles. Originality/value - Existing studies focus on fraud accidents in L/C transactions by taking bad advantage of the characteristics of the letter of credit without suggesting risks of fraud. This paper attempts to evaluate and provide preventive measures as a solution for fraud and risky international business in a letter of credit transaction. This area of trade studies is underexplored, both empirically and theoretically, although the issue has long been important to Korean and world community foreign trade.

• Journal of Legislation Research
• /
• no.41
• /
• pp.201-228
• /
• 2011

In 97hu2200, the Supreme Court of Korea suggested five requirements to apply the doctrine of equivalents, i.e. identity of problem-solving principles, interchangeability, ease of interchangeability, exception of known arts and file-wrapper estoppel. There have been arguments on whether the standard of ease of interchangeability could be regarded as the same as the obviousness standard in deciding patentability. The side who thinks that they are different (hereinafter, the side of difference) considers that the standard of ease of interchangeability is narrower than the obviousness standard. This side criticizes the side who thinks that they are the same each other (hereinafter, the side of the same) on the reason that doctrine of equivalents can be overly expanded. On the other hand, 'the side of the same' argues that every accused invention having no inventive step from the perspective of the patented invention should be considered to infringe. 'The side of the same' points that if the standard of ease of interchangeability is considered as narrower than the obviousness standard, 'grey area' should exist where the patent law cannot work. The difference between the two side may cause contradictory results in the decision of infringement under the doctrine of equivalents. Because 'the side of difference' construes claims narrowly than 'the side of the same,' an accused invention in the grey area is not regarded to infringe. 'The side of the same,' however, considers the accused invention to fall into the scope of the patent under the doctrine of equivalents. This paper concludes that the standard of ease of interchangeability should be regarded as the same as the obviousness standard from the perspective of economics of innovation.