As an issuing bank, we quoted discrepancy according to ISBP. The negotiating bank in Armenia stating that our L/C is subject to UCP but not ISBP. We responsed to them that ISBP is referring to 'the international standard banking practice' mentioned under UCP Article 13a.
Is my argument strong enough? How many countries have adopted ISBP?
Universally accepted?
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larryBacon
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Universally accepted?
Discrepancies can only be cited in relation to the UCP, but can be supported by reference to the ISBP. See the second para. of the Foreword of the ISBP which states that it is "a practical complement to UCP 500".
The ISBP is an aid to the correct interpretation of the UCP. As with the UCP, there is no requirement for adoption by any country of the ISBP. It was never intended to supplant any part of the UCP.
The ref in UCP 500 art 13a to international standard banking practice is coincidental with the naming of the ISBP. At the time UCP 500 was written, the ISBP had not been contemplated.
Laurence
The ISBP is an aid to the correct interpretation of the UCP. As with the UCP, there is no requirement for adoption by any country of the ISBP. It was never intended to supplant any part of the UCP.
The ref in UCP 500 art 13a to international standard banking practice is coincidental with the naming of the ISBP. At the time UCP 500 was written, the ISBP had not been contemplated.
Laurence
Universally accepted?
MNg1,
Personally, and without liability / responsibility:
I do feel the arguments that have been raised since the inception of Pub. 645 against quoting the relevant para alone when notifying a discrepancy have been academic and pedantic.
The fact is that Pub. 645 has been approved by the ‘Banking’ Commission, meeting in full session, as reflecting i.s.b.p. for the examination of documents with respect to those matters it covers. Therefore, any aspect of a document that contravenes Pub. 645 must logically be discrepant unless applicable law or the UCP (e.g. sub-Art 28(a)(i) vs para 172) provides otherwise, as where the credit and the UCP are silent or ambiguous i.s.b.p. applies.
In addition, there are a number of matters (rightly) covered by Pub. 645 on which the UCP is -and credits usually are- entirely silent, e.g. sub-para 68b and para 99. If refusing documents for reasons covered by these para’s it is simply impossible to quote a relevant UCP article or –usually- relevant term of the credit. Therefore, I cannot see one can do other than quote the relevant para of Pub. 645.
Therefore, in my opinion, simply quoting the relevant para of Pub. 645 alone when notifying a discrepancy ought not to cause any reasonable person a problem, even where there is a related article of the UCP to which the para relates.
Personally, and without liability / responsibility:
I do feel the arguments that have been raised since the inception of Pub. 645 against quoting the relevant para alone when notifying a discrepancy have been academic and pedantic.
The fact is that Pub. 645 has been approved by the ‘Banking’ Commission, meeting in full session, as reflecting i.s.b.p. for the examination of documents with respect to those matters it covers. Therefore, any aspect of a document that contravenes Pub. 645 must logically be discrepant unless applicable law or the UCP (e.g. sub-Art 28(a)(i) vs para 172) provides otherwise, as where the credit and the UCP are silent or ambiguous i.s.b.p. applies.
In addition, there are a number of matters (rightly) covered by Pub. 645 on which the UCP is -and credits usually are- entirely silent, e.g. sub-para 68b and para 99. If refusing documents for reasons covered by these para’s it is simply impossible to quote a relevant UCP article or –usually- relevant term of the credit. Therefore, I cannot see one can do other than quote the relevant para of Pub. 645.
Therefore, in my opinion, simply quoting the relevant para of Pub. 645 alone when notifying a discrepancy ought not to cause any reasonable person a problem, even where there is a related article of the UCP to which the para relates.
Universally accepted?
ISBP is document approved by the full ICC Banking Commission, so in case of dispute covered expressly by ISBP the court would most likely look at them. The party in dispute with its provision(s) would have to prove that international standard banking practice is different to that expressed in ISBP, which is extremely unlikely. We might on the other hand rather encounter disputes over interpretation of ISBP.
With warm regards,
Pavel Andrle
With warm regards,
Pavel Andrle
Universally accepted?
Presented docs should be examined in accordance with Int.Bank.Prac.
as mentioned in sub art 13a.of UCP
You can use ISBP how the art.s of the UCP should be applied.
Discepancy means the presentation fails to comply the conditions of the L/C or UCP.
While explaining to the other party why the docs are discrepant, you can refer to relevant para of ISBP to support yr decision .This does not make any change to the existing practice or -the discrepancy-
Yahya ,
as mentioned in sub art 13a.of UCP
You can use ISBP how the art.s of the UCP should be applied.
Discepancy means the presentation fails to comply the conditions of the L/C or UCP.
While explaining to the other party why the docs are discrepant, you can refer to relevant para of ISBP to support yr decision .This does not make any change to the existing practice or -the discrepancy-
Yahya ,
Universally accepted?
Yahya,
Sub-Art 13a actually says ‘Compliance … shall be determined by international standard banking practice AS REFLECTED IN THESE ARTICLES’ [emphasis added]. In other words, it does not appear cover i.s.b.p. where the the credit or the UCP is silent or ambiguous (although I am prepared to accept this may have been the drafters’ intent). What it ought to say is something like: ‘Compliance … shall be determined by the express terms of the Credit as supplemented by the UCP but where the Credit or the UCP is silent or ambiguous compliance … shall be determined by international standard banking practice’. I note, with great regret, the highly defective wording of this sentence of sub-Art 13a has been carried forward into the first draft of UCP600.
Jeremy
Sub-Art 13a actually says ‘Compliance … shall be determined by international standard banking practice AS REFLECTED IN THESE ARTICLES’ [emphasis added]. In other words, it does not appear cover i.s.b.p. where the the credit or the UCP is silent or ambiguous (although I am prepared to accept this may have been the drafters’ intent). What it ought to say is something like: ‘Compliance … shall be determined by the express terms of the Credit as supplemented by the UCP but where the Credit or the UCP is silent or ambiguous compliance … shall be determined by international standard banking practice’. I note, with great regret, the highly defective wording of this sentence of sub-Art 13a has been carried forward into the first draft of UCP600.
Jeremy