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Copyright © International Chamber of Commerce (ICC). All rights reserved.
( Source of the document: ICC Digital Library )
by Dan Taylor
The revision of UCP 400 was undertaken differently from prior revisions. Initially, two working groups were created, one to look at the UCP’s transport articles and the other to look at the remaining articles of the UCP. The working group reviewing all the articles other than transport examined all of the legal cases worldwide involving UCP 400. After the initial review, the two groups were combined and given the task of finishing the revision. The overall goals of the revision were to strengthen the obligation of the issuing and confirming banks and to update the rules for the rapidly changing transport industry.
The significant changes in UCP 400 were:
For a complete detailed comparison of the 1983 UCP and 1993 UCP refer to UCP 500 & 400 Compared: An Article-By-Article Detailed Analysis of the New UCP 500 Compared with the UCP 400, authored by Charles Del Busto and published by the ICC (Publication No. 511).
It is worth noting that immediately following the revision the ICC Banking Commission issued four Position Papers, something that had not been previously done, to attempt to correct a number of misinterpretations of UCP 500. These Position Papers are reprinted following the text of UCP 500.
ICC Publication No. 500
A. GENERAL PROVISIONS AND DEFINITIONS
Application of UCP
The Uniform Customs and Practice for Documentary Credits, 1993 Revision, ICC Publication No. 500, shall apply to all Documentary Credits (including to the extent to which they may be applicable, Standby Letter(s) of Credit) where they are incorporated into the text of the Credit. They are binding on all parties thereto, unless otherwise expressly stipulated in the Credit.
Meaning of Credit
For the purposes of these Articles, the expressions “Documentary Credit(s)” and “Standby Letter(s) of Credit” (hereinafter referred to as “Credit(s)”), mean any arrangement, however named or described, whereby a bank (the “Issuing Bank”) acting at the request and on the instructions of a customer (the “Applicant”) or on its own behalf:
against stipulated document(s), provided that the terms and conditions of the Credit are complied with.
For the purposes of these Articles, branches of a bank in different countries are considered another bank.
Credits v. Contracts
Documents v. Goods/Services/Performances
In Credit operations all parties concerned deal with documents, and not with goods, services and/or other performances to which the documents may relate.
Instructions to Issue/Amend Credits
B. FORM AND NOTIFICATION OF CREDIT
Revocable v. Irrevocable Credits
Advising Bank’s Liability
Revocation of a Credit
Liability of Issuing and Confirming Banks
Types of Credit
Teletransmitted and Pre-Advised Credits
Incomplete or Unclear Instructions
If incomplete or unclear instructions are received to advise, confirm or amend a Credit, the bank requested to act on such instructions may give preliminary notification to the Beneficiary for information only and without responsibility. This preliminary notification should state clearly that the notification is provided for information only and without the responsibility of the Advising Bank. In any event, the Advising Bank must inform the Issuing Bank of the action taken and request it to provide the necessary information.
The Issuing Bank must provide the necessary information without delay. The Credit will be advised, confirmed or amended, only when complete and clear instructions have been received and if the Advising Bank is then prepared to act on the instructions.
C. LIABILITIES AND RESPONSIBILITIES
Standard for Examination of Documents
Discrepant Documents and Notice
Disclaimer on Effectiveness of Documents
Banks assume no liability or responsibility for the form, sufficiency, accuracy, genuineness, falsification or legal effect of any document(s), or for the general and/or particular conditions stipulated in the document(s) or superimposed thereon; nor do they assume any liability or responsibility for the description, quantity, weight, quality, condition, packing, delivery, value or existence of the goods represented by any document(s), or for the good faith or acts and/or omissions, solvency, performance or standing of the consignors, the carriers, the forwarders, the consignees or the insurers of the goods, or any other person whomsoever.
Disclaimer on the Transmission of Messages
Banks assume no liability or responsibility for the consequences arising out of delay and/or loss in transit of any message(s), letter(s) or document(s), or for delay, mutilation or other error(s) arising in the transmission of any telecommunication. Banks assume no liability or responsibility for errors in translation and/or interpretation of technical terms, and reserve the right to transmit Credit terms without translating them.
Banks assume no liability or responsibility for the consequences arising out of the interruption of their business by Acts of God, riots, civil commotions, insurrections, wars or any other causes beyond their control, or by any strikes or lockouts. Unless specifically authorised, banks will not, upon resumption of their business, pay, incur a deferred payment undertaking, accept Draft(s) or negotiate under Credits which expired during such interruption of their business.
