An Opinion relating to this post can be found in the Upublished queries section of DC-PRO by using the search "surveyor".
It is the unpublished query entitled:
"Whether an inspection report signed by a company acting for the insurance agent was discrepant".
ISSUER OF DOCUMENTS
ISSUER OF DOCUMENTS
Many thanks for this. Given the general thrust of the response, I imagine the word ‘not’ in ‘From the text of the query, the report was issued by surveyors acting for Lloyd's agent and would not be acceptable under the terms of the credit.’ is a typographical error.
ISSUER OF DOCUMENTS
Firstly let me make this point: I very much support active approach of bankers towards familirazation with trade practices etc., but I would rather discourage to be too pushy about taking this too much forward.
Secondly we recognize the difference between “issued” and “signed” document. It is not surely the same thing. So if LC calls for an inspection certificate issued by company ABC, my understanding of standard international banking practice is to accept a document named "Inspection Certificate" with data consistent with other presented documents and complying with all LC terms and conditions, being issued on letterhead paper of company ABC or on "neutral" paper with name and address of the company ABC at the heading and also signed by representative of the company ABC (either ABC officer or an agent on behalf or for ABC).
If the LC called for Inspection Certificate issued and signed by company ABC, result would be, in my view, different. In this case only signature of ABC would be acceptable.
Is is quite surprising to see how our opinions differ re. this quite "frequent issue". I hope that ICC will give its clear and precise opinion soon.
Pavel Andrle
Secondly we recognize the difference between “issued” and “signed” document. It is not surely the same thing. So if LC calls for an inspection certificate issued by company ABC, my understanding of standard international banking practice is to accept a document named "Inspection Certificate" with data consistent with other presented documents and complying with all LC terms and conditions, being issued on letterhead paper of company ABC or on "neutral" paper with name and address of the company ABC at the heading and also signed by representative of the company ABC (either ABC officer or an agent on behalf or for ABC).
If the LC called for Inspection Certificate issued and signed by company ABC, result would be, in my view, different. In this case only signature of ABC would be acceptable.
Is is quite surprising to see how our opinions differ re. this quite "frequent issue". I hope that ICC will give its clear and precise opinion soon.
Pavel Andrle
ISSUER OF DOCUMENTS
I’d be grateful if you would let us know what is the source for your understanding of standard international banking practice, regarding the example you have given. It may well be what stimulated me to raise the topic in the first place.
ISSUER OF DOCUMENTS
INTERPRETATION OF "ISSUED" IN SUB ARTICLE 37 (A) (I)
Based on the interpretation of "issued" and "signed" (related to a document) by Mr. Pavel Andrle, if a commercial invoice is "issued" by an AGENT of the beneficiary, it should ALSO comply with UCP 500 sub Article 37 (a) (i).
If Mr. Andrle is right, then should this sub Article be reworded as "issued and signed" rather than only "issued" in the original text?
"ISSUED" AND "SIGNED" APPEAR MORE TO BE A LEGAL ISSUE
We opine that this "issued" and "signed" issue appears more of a legal issue than an "International Standard Banking Practice" issue, becasue it deals with the legal effect or validity, which a banker has no competence, authority or obligation (Article 15 of UCP 500) to adjudicate.
BIRTH OF "SBPED"
To respond to Mr. JSmith's request, a working party appointed by the ICC Banking Commission is now drafting the SBPED (Standard Banking Practice for the Examination of Letter of Credit Documents) which hopefully would be ready for comments and approval by the members of the ICC National Committees in the ICC Banking Commission meeting to be held at Frankfurt in November 2001.
We hope it would cover the "issued" and "signed" issue.
We are from http://www.tolee.com
[edited 9/27/02 11:19:25 PM]
Based on the interpretation of "issued" and "signed" (related to a document) by Mr. Pavel Andrle, if a commercial invoice is "issued" by an AGENT of the beneficiary, it should ALSO comply with UCP 500 sub Article 37 (a) (i).
If Mr. Andrle is right, then should this sub Article be reworded as "issued and signed" rather than only "issued" in the original text?
