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UCP 600 sub-article 14 (j); ISBP 681 paragraph 144
Where the credit is silent with regard to the consignee and notify party details and these fields are completed with applicant addresses, must the addresses be the same as that quoted in the credit?
Query [TA 702rev]
We would like to seek an official opinion of the ICC Banking Commission on the following matters regarding consignee and notify party details on transport documents.
We received a documentary credit, subject to UCP 600, bearing the following requirement with respect to the transport document in field 46A:
- Air waybill
- With regard to the consignee and notify party details, the credit was silent. The applicant was stated in field 50 of the credit as follows:
- Company X
- Head office
- Praha, Czech Republic
We received documents including an air waybill issued as follows:
- Consignee: Company X, Brno branch, (address), Brno, Czech Republic
- Notify: Company X, logistics department, (address different from applicant's stated in field 50 of the credit), Praha, Czech Republic.
We negotiated the documents, which we held to be in accordance with the terms and conditions of the credit. Nevertheless, we received the issuing bank's refusal notice stating: "Air Waybill: Address of applicant as consignee and notify party not the same as the applicant's address stated in the credit (breach of sub-article 14 (j) of UCP 600)".
We responded that the credit was absolutely silent about the consignee and notify party; hence, consignee and notify party fields could be completed in any manner. We also referred to paragraph 144 of ISBP (ICC document No. 681) with respect to the notify party details.
The issuing bank replied that it had refused the documents on the basis of UCP 600 and that it considered UCP 600 sub-article 14 (j) to take precedence over paragraph 144 of the ISBP. The issuing bank also stated in its reply that sub-article 14 (j) applies generally, i.e, it states "... when the address and contact details of the applicant appear as part of the consignee or notify party details ... they must be as stated in the credit", adding that this requirement was not qualified by saying "If the credit requires goods to be consigned to and/or notify applicant" or similar.
We seek your opinion on the following four questions:
1. Is the discrepancy raised by the issuing bank valid with respect to the consignee, although the credit gave no indication how the consignee details were to be completed?
2. Is the discrepancy valid also with respect to the notify party despite the express wording of paragraph 144 of ISBP? If the answer to 1 or 2 is yes:
3. Would the answer be different, if the address(es) were exactly the same but mere additional details (such as P.O. Box, phone number, fax, etc.), not stated in the credit, were added? If the answer to 1 is yes:
4. Notwithstanding the answer to No. 1 being yes, do we understand the UCP requirements correctly? We deem any party (except for the situation described in No. 1) appearing as consignee to be acceptable, provided the credit is silent on the consignee details. In such cases is a transport document consigned to a party not mentioned in the credit at all, or consigned to the beneficiaries themselves, (which may make sense, for example, in case of a back-to-back transaction), acceptable?
In circumstances in which a credit is silent with regard to the consignee and/or notify party details, it is correct (subject to the comments below) to say that these may be completed with the details of any consignee or notify party. With regard to a notify party, ISBP publication 681 paragraph 144 states: "If a credit does not state a notify party, the respective field on the air transport document may be left blank or completed in any manner."
Despite the general position given above, sub-article 14 (j) includes the following: "However, when the address and contact details of the applicant appear as part of the consignee or notify party details on a transport document subject to articles 19, 20, 21, 22, 23, 24 or 25, they must be as stated in the credit."
It should be noted that the above wording applies when the address and contact details of the applicant appear in the consignee and/or notify party fields of a transport document.
In circumstances in which the credit is silent as to the consignee and any required notify party, the content of sub-article 14 (j) would prevail when the consignee and notify party are stated to be the applicant. In this event, the address and any contact details must be those stated in the credit.
If a credit does not provide any contact details of the applicant, such details may be added to the consignee and/or notify party details that are shown on the transport document.
To say, as referred to in sub-article 14 (j), that the address should be that stated in the credit does not imply that it need be exactly the same, merely that it not give a different location.
1. The discrepancy is valid.
2. The discrepancy is valid.
3. The addition of contact details not given in the credit would not be a reason for refusal.
4. Absent any requirements in the credit, the transport document may show any party as the consignee or notify party, subject to the requirements of sub-article 14 (j) being met if the applicant is stated to be the consignee and/or the notify party.
UCP 600 sub-article 20 (a) (i)
Where the party on a B/L as the named carrier and the signing party were one and the same company, did this mean the document complied with sub-article 20 (a) (i)? Where the box in which the name and address of the company appeared had no field tag, but where above this box was the indication "Name of Carrier", could these two pieces of data be seen as one source giving an indication of the name of the carrier?