Disclaimer for Acts of an Instructed Party
Bank-to-Bank Reimbursement Arrangements
Ambiguity as to the Issuers of Documents
Unspecified Issuers or Contents of Documents
When documents other than transport documents, insurance documents and commercial invoices are called for, the Credit should stipulate by whom such documents are to be issued and their wording or data content. If the Credit does not so stipulate, banks will accept such documents as presented, provided that their data content is not inconsistent with any other stipulated document presented.
Issuance Date of Documents v. Credit Date
Unless otherwise stipulated in the Credit, banks will accept a document bearing a date of issuance prior to that of the Credit, subject to such document being presented within the time limits set out in the Credit and in these Articles.
Marine/Ocean Bill of Lading
Non-Negotiable Sea Waybill
Charter Party Bill of Lading
Multimodal Transport Document
Air Transport Document
Road, Rail or Inland Waterway Transport Documents
Courier and Post Receipts
Transport Documents issued by Freight Forwarders
Unless otherwise authorised in the Credit, banks will only accept a transport document issued by a freight forwarder if it appears on its face to indicate:
“On Deck”, “Shipper’s Load and Count”, Name of Consignor
Unless otherwise stipulated in the Credit, banks will accept a transport document which:
Clean Transport Documents
Freight Payable/Prepaid Transport Documents
Type of Insurance Cover
All Risks Insurance Cover
Where a Credit stipulates “insurance against all risks”, banks will accept an insurance document which contains any “all risks” notation or clause, whether or not bearing the heading “all risks”, even if the insurance document indicates that certain risks are excluded, without responsibility for any risk(s) not being covered.
If a Credit calls for an attestation or certification of weight in the case of transport other than by sea, banks will accept a weight stamp or declaration of weight which appears to have been superimposed on the transport document by the carrier or his agent unless the Credit specifically stipulates that the attestation or certification of weight must be by means of a separate document.
E. MISCELLANEOUS PROVISIONS
Allowances in Credit Amount, Quantity and Unit Price
If drawings and/or shipments by instalments within given periods are stipulated in the Credit and any instalment is not drawn and/or shipped within the period allowed for that instalment, the Credit ceases to be available for that and any subsequent instalments, unless otherwise stipulated in the Credit.
Expiry Date and Place for Presentation of Documents
Limitation on the Expiry Date
Extension of Expiry Date
Hours of Presentation
Banks are under no obligation to accept presentation of documents outside their banking hours.
General Expressions as to Dates for Shipment
Date Terminology for Periods of Shipment
F. TRANSFERABLE CREDIT
G. ASSIGNMENT OF PROCEEDS
Assignment of Proceeds
The fact that a Credit is not stated to be transferable shall not affect the Beneficiary’s right to assign any proceeds to which he may be, or may become, entitled under such Credit, in accordance with the provisions of the applicable law. This Article relates only to the assignment of proceeds and not to the assignment of the right to perform under the Credit itself.
UCP 500 Correcting some misinterpretations
Issued in 1994
The ICC Commission on Banking Technique and Practice (Banking Commission) notes with regret, and concern, that following the coming into effect of the ‘Uniform Customs and Practice for Documentary Credits’ (UCP 500) various banks have been applying unilateral and incorrect interpretations to certain of its Articles. By prejudicing the proper and correct application of the UCP 500 rules, the effect has been to seriously interfere with the use of the documentary letter of credit issued in accordance with the UCP, as the means for effective and secure settlement of trade transactions on a worldwide basis.
For the first time, this latest revision of the banking rules specifically included mention of certain long-standing and customary banking practices but, in some cases, their mention has been read, quite incorrectly, as indicating changes in practice. We of the Banking Commission are greatly concerned that the misinterpretations and misapplications of the particular Articles of UCP 500 involved, adversely effect not only the banks along the transaction chain, but also their customers whether applicants or beneficiaries under the Credits and, at the same time, carriers and freight forwarders who may also be involved in ensuring the correctness of documentation to comply with the particular documentary letter of credit.