"ISSUED" AND "SIGNED" APPEAR MORE TO BE A LEGAL ISSUE
We opine that this "issued" and "signed" issue appears more of a legal issue than an "International Standard Banking Practice" issue, becasue it deals with the legal effect or validity, which a banker has no competence, authority or obligation (Article 15 of UCP 500) to adjudicate.
BIRTH OF "SBPED"
To respond to Mr. JSmith's request, a working party appointed by the ICC Banking Commission is now drafting the SBPED (Standard Banking Practice for the Examination of Letter of Credit Documents) which hopefully would be ready for comments and approval by the members of the ICC National Committees in the ICC Banking Commission meeting to be held at Frankfurt in November 2001.
We hope it would cover the "issued" and "signed" issue.
We are from http://www.tolee.com
[edited 9/27/02 11:19:25 PM]
ISSUER OF DOCUMENTS
Thank you for the further contributions.
As Mr. Lee may have guessed, it is the draft of ISBPED that prompted my original query. It seems to me that the ‘Issuer of documents’ section is possibly over restrictive, i.e. it does not reflect the (non-) provisions of UCP500, for the reasons I have given in my various contributions.
So, at the risk of repetition, I believe that there appears to be a strong case for the proposition that a document produced on agent headed note paper and signed for and on behalf of the stipulated party has, on the face of it, been legally ‘issued’ and/or ‘signed’ by the stipulated party. And therefore, if a credit calls for an inspection certificate to be ‘issued’ and/or ‘signed’ by company ABC, an inspection certificate produced on XYZ’s headed note paper and signed by XYZ ‘for and on behalf of’ (for example) ABC should be treated as being facially compliant per sub-Article 13a.
In sum I cannot see:
1. What difference it makes -legally, and thus facially- if a document is produced on agent headed note paper, provided it purports to be ‘signed’ and/or ‘issued’ for and on behalf (or similar) of the stipulated party.
2. Why ‘neutral’ paper should be more acceptable under a credit than agent headed paper, if they are both signed for and on behalf of the stipulated issuer by the agent.
However, as I’ve previously indicated, I’m quite happy to be ‘put straight’ on the subject.
Finally, I must admit I am somewhat surprised that such a matter should require clarification of any sort by the ICC Commission on Banking Technique and Practice, whether in ISBPED or any where else. I would have anticipated the application of fundamental legal and documentary principles -with which I would hope all experienced documentary credit practitioners (world-wide) would be familiar- would quickly resolve the matter.
As Mr. Lee may have guessed, it is the draft of ISBPED that prompted my original query. It seems to me that the ‘Issuer of documents’ section is possibly over restrictive, i.e. it does not reflect the (non-) provisions of UCP500, for the reasons I have given in my various contributions.
So, at the risk of repetition, I believe that there appears to be a strong case for the proposition that a document produced on agent headed note paper and signed for and on behalf of the stipulated party has, on the face of it, been legally ‘issued’ and/or ‘signed’ by the stipulated party. And therefore, if a credit calls for an inspection certificate to be ‘issued’ and/or ‘signed’ by company ABC, an inspection certificate produced on XYZ’s headed note paper and signed by XYZ ‘for and on behalf of’ (for example) ABC should be treated as being facially compliant per sub-Article 13a.
In sum I cannot see:
1. What difference it makes -legally, and thus facially- if a document is produced on agent headed note paper, provided it purports to be ‘signed’ and/or ‘issued’ for and on behalf (or similar) of the stipulated party.
2. Why ‘neutral’ paper should be more acceptable under a credit than agent headed paper, if they are both signed for and on behalf of the stipulated issuer by the agent.
However, as I’ve previously indicated, I’m quite happy to be ‘put straight’ on the subject.
Finally, I must admit I am somewhat surprised that such a matter should require clarification of any sort by the ICC Commission on Banking Technique and Practice, whether in ISBPED or any where else. I would have anticipated the application of fundamental legal and documentary principles -with which I would hope all experienced documentary credit practitioners (world-wide) would be familiar- would quickly resolve the matter.