Hi there,
I have been awake all night thinking about UCP article this and that – take up take that and what have we. Should I say “thank you” …or ??
As expected it proved impossible to find a firm definition of the concept “take up”. I have spoken to a number of people, who all have the same “interpretation” as reflected in Jeremy’s postings under this topic. None however was able to produce any evidence. So one conclusion arising from this would be, that a definition could prove helpful.
However: accepting Jeremy’s interpretation of “take up” as a premises, there are still a number of issues. I think that Abdulkader has some very valid points. One is that one thing is to be “nominated” – another thing is whether or not you choose to act in accordance with the nomination. It goes without saying, that if this is not the case then article 13(b) & 14(d) of the ucp 500 is not applicable for that bank. If however the bank chooses to act in accordance with its nomination then they do apply.
Then of course the 1.000.000 $ question is what it takes for the bank to accept its nomination. As has been stated under this topic it must be “expressly agreed to by the nominated bank and so communicated to the beneficiary”. I do not think that it is fair to say, that the examination of the documents is to “expressly agree to e.g. negotiate” (which by the way is in line with ucp 500 article 10(b)(ii))
So I can not interpret it otherwise, than in the “STANDARD” scenario where the dialogue specific to the documents presented, between beneficiary and advising/nominated bank is done AFTER the examination of the documents, then the “express agreement” transforming the advising bank to a nominated bank takes place at THAT point in time, i.e. after examination of documents!
This would of course depend on the wording of the advising letter; i.e. whether or not the bank has “expressly agreed” to e.g. negotiate after presentation of credit compliant documents. In that case – or any other case where the “express agreement” is given PRIOR to the examination of documents, I can not conclude any other way than that bank is bound by that!
So – timing is of essence here! WHEN is the message to the beneficiary turning the advising bank into a nominated bank given?
My guess is, that the reason that this has not (as far as I know) been a problem, is that it is very seldom that documents under an unconfirmed credit are examined by a bank that has put on the “nominated bank hat” (Thanks Abdulkader
Unless of course the L/C is “silent confirmed” or similar – in which case it is a totally different story!
And yes – I know – I accept – now it was me that managed to make everything more complicated than it should be …
I think that is all for now. Have a nice day.
Best regards
Kim