In the special circumstances, the Banking Commission has authorized the issuance of the attached ‘Policy Statements’ to emphasize the need to correctly interpret and apply UCP 500 sub-Article 9(d)(iii) – Amendments; sub-Article 10(b)(ii) – Negotiation; sub-Article 13(c) – Non-documentary conditions; and the related sub-Articles of Articles 23, 24, 25, 26, 27, 28, 29 and 30 – Transport Documents. Failure to interpret the sub-Articles as indicated, in future, should be seen as in violation of the principles of UCP 500.
Consequently, the Banking Commission strongly urges that ICC national committees, and associated organizations, distribute the Position Papers as widely as possible to help in ensuring the future smooth running of the documentary credit issued under the protection of UCP 500, which has been disturbed unnecessarily as indicated above. The point is, of course, made that the Policy Statements do not amend the sub-Articles of UCP 500 in any way but merely indicate the correct interpretation of particular sub-Articles.
Charles del Busto
Chairman, ICC Commission on Banking Technique and Practice (1989-1996)
UCP 500 SUB-ARTICLE 9(D)(III)
The Banking Commission strongly disagrees with the wrong practice adopted by:
The essence of an irrevocable documentary credit is clearly set out in the sub-Article 9(d)(i) statement that: ‘an irrevocable credit can neither be amended nor cancelled without the agreement of the Issuing Bank, the Confirming Bank, if any, and the Beneficiary’.
The practices referred to above are seen as changing the irrevocable nature of the documentary credit irrevocable undertaking.
Moreover, the presumption that a beneficiary’s silence amounts to his acceptance of an amendment is contrary to national law in many countries. An attempt of the nature referred to above to over-rule sub- Article 9(d)(iii) may therefore lack legal effect.
Banks are wrong in assuming that sub-Article 9(d)(iii) involves a change of policy. It merely states the position which existed prior to the introduction of UCP 500, and indicates the alternative ways in which the beneficiary may choose to signify his acceptance and avail himself of an amendment to an irrevocable documentary credit which has been offered to him by the Issuing Bank and, where appropriate, by the Confirming Bank – or whereby he may indicate his rejection of such amendment.
UCP 500 SUB-ARTICLE 10(B)(II)
The Banking Commission notes with regret that, notwithstanding the clear definition contained in the above sub-Article, a number of banks fail to understand the meaning of the term ‘negotiation’ in connection with the availability of a documentary credit.
The term ‘negotiation’ is defined in sub-Article 10(b)(ii) as ‘the giving of value for Draft(s) and/or document(s) by the bank authorised to negotiate’. The Banking Commission wishes to clarify that for the purposes of UCP 500, the phrase ‘giving of value’ in sub-Article 10(b)(ii) may be interpreted as either ‘making immediate payment’ (e.g. by cash, by cheque, by remittance through a Clearing System or by credit to an account) or ‘undertaking an obligation to make payment’ (other than giving a deferred payment undertaking or accepting a draft).
The view has also been expressed that where a documentary credit is stated to be available by ‘negotiation’, it is essential for the beneficiary to seek and/or secure ‘negotiation’ from the Nominated Bank if he wishes to avail himself of the documentary credit.
The Banking Commission disagrees with this view, which it emphasises is in conflict with both the provisions and intent of sub- Articles 9(a)(iv) and (b)(iv) and 10(c), where the relative undertakings of the Issuing Bank and the Confirming Bank (if any), as well as the position of the Nominated Bank, are clearly stated.
Failure by the beneficiary to seek and /or secure ‘negotiation’ from the Nominated Bank under a documentary credit which allows negotiation, does not affect the undertakings of the Issuing Bank and/or the Confirming Bank (if any), nor does it constitute noncompliance with the documentary credit terms, provided that conforming documents are presented by the beneficiary within the validity of the documentary credit and the sub-Article 43(a) period of time where appropriate, to a Nominated Bank or direct to the Confirming Bank (if any) or to the Issuing Bank.
UCP 500 SUB-ARTICLE 13(C)
The provisions of this sub-Article have the specific purpose of eradicating the totally wrong practice of incorporating non-documentary condition(s) into documentary credits.
Such practice defeats the underlying principle of the documentary credit itself and directly contradicts the wording of Articles 2 – ‘Meaning of Credit’; 4 – ‘Documents V Goods/Services/Performances; 5(b) – ‘Instructions to Issue/Amend Credits’; and 13(a) – ‘Standard for Examination of Documents’, all of which clearly indicate that payment, acceptance or negotiation under a documentary credit is to be effected against documents stipulated in the documentary credit.
