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The last three months have been among the busiest in the history of the ICC Banking Commission. As noted in the previous article, four new sets of rules and interpretations have either been approved or are waiting approval. In addition, the structure and membership of the Commission will substantially change.

The rules first. The new Uniform Rules for Forfaiting (URF), several years in the making, are the fruit of a collaboration between the Banking Commission and the International Forfaiting Association (IFA). Forfaiting, for those who may not be familiar with the practice is, according to Investopedia, "the purchase of an exporter's receivables (the amount importers owe the exporter). The forfaiter, the purchaser of the receivables, becomes the entity to whom the importer is obliged to pay its debt."

For L/C practitioners it pays to know that L/Cs are largely forfaited, particularly in China, where forfaiting constitutes the bulk of transactions. The Commission's entrance into the new field is an indication of its expanding role, encompassing the entire field of trade finance.

The second rules, also the result of a collaboration, are the Uniform Rules for the Bank Payment Obligation (URBPO). These are likely to be approved at the April Banking Commission meeting in Lisbon.

URBPO is not an electronic letter of credit or a letter of credit lite, but a trade settlement product that can be used open account or collection type transactions and sometimes when a letter of credit structure could be converted into a BPO product. The rules have been developed as technology neutral. There are 17 articles in URBPO following established protocols of existing ICC rules. Though at present only a limited number of banks are set up to do BPO transactions, this number is likely to multiply once the rules are approved.

The third set of rules, DOCDEX, were first promulgated in 1997, then amended in 2002 to allow expert decisions on ICC's Uniform Rules for Demand Guarantees and its Uniform Rules for Collections. DOCDEX was set up to provide rapid, low-cost expert panel decisions to resolve trade finance disputes based on the ICC rules. It has had a certain success, but the feeling is the process could be improved. Some of the suggestions at the Mexico Commission meeting were to enlarge the scope of DOCDEX to include all disputes related to trade finance and to improve the process of choosing the right experts for the DOCDEX expert panels.

It's not clear what shape the revision will take, but a group of legal experts and bankers has been set up to provide some ideas at the next meeting of the Banking Commission in Lisbon.

Possibly of greater importance to practitioners will be the upcoming revision of the ISBP, now tentatively scheduled for approval in April. Preparation for this new revision has been meticulous; no fewer than five drafts of changes have been submitted to the ISBP Drafting Group and to ICC national committees, reflecting the importance of providing a clear roadmap for document checkers.

Apart from clarifying some of the existing paragraphs of ISBP 681, practitioners are likely to welcome wording dealing with a number of documents not covered in previous versions of the text - packing lists, weight lists, beneficiary's certificates and analysis and inspection certificates. This is a more comprehensive version of the ISBP and is likely to elicit considerable comment once it's approved.

Important organizational changes are also on the drawing board for the Banking Commission. In one, Regional Banking Commissions (RBCs) will be created to improve the Banking Commission's regional outreach. Over the past few years, the ICC Banking Commission's mandates and functions have evolved and expanded. Responding to and influenced by the development of the Commission, the various cooperation arrangements with the Banking Commission have intensified. The RBCs on trade finance will seek to strengthen the Banking Commission's reach at regional level with regional policy makers and associations (including disseminating ICC Banking Commission policy content to regional industry leaders, regulators and governmental officials). RBCs will also seek to develop a mechanism to better understand the regional needs in trade finance.

In another, it was decided to create an Advisory Board, a body advising the Banking Commission's officers and the Secretariat on key strategic visions, issues and opportunities. The Board will be comprised of 15-20 members, all senior executives from the industry or related fields.

All of this will make 2013 a very busy year indeed.