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The ICC Banking Commission met in Paris on
23 and 24 October. As usual there was an assortment of
issues that made up the Opinion requests. Before looking
at the main points of the Opinions, and their
conclusions, the first topic for discussion was the
cases that had been decided under the DOCDEX process
following the last meeting of the Commission. There had
been 6 cases heard and decided upon, of which 4 related
to UCP 500. There were three themes focussed on in the
decisions - 2 cases related to issues where the credit
had been transferred, 2 cases where non-bank issuers had
failed to refuse documents according to the requirements
of UCP and 2 cases relating to banks failing to refuse
according to the requirements of UCP.
It
was also mentioned in the meeting that due to a number
of retirements of members of the Banking Commission and
people moving to different positions within their
organisations, there was a need for more experts to
enrol in the DOCDEX process. Any person that believes
that they possess the necessary qualifications i.e.,
full understanding of the principles and application of
UCP, URC, URR and URDG, should forward their CV to their
local ICC national committee for their consideration and
if the national committee is satisfied to recommend that
person to ICC HQ, a recommendation should be sent to the
ICC Centre for Arbitration for their further
consideration.
There were 16 Opinions discussed
at the meeting.
The first Opinion to be
discussed focussed on two issues.
1. Whether a
CMR was acceptable showing two carrier names.
2.
Whether the insertion of the day of the month of the
shipment, by pen, was acceptable when the rest of the
date i.e., month and year were typed onto the CMR.
The CMR showed, in box 16 (titled: Transporteur) the
name of Company S and in box 23 (titled: Signature et
timbre du transporteur) the name and address of Company
C. The presenting national committee had offered their
own analysis and conclusion to the query and determined
that the document was discrepant. The Banking Commission
agreed with this position.
The CMR showed in
boxes 4 (date of taking in charge) and 21 (date of
issuance) ".... -11-2007" and had been completed, in pen,
with the addition of "28". The presenting national
committee had differing views as to whether or not this
was acceptable. The Banking Commission took the view
that the document had been created on the basis that the
actual day would be inserted later; that it would be
acceptable according to the content of ISBP paragraph 11
and would not require authentication by the carrier or
their agent.
See Opinion TA.657 (rev) for the full
transcript of the above
Opinion.
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The
next Opinion to be discussed was the misquoting of a
credit number on the bill of lading where the issuing
bank had itself misquoted the LC number within their own
credit.
The view of the Banking Commission was
that the misquoting of the credit number for this query
was not a reason to refuse. It should be noted at this
point that each Opinion given to an enquiry is clearly
marked that the analysis and conclusion is based on the
facts provided in the query. Therefore, the answer given
to any query may or may not apply in every instance.
See Opinion TA.658 for the full transcript
of the above Opinion.
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A number of credits were issued
stating that all banking charges except LC opening
charges were for the account of the beneficiary. The
credits did not specify the amount or percentage of
those charges. The beneficiary shipped the goods and
presented documents. The issuing bank deducted over
USD1000 from a number of drawings under these credits.
Was the issuing bank entitled to make such a deduction
where they had not indicated the level of fees? This was
the question before the Banking Commission. Issuing such
a credit without specifying the amount or percentage of
the charges was seen as a bad practice on the part of
the issuing bank. The conclusion reached by the Banking
Commission was that if the issuing bank wishes to make a
deduction of their fees then the credit must clearly
indicate the level of those fees so that the beneficiary
may make a decision as to whether to perform under the
credit.
See Opinion TA.659 (rev) for the
full transcript of the above Opinion.
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An
issuing bank refused documents, under a UCP 500 credit,
due to the reason that the certificate of origin showed
the weights as "78880 kg net / 71920 kg gross" whereas
other documents stated "71920 kg net / 78880 kg gross".
The initiator of the query requested confirmation that
the transposing of the weights would constitute a simple
mistake and not a reason for refusal. The Banking
Commission agreed with this view. The conclusion to the
query includes "it is not possible to have a net weight
that is greater than the gross weight of the same
goods".
See Opinion TA.660 (rev) for the full
transcript of the above
Opinion.
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Questions
relating to the issuance of drafts formed the basis of
the next Opinion. If the credit was available at 90 days
sight with any bank or a specific nominated bank, on
whom should the draft be drawn? The answer given
reflected that if it is the specific nominated bank then
it should be drawn on that bank if they agree to act on
their nomination. If the credit is available with any
bank, the draft must be drawn on the bank that agrees to
act on the nomination to accept the draft. The last
question was whether a draft drawn on the issuing bank
could be accepted by a nominated bank. Whilst it was
recognised that it may be possible, in some
jurisdictions, for a draft to be accepted by a different
party to that on whom it is drawn, the answer reflects
the position under the UCP and documentary credit
practice i.e., if the draft is to be drawn on the
issuing bank, then the credit should be available by
negotiation and not acceptance. The nominated bank will
negotiate the draft and the issuing bank will accept it.
See Opinion TA.661 (rev) for the full
transcript of the above
Opinion.
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The next request focussed on charter party
bills of lading and the UCP rule of "contain no
indication that it is subject to a charter party". Three
examples were provided of marine bills of lading that
bore (1) "Issued pursuant to charter party dated ...." [no
date inserted], (2) "freight payable as per charter
party" and (3) the title "charter party bill of lading".
In all 3 examples, the documents otherwise fully
complied with article 20. The question was whether these
three statements were an indication that each bill of
lading would be considered to be a charter party
document. The answer of the Banking Commission was yes
to all 3 examples. The Commission was mindful of the
fact that to try and draw different viewpoints on
different manners of statements could lead to confusion
for document examiners and the position taken should be
one of "any indication of a charter party = a charter
party document for the purposes of UCP 600".
See Opinion TA.662 (rev) for the full
transcript of the above Opinion.
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A credit required an inspection services
certificate indicating that the goods were of 'crop year
2007'. The presented document evidenced "applicant
states that this is from the crop year 2007". Was the
document acceptable? The view of the Banking Commission
was yes.
See Opinion TA.663 (rev) for the
full transcript of the above Opinion.
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The
last Opinion to be reviewed in this newsletter was in
relation to a credit that stated "all corrections must
be authenticated by the issuer of the respective
document". The query highlighted a number of scenarios
including one where the invoice that had been certified
by a chamber of commerce bore a correction. The
correction was approved by the chamber of commerce but
not the beneficiary. The Banking Commission decided that
the invoice would require authentication by both the
beneficiary and the chamber of commerce.
See Opinion TA.664 (rev) for the full
transcript of the above Opinion.
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The next newsletter
will contain the remaining Opinions that were discussed
and approved at the ICC Banking Commission
meeting.
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