The Banking Commission therefore expresses its strong disapproval of the fact that notwithstanding the provisions of sub-Article 13(c), certain banks continue to issue documentary credits and amendments thereto which contain a non-documentary condition(s).
Furthermore, it is evident that such wrong practice is causing severe problems to all parties involved in documentary credit transactions.
The Banking Commission wishes to remind banks, therefore, that where a documentary credit or amendment thereto contains one or more conditions and does not state the document(s) to be presented to evidence compliance therewith, sub-Article 13(c) clearly provides that banks will deem such a condition(s) as not stated and will disregard it (them).
Accordingly, banks will accept as a valid tender under the documentary credit stipulated documents which appear to be in accordance with all other terms and conditions of the documentary credit.
Sometimes, however, a condition appears in a documentary credit which can be clearly linked to a document stipulated in that documentary credit. Such a condition is not then deemed to be a non-documentary condition. For example, if a condition in the documentary credit states that the goods are to be of German origin and no Certificate of Origin is called for, the reference to ‘German origin’ would be deemed to be a non-documentary condition and disregarded in accordance with UCP 500 sub-Article 13(c). If, however, the same documentary credit stipulated a Certificate of Origin, then there would not be a non-documentary condition as the Certificate of Origin would have to evidence the German origin. (See also ICC Publication No. 511, UCP 500 and 400 Compared, page 42.)
It should therefore be clear that banks should include any appropriate ‘condition(s)’ in the detail of the document(s) stipulated, or state expressly the document which is to evidence compliance with a specific ‘condition(s)’.
UCP 500 – TRANSPORT DOCUMENTS ARTICLES
Marine/Ocean bill of lading
Non-negotiable sea waybill.
In view of the controversy surrounding some individual interpretations of sub-paragraph (a)(i) of these Articles, the Banking Commission wishes to clarify the position by setting out requirements as under:
Banks will therefore reject documents which fail to comply with the requirement set out in ‘1’ above, i.e. which fail to indicate the name of the carrier on the front of the document, even though the identity of the carrier may be indicated on the back of the document.
Charter party bill of lading
In respect of this Article there has not been found need for interpretative comment.
This is the type of document most likely to be signed by the Master, or for (or ‘on behalf of ’) the Master. The requirement ‘4’ above in respect of Articles 23 and 24 also applies to Article 25.
Multimodal transport document The requirements detailed in respect of Articles 23 and 24 above also apply to Article 26, but it should be noted that:
Many major multimodal transport operators (MTOs) use a multipurpose format document, titled, for example:
‘Bill of Lading for Combined Transport Shipment or Port-to-Port Shipment’, or ‘Non-Negotiable Sea Waybill for Combined Transport Shipment or Port-to-Port Shipment’.
A document issued with either title above is also acceptable under Article 26, provided that the data content on the front of the document satisfies the requirement in the documentary credit for multimodal transport and for a negotiable document or for a nonnegotiable document as the case may be.
A multimodal transport document may possibly show the word ‘carrier’ and not the words ‘multimodal transport operator’ – this is acceptable under the ‘carrier or multimodal transport operator’ wording of Article 26.
Air transport document
Road, rail or inland waterway transport documents
Courier and post receipts
In respect of these Articles there has not been found need for interpretative comment.
Transport documents issued by freight forwarders In addition to satisfying the requirements of Article 30 the transport document stipulated must, of course, also satisfy the requirements of Articles 23/28 according to the mode of carriage.
Commission on Banking Technique and Practice, 6 April 1998
The International Chamber of Commerce (ICC) is the world business organization, based in Paris. The ICC Commissions on Banking Technique & Practice, International Commercial Practice, and Insurance, develop and maintain uniform rules for international trade, including the Uniform Rules for Contract Guarantees (URCG 325), Uniform Rules for Demand Guarantees (URDG 458), Uniform Customs and Practice for Documentary Credits (UCP 500), Uniform Rules for Collections (URC 522), Uniform Rules for Contract Bonds (URCB 524), and Uniform Rules for Bank-to-Bank Reimbursements (URR 525) (hereinafter referred to collectively as “ICC Rules”).