Query [TA 695rev]
Our Group of Experts on documentary credits received a query from a Country S Bank which has been given number 158 in our files. A copy of a B/L is attached and the following questions are raised in respect to it.
1) In the attached document. Can the signing party be considered to be duly identified?
The right-hand box on the lower part of the document has no pre-printed or added text, just a signature and the stamp of a company. In the box immediately on top of that one (where "Barcelona 16/01/2009" appears), the pre-printed text says "place and date of issue".
2) Can it be considered that the carrier identification poses no doubt?
The box on the upper right-hand side where Masterline Logistics S.L. and its address appears is different from the remainder of the document, as it has no pre-printed text as an identifier of data for that box. In the box immediately on top of that one, the following can be read: "name of the carrier" (text that can also be read on the bottom of that box and is different from all the other boxes of the document in which an explanation appears).
National committee analysis
Our Group of Experts unanimously agree that the analysis must take into account sub-article 20 (a) (i) of UCP 600, which reads as follows:
"A bill of lading, however named, must appear to:
i) indicate the name of the carrier and be signed by:
- The carrier or a named agent for or on behalf of the carrier, or
- The master or a named agent for or on behalf of the master.
Any signature by the carrier, master or agent must be identified as that of the carrier, master or agent. Any signature by an agent must indicate whether the agent has signed for or on behalf of the carrier or for or on behalf of the master."
Also considered must be paragraph 94 of ISBP 681 concerning signing of bills of lading, as follows: "Original bills of lading must be signed in the form described in UCP 600 sub-article 20 (a) (i) and indicate the name of the carrier, identified as the carrier."
Some members of the Group include in their analysis the following references which, the majority of the Group recognizes enrich the debate but are not exactly relevant to analyze this case. They are included in this response in order to offer an insight into the debate within the Group. These references are an excerpt from the official Commentary on UCP 600, which reads: "Sub-article (a) (i) also goes on to describe what is required by way of signature. The party signing the bill of lading must indicate whether it is signing as carrier, master or agent, and if the party is signing as agent, the name of that agent must be included, as well as the capacity in which it is signing. Therefore, a simple signature on the bill of lading does not suffice. The indication of the capacity of the one signing the bill of lading must also appear in the signature space. However, if the bill of lading shows the name of the issuing company together with the indication 'carrier', a simple signature in the signature box with the indication 'for and on behalf of [name of the issuing company]' or 'for and on behalf of the carrier' or a similar indication would be sufficient."
Some in the Group also point to Position Paper number 4 from 1994 (though the new UCP 600 expressly declares in its introduction that the Position Papers are no longer to be applied). However, it is mentioned here, since the texts referred to signatures on bills of lading, which show no difference between UCP 500 and UCP 600. For that reason, it was argued that if it was valid in one case it should also be valid in the other one. Point 2 of Position Paper No. 4 read: "Where the document is signed by the carrier, it is not necessary for the word 'carrier' to appear again in the signature box when it has already been used on the front of the document to identify the party acting as carrier."
Also pointed to were comments from the ICC Transport Commission included in Banking Commission Opinion 470/TA.625 rev. 2, as follows:
"One possible explanation would be that the carrier and the agent operate under the same name. Although the agent is normally a different entity to the carrier, it appears that it is not unusual for large container lines to own the local agency offices, which will operate as part of the main global brand. So, for example, the container line ABC Co. Ltd might own the agents ABC Co. (Hong Kong), who will be part of the main ABC Co. brand. In this case, if the agent sees itself as being part of ABC Co. Ltd, rather than as a separate entity, then it might just identify itself as ABC Co. Ltd, without seeing the need to specify itself as ABC Co. (Hong Kong).
"It could also be the case that a department of the carrier company acts as the agent. In this case, the department that is acting as the agent may sign the Bill of Lading as the agent, to denote its operational role in relation to the shipment, notwithstanding the fact that there is no legal distinction between itself and the department performing the operational role of the carrier.
"Another explanation is that, in the limited number of cases where the carrier signs the bill of lading itself, it may opt to complete the blank space for the 'agent' rather than revise the form or leave the agent space empty. In this case, the signature would be aimed at binding the carrier as the carrier."
National committee conclusion
Our Group of Experts unanimously agrees that the identification of the carrier poses no doubt. Thus, the response to the second question is "Yes". The carrier is clearly identified in the document. It is true that the pre-printed text of the document can lead to confusion (due to the box where the carrier is identified not including the text "Name of the Carrier", but that text appears in the box above that one). The Group considers that there is no doubt that Masterline Logistics, S.L. is the name of the carrier and that it is indicated in the box immediately below the text "Name of the carrier", where it apparently has no other function.