The Introduction of the European single currency (euro), shall not have the effect of altering, discharging or excusing performance under any instrument subject to ICC Rules. This Decision emphasizes the need to correctly interpret and apply ICC Rules. Consequently, ICC national committees and associated organizations are strongly urged to distribute this Decision as widely as possible to help ensure the future smooth running of the instruments issued under ICC Rules. This Decision does not amend any articles of ICC Rules in any way, but merely indicates the correct interpretation thereof which has been adopted unanimously by the ICC Commission on Banking Technique and Practice, on 6 April 1998.
1.1 As of 1 January 1999, the euro will be substituted for the national currency unit of those European Union member states participating in European Economic and Monetary Union (hereinafter, “EMU-Participating States”) which are to be designated in May 1998. During the transitional period running from 1 January 1999 to 31 December 2001, the euro (1 euro = 100 cents) will also be divided into the national currency unit of the EMU-Participating States according to conversion rates which are to be irrevocably fixed by the Council of the European Union as of 1 January 1999 (“conversion rates”). The term “national currency unit” as used below refers to the currency of any EMU-Participating State before 1 January 1999.[Page189:]
During the transitional period persons are free to use either the euro or the national currency unit, but will not (unless otherwise agreed) be obliged to receive or make payment in euro. Any amount denominated either in euro or in a national currency unit of a given EMU-Participating State and payable within that state by crediting an account of the creditor, may be paid by the debtor either in euro or in that national currency unit, with any necessary conversion being effected at the conversion rate.
As of 1 January 1999 the ECU will be replaced by the euro at the rate of one euro to one ECU.
1.2 As from 1 January 2002 the national currency unit will cease to exist and the euro will be the only legal currency in the EMUParticipating States; all payments must be in euro.
1.3 Continuity of contract will not be affected by the introduction of the euro.
1.4 The above principles affecting national currency unit are legally binding in all EMU-Participating States, and apply equally to payment to be made in a national currency unit by persons located outside the European Union, due to the generally accepted legal principle that the definition of what constitutes legal tender is governed by the law of the country whose currency is involved (sometimes referred to as the lex monetae principle).
2. Consequences of the introduction of the euro on practice under various ICC rules
2.1 UCP 500 for Documentary Credits (including standby letters of credit). Below are the different possible cases and the relevant rules of interpretation:
2.1.1 Documentary credits issued and payable before 1 January 1999 in a national currency unit.
Payment must be made and documents denominated in the currency of the credit.
2.1.2 Documentary credits issued before 1 January 1999 and payable between 1 January 1999 and 1 January 2002 in a national currency unit.
Payment must be made in the currency of the credit, but documents issued between 1 January 1999 and 1 January 2002 may be presented either in the currency of the credit or in the euro equivalent or in the equivalent cross-value in the national currency unit of the beneficiary’s place of business; however, where payment is to be made in the currency of an EMU-Participating State and by crediting an account located in such member state, payment may at the debtor’s (e.g. issuing bank’s) option be effected in the euro equivalent.
2.1.3 Documentary credits issued in a national currency unit before 1 January 1999 and payable on or after 1 January 2002.
Payment must be made in euro, but documents issued between 1 January 1999 and 1 January 2002 may be presented either in the currency of the credit or in the euro equivalent or in the equivalent cross-value in the national currency unit of the beneficiary’s place of business; documents issued on or after 1 January 2002 must be denominated in euro.
2.1.4 Documentary credits issued and payable on or after 1 January 1999 and before 1 January 2002 in a national currency unit or in euro.
Payment must be made in the currency of the credit, but documents issued between 1 January 1999 and 1 January 2002 may be presented in the currency of the credit or in the euro equivalent or in the equivalent cross-value in the national currency unit at the beneficiary’s place of business; however, where the currency of the credit is a national currency unit and payment is to be made in the currency of a particular EMU-Participating State by crediting an account located in such member state, payment may at the debtor’s (e.g. issuing bank’s) option be effected in euro.
2.1.5 Documentary credits issued on or after 1 January 1999 but before 1 January 2002 in a national currency unit or in euro and payable on or after 1 January 2002.
Payment must be made in euro, but documents may be presented either in the currency of the credit or, as the case may be, in euro or in the national currency unit of the beneficiary’s place of business, provided always that documents issued on or after 1 January 2002 must be denominated in euro.
2.1.6 For purposes of examples 2.1.2, 2.1.3, 2.1.4 and 2.1.5 above, documents (including insurance documents mentioned in UCP Art. 34 f) are not considered as being inconsistent with one another, i f, within a single presentation of documents, any documents are denominated in the currency of the credit and/or in euro and/or in the national currency unit of the beneficiary’s place of business.