The first question, however, poses more doubts and left the Group divided. Half of them considered that the signing party was perfectly identified in the document. This half of the Group believed that the rules requirement that the signing party must identify in what capacity he/she signs (as carrier, agent or master) does not mean that the identification is necessarily linked to the signature. Once identified in the document, there is no need to repeat it any other time it appears. The other half of the Group disagreed.
First issue -- can the signing party be considered to be duly identified?
The name of the carrier has already been determined within the bill of lading (see the national committee and Banking Commission responses to the second issue). As the named carrier and the signing party are one and the same company, the requirement in sub-article 20 (a) (i) "[A]ny signature by the carrier, master or agent must be identified as that of the carrier, master or agent" has been fulfilled.
Second issue -- can it be considered that the carrier identification poses no doubt?
The conclusion of your Group of Experts is agreed to. The box in which the name and address of the company appears has no field tag. However, immediately above this box is the indication "Name of Carrier". These two pieces of data should be seen as one source giving an indication of the name of the carrier.
It should be noted that the publication Commentary on UCP 600 is not an official publication of ICC and is a guide prepared by the UCP 600 Drafting Group.
The bill of lading is compliant with sub-article 20 (a) (i). 681 paragraph 23; UCP 600 sub-articles 28 (f) (iii), 16 (c) (ii), 14 (d), 18 (a) (ii); and article 9
ISBP 681 paragraph 39
Whether the name of the applicant on the protocol conflicted with that on the documentary credit
Query [TA 692rev]
We kindly ask your official opinion on the following question related to a presentation under a documentary credit issued subject to UCP 600.
The documentary credit (issued by a bank in Country R) in favour of a beneficiary in Country D required, amongst others, the following document: "Protocol confirming that the bakery equipment (acc. 45A) was successfully installed signed both by the applicant and the beneficiary - 1 original".
The documents were refused by the nominated bank (in Country G) citing the following discrepancies:
- Stamp of "OOO Country D" [i.e., the applicant] is missing
- Name of applicant differs within the document ("OOO Country D" - conforms with the L/C; "Country D Ltd" does not conform).
After an agreement with the presenter, the nominated bank forwarded the documents to the issuing bank. The issuing bank refused the documents, citing the same discrepancies as the nominated bank. The applicant did not waive the discrepancies.
The name of the applicant in the credit was mentioned as "OOO Country D" [plus address]. In all other documents presented (including the invoice), the name of the applicant was stated according to the credit, i.e., "OOO Country D"
The nominated bank and the issuing bank maintained their refusal by stating that there was no stamp by the applicant and that the name of the applicant on the protocol conflicted with that on the documentary credit.
The presenter argued that:
- According to ISBP 681 (2007) paragraph 39: "A requirement for a document to be 'signed and stamped', or a similar requirement, is also fulfilled by a signature and the name of the party typed, or stamped, or handwritten, etc." Therefore, the name and signature on the document by the applicant would suffice as "stamp and signature". In any event, the credit did not require a stamp of the applicant to appear. The reference to "stamp" appeared only on the protocol.
- In Country R (when trading internationally) "Ltd" is often used as the equivalent of "OOO".
- Although signed by "Country D Ltd" at the bottom, the protocol was issued to "OOO Country D" at the top.
- The protocol was clearly signed by the applicant (this has not been contradicted), meaning that it neglected to waive an alleged discrepancy on a document it had signed itself.
Based on the above one cannot be in any doubt that the protocol was, in fact, signed by the applicant, i.e., in compliance with the requirement in the credit. We would appreciate your official opinion as to whether or not the discrepancies cited by the nominated and issuing banks are correct.
Discrepancy 1 - Stamp of "OOO Country D" [i.e., the applicant] is missing.
There was no requirement in the credit for the protocol to bear the stamp of the applicant. The protocol referenced the addition of a stamp and signature of the applicant in two places, but no stamp was added to the document. Although it is the protocol itself and not the credit that references a requirement for "stamp and signature", the content of paragraph 39 of ISBP 681 would also apply here. The document showed the name of the applicant as "Country D Ltd" in a typed format and was signed by a person purporting to represent "Country D Ltd". There is no discrepancy.
Discrepancy 2 - Name of applicant differs within the document ("OOO Country D" - conforms with the L/C; "Country D Ltd" does not conform.)
The credit provided limited information in respect of the content of the protocol, the main requirements being confirmation of the successful installation and signing by both the applicant and the beneficiary. The protocol clearly indicates the beneficiary's assertion that installation and signing by the applicant would determine the confirmation of this event.
The protocol is addressed to the applicant in a manner stated in the credit, i.e., "OOO Country D" followed by its address and issued on the letterhead of the beneficiary. The beneficiary has signed and stamped the document. In signing the document, the applicant's name has been typed as "Country D Ltd", a form that is also referenced within the body of the document in respect of the contract details.
As outlined in the query, "OOO Country D" and "Country D Ltd" have the same effect in describing the name of the applicant for the country of import, "OOO" and "Ltd" effectively being interchangeable. The protocol was clearly addressed to the applicant named in the credit and, despite the fact that the typed name at the signature line reads "Country D Ltd", it would appear that this is the same company and that the applicant actually signed the document. There is no discrepancy.
In respect of the facts stated in this query, the documents are compliant. The issuing bank must honour the presentation.
ISBP 681 sub-paragraph 43 (f); paragraphs 44 and 47
Where, under a deferred payment credit, more than one complete set of documents was enclosed under the cover of a single schedule and whether this meant the issuing bank should have paid under one maturity date
Query [TA 694]
We would like to request your opinion on the following question concerning correct calculation of a maturity date.
Under deferred payment letters of credit, we regularly send multiple sets of documents under one covering/remittance letter detailing the different maturity dates and requesting the issuing bank to effect payment at the relevant maturity dates.
Issuing banks have refused to comply due to the following:
- "We received one complying presentation under our L/C. Presented documents included 4 different copies of CIM and we calculated maturity date according to paragraph 43 (f) of ISBP version 2007 for UCP 600;
- "Your bank sent us all documents under one presentation only and according to paragraph 43 (f) of ISBP 681 we should pay under one maturity date;
- "According to ISBP 681, the date of the last transport document should be used for the calculation of the maturity date; and
- "There should be only one due date: our remark is based on paragraphs 43 (f) and 44 of ISBP 681, in which a bill of lading should not be taken literally, but in view of the stated paragraph 44 and the draft in view of paragraph 47 - our reserve stands."
Our bank does not agree with the above stated opinions; therefore, we tried to argue with the issuing banks as follows:
- "We regret, but we cannot accept one aggregated maturity date, since there were two partial shipments effected under our above presentation. Furthermore, two different sets of documents were presented for each shipment. Paragraph 43 (f) of ISBP we interpret as follows: if a credit requires an invoice, for example, at 30 days after the transport document date, and more than one set of CIM is presented under one invoice, the date of the last CIM will be used for the calculation of the maturity date. Draft means, in this context, invoice or claim and not a covering letter of a bank.
- "There were three partial shipments effected under our presentation. Goods were shipped on three means of conveyance in three separate trucks, so there should be three separate maturity dates.
- "A single presentation does not automatically mean that only one maturity date is to be applied."
Each of the schedules indicated the amount of each drawing (by invoice number and amount) and gave a total value for the invoices/schedule. The schedules also indicated "due for payment at  days after shipment, i.e., on X date for Y amount [for each invoice amount]". The schedules clearly indicated the amounts that were due on each respective maturity date calculated according to the LC terms.
Much to our regret, we were not able to convince the issuing banks that we are right. Nevertheless, as applicants accepted different maturity dates, they paid in due course, but maintained their opinion that only one maturity date should have been applied.
Please advise us whether our above suppositions are correct or not. If we are not correct concerning this question, please give provide guidance as to in which cases can there be more than one maturity date calculated under a single presentation.
Paragraph 43 (f) of ISBP publication 681 reads: "If a credit requires drafts to be drawn, for example, at 60 days after or from the bill of lading date, and more than one set of bills of lading is presented under one draft, the date of the last bill of lading will be used for the calculation of the maturity date."
The schedules showed the respective invoice amounts as an indication of the individual nature of the drawings. Additionally, although more than one complete set of documents was enclosed under the cover of a single schedule, the schedules gave details of each invoice amount and an indication of the due date for that invoice.
For these transactions there were no drafts, as the credits were available by deferred payment. The schedules showed the individual invoice amounts and the due dates for payment thereof. Therefore, the content of paragraph 43 (f) would not apply to these transactions.
Your understanding is correct. The issuing banks should have paid the individual invoice amounts on the due dates as specified in the covering schedules.
In order to avoid situations like this, it would be advisable for banks to adopt a practice of one presentation per schedule.