2.1.7 Documentary credits issued and payable on or after 1 January 2002.
Credits cannot be issued in a national currency unit and must be issued in euro and payment must be made and documents (issued on or after 1 January 2002) denominated in euro.
2.1.8 The guidelines set forth in this Decision apply equally to transferable credits. With regard to transferable credits issued in a national currency unit and to be transferred during the transitional period, the transferring bank may convert the currency and amount of the credit into the euro equivalent.
2.2 URCG 325 / URDG 458 / URCB 524 – Guarantees and bonds
The principles set forth above also apply to guarantees and bonds.
2.3 URC 522 Collections
Collections must be made in the currency stipulated in the collection instructions. However, if a collection instruction stipulates a national currency unit of an EMU-Participating State, as of 1 January 1999 payment may be made in the euro equivalent and as of 1 January 2002, payment must be made and accepted in the euro equivalent.
2.4 URR 525 Bank-to-Bank Reimbursements
Reimbursement claims must be made and honoured in the currency of the reimbursement authorization or reimbursement undertaking. However, if such currency is the national currency unit of an EMU-Participating State, from 1 January 1999 they may be made and honoured in the euro equivalent, and as from 1 January 2002 they must be made and honoured in the euro equivalent.
The Determination of an “Original” Document in the Context of UCP 500 sub-Article 20(b)*
* Decision approved by the ICC Commission on Banking Technique and Practice and published on 12 July 1999.
Over a period of several years there have been a number of queries raised with the ICC Banking Commission as to the determination, by banks, of what is an “original” document under a letter of credit and the necessity, if any, for such a document to be so marked.
For ease of reference the text of sub-Article 20(b) reads:
"Unless otherwise stipulated in the Credit, banks will also accept as an original document(s), a document(s) produced or appearing to have been produced:
provided that it is marked as original and, where necessary, appears to be signed.
A document may be signed by handwriting, by facsimile signature, by perforated signature, by stamp, by symbol, or by any other mechanical or electronic method of authentication.”
2. DETERMINATION OF ORIGINALITY
In documentary credit operations, the document checker is faced with a number of issues pertaining to originality including:
Banks undertake to determine whether a document appears on its face to be an original document, as distinguished from a copy. Except as expressly required by a letter of credit including an incorporated term – such as UCP 500 sub-Articles 23(a)(iv) or 34(b) – banks do not undertake to determine whether an apparent original is the sole original. Banks rely on the apparent intent of the issuer of the document that it be treated as an original rather than a copy.
In this regard, a person sending a telefax or making a photocopy on plain paper or pressing through carbon paper presumably intends to produce a copy. On the other hand, a person printing a document on plain paper from a text that that person created and electronically stored presumably intends to produce an original. Accordingly, documents bearing facsimile signatures or printed in their entirety (even including the issuer’s letterhead and/or signature) from electronically stored text are presumably intended by the document issuer to be original and in practice are accepted by banks as original.
Documents that Appear to be Original But Are Not
Banks do not undertake to determine whether a document is original in fact. Under UCP 500 Article 15, banks are not responsible for the genuineness or falsification of any document. If a document appears to be original or to have been marked as original but is in fact not original, then its presentation may give rise to exceptional defences, rights, or obligations under the law applicable to forged or fraudulent presentations and is beyond the scope of UCP 500.
UCP 500 Requirements
The UCP neither requires nor permits an examination beyond the face of a document to determine how the document was in fact produced, unless the document was produced by the bank, e.g. on a telefax, telex, e-mail, or other system that prints out messages received by the bank. The “produced or appearing to have been produced” language in sub-Article 20(b) does not override UCP 500 sub-Articles 13(a), 13(c), or 14(b), or other practice and law that prohibit issuers and confirmers from determining compliance on the basis of extrinsic facts.
As indicated by inclusion of the word “also” (“ ... banks will also accept as original(s) ...”), sub-Article 20(b) is neither comprehensive nor exclusive in its provisions that distinguish originals from copies. For example, a document printed on plain paper from electronically stored text is acceptable, without regard to 20(b), if it appears to be an original.
Sub-Article 20(b) does not apply to documents that appear to be only partially produced by reprographic, automated, or computerized systems or as carbon copies. In this regard, a photocopy ceases to be “reprographically produced” within the meaning of sub-Article 20(b) when it is also manually stamped, dated, completed, or signed by the issuer of the document.
The “marked as original” proviso in sub-Article 20(b) is satisfied by any marking on a document or any recital in the text of a document that indicates that the issuer of the document intends it to be treated as an original rather than a copy. Accordingly, a document that appears to have been printed on plain paper from electronically stored text is “marked as original” under sub-Article 20(b) if it also states that it is original or includes letterhead or is hand marked.
Sub-Article 13(a) of UCP 500 refers to compliance of the presented documents being determined by international standard banking practice as defined in the articles of UCP. International standard banking practice in relation to determination of “original” documents could be described as follows:
3. CORRECT INTERPRETATION OF SUB-ARTICLE 20(B)
Banks examine documents presented under a letter of credit to determine, among other things, whether on their face they appear to be original. Banks treat as original any document bearing an apparently original signature, mark, stamp, or label of the issuer of the document, unless the document itself indicates that it is not original. Accordingly, unless a document indicates otherwise, it is treated as original if it:
Hand Signed Documents
Consistent with sub-paragraph (A) above, banks treat as original any document that appears to be hand signed by the issuer of the document. For example, a hand signed draft or commercial invoice is treated as an original document, whether or not some or all other constituents of the document are preprinted, carbon copied, or produced by reprographic, automated, or computerized systems.
Facsimile Signed Documents
Banks treat a facsimile signature as the equivalent of a hand signature. Accordingly, a document that appears to bear the document issuer’s facsimile signature is also treated as an original document.
Banks treat as non-original any document that appears to be a photocopy of another document. If, however, a photocopy appears to have been completed by the document issuer’s hand marking the photocopy, then, consistent with sub-paragraph (A) above, the resulting document is treated as an original document unless it indicates otherwise. If a document appears to have been produced by photocopying text onto original stationery rather than onto blank paper, then, consistent with sub-paragraph (B) above, it is treated as an original document unless it indicates otherwise.
Telefaxed Presentation of Documents
Banks treat as non-original any document that is produced at the bank’s telefax machine. A letter of credit that permits presentation by telefax waives any requirement for presentation of an original of any document presented by telefax.
Statements Indicating Originality
Consistent with either or both of sub-paragraphs (A) and (C) above, a document on which the word “original” has been stamped is treated as an original document. A statement in a document that it is a “duplicate original” or the “third of three” also indicates that it is original. Originality is also indicated by a statement in a document that it is void if another document of the same tenor and date is used. Statements Indicating Non-originality
A statement in a document that it is a true copy of another document or that another document is the sole original indicates that it is not original. A statement in a document that it is the “customer’s copy” or “shipper’s copy” neither disclaims nor affirms its originality.
4. WHAT IS NOT AN “ORIGINAL”?
A document indicates that it is not an original if it
Based upon the comments received from ICC national committees, members of the ICC Banking Commission and other interested parties, the statements in clauses 3 and 4 above reflect international standard banking practice in the correct interpretation of UCP 500 sub-Article 20(b).
Scope of the eUCP
Relationship of the eUCP to the UCP
An eUCP Credit must specify the formats in which electronic records are to be presented. If the format of the electronic record is not so specified, it may be presented in any format.
Notice of Refusal
Originals and Copies
Any requirement of the UCP or an eUCP Credit for presentation of one or more originals or copies of an electronic record is satisfied by the presentation of one electronic record.
Date of Issuance
Unless an electronic record contains a specific date of issuance, the date on which it appears to have been sent by the issuer is deemed to be the date of issuance. The date of receipt will be deemed to be the date it was sent if no other date is apparent.
If an electronic record evidencing transport does not indicate a date of shipment or dispatch, the date of issuance of the electronic record will be deemed to be the date of shipment or dispatch. However, if the electronic record bears a notation that evidences the date of shipment or dispatch, the date of the notation will be deemed to be the date of shipment or dispatch. A notation showing additional data content need not be separately signed or otherwise authenticated.
Corruption of an Electronic Record after Presentation
Additional Disclaimer of Liability for Presentation of Electronic Records under eUCP
By checking the apparent authenticity of an electronic record, Banks assume no liability for the identity of the sender, source of the information, or its complete and unaltered character other than that which is apparent in the electronic record received by the use of a commercially acceptable data process for the receipt, authentication, and identification of electronic records.