ICC Digital Library Forum

Dear Kim,

My second part of the posting is related to the first one and I thought by indicating the expression "in this case" the second part would be linked to the first. I had no intention to make the 2nd part be read independent of the 1st.

Agree with you that in case a transport document is not called under a credit and the credit does not also give any guidance on which other required document under the credit should the shipment date be shown, Bene may ignore the requirement as it is no more considered to be documentary. However, if Bene opted to mention a shipment date but mentions a wrong one on an invoice or any other document, then Bene is taking the risk that a bank, such as the issuing or confirming bank may use it as the basis to refuse the documents and deny Bene from payment.

My message here is even if the LC does not call for a transport document but mentions a latest date of shipment, Bene may not show a wrong date of shipment in any of the documents. If it does a bank has the right to either ignore looking for shipment date in any of the documents or may decide to look for it and use the wrong shipment date as the basis to refuse payment.

On the other hand, if a credit calls for a copy of a transport document, I would consider this condition as a guidance by the issuer of the credit on where the shipment date is to be mentioned and thus a wrong shipment date on a copy of transport document would not be acceptable.

Regards
Abdulkader
[edited 6/15/2007 9:00:19 PM]

Dear Abdulkader,

I see your point – sorry for the misunderstanding.

I understand your argumentation – but am not sure that I agree with you all the way.

However – this string of postings shows clearly how careful a bank should be when drafting the LC text – and how important it is to be clear – and draft requirements that support the intention.

Feel like making one more comment on the case where the “shipment” date is mentioned on the invoice. One thing is where the word “shipment” has been used – in that case I can understand that you can argue for late shipment. It is my impression though – that such information may be written in a number of ways – using all sorts of words/phrases – like:

Delivered
Sent
ETD
Dispatched
Pick up date

To me it would be hard to link such words with “shipment as per UCP”.

Best regards
Kim

Dear Kim,

I agree with you that in the absence of original or copy of transport document and in the absence of clear guidance by the LC, unless the expression"shipment date" is used in any of the other documents, it would, generally, be difficult to determine the actual shipment date. This could perhaps lead to serious controversies.

Therefore, I would agree with you that the instructions given in the LC must be clear, complete and precise. In this regard, we may soon be missing article 5 (a) and (b) of UCP 500.

In additions, if beneficiaries voluntarily provide information that they could avoid, then they (beneficiaries) maybe prone to unanticipated risks due to, among other things, possible wrong interpretation of the additional information provided. Sometimes ago, I remember reading a good article on one of the old LC Publications, maybe it was LC Update, which I believe had a title similar to "Don't Add Libs".



regards
Abdulkader

[edited 6/19/2007 5:04:52 AM]

Hello All,

Been disgustingly busy of late. My views are:

1. Where a credit stipulates a copy transport document it undoubtedly has to be examined in accordance with UCP500 Article 21 unless it stipulates by whom the (original, in this case) document must be issued and its wording or data content. (This is reinforced in para 21 of ISBP645.)

2. The credit did not expressly state that the date of shipment was to be stated in the original document of which a copy was required.

3. Therefore, the LSD is a non-documentary condition -and as a result MUST be completely disregarded irrespective of the presented documents’ contents- unless it can by ‘clearly linked’, per PP3, with the ‘Copy transport document’.

4. Given what ISBP645 para 21 has to say, particularly that ‘copies (non-negotiable) … need not evidence signature, DATES, etc.’ [my emphasis] everything points to the LSD being a NDC.

Regards, Jeremy

[edited 6/20/2007 2:34:55 PM]

Jeremy,
My initial reaction also, but considering the UCP 600 provisions I wonder if we can apply the same logic going forward. sub art 14d does not seem to support this view, it states “Data in a document, when read in context with the credit, the document itself and international standard banking practice, need not be identical to, but must not conflict with, data in that document, any other stipulated document or the credit.”
Regards
Khalid

Khalid,

If something is a NDC per 14(h) a bank has NO choice but to ‘deem’ it ‘as not stated’ and to ‘disregard it’. If something is ‘not stated’ and has to be ‘disregarded’ by definition NO data in a document can conflict with it; a NDC HAS to be treated as if a big black line has been put through it rendering it illegible. Therefore, I see no basis for considering 14(d) as being of any relevance.

Where I see a problem is how to interpret 14(h) has been rendered uncertain, in my opinion, by the statement in the introduction to 600 that the position papers are not ‘applicable’.

Regards, Jeremy

[edited 6/21/2007 2:10:06 PM: 'not' omitted]

I disagree with the view "NDC" where a credit states a latest date of shipment and requires copy of a transport doc.
As I mentioned in my previous post that If copy of a TD does not bear a shipment date (as you did not require in the credit)
You have no data to determine a shipment date.But in this case you have a shipment date which signifies that the shipment has been delayed. And you can't ignore this fact under the concept that copies of TD are not TD defined in UCP arts.

In my view , the doc is discrepant on the basis of late shipment.

Regards,

Jeremy,
I totally agree with you on the interpretation of NDC, but for me 14d conflicts with 14h as I am not too sure how to ignore “data in the credit” under 14d if I have to apply the NDC rule under 14h.
Regards, Khalid

Yahya,

I can only say if a 'condition' is a NDC a bank MUST disregard it. If a credit states goods must be of German origin without stipulating a c/o and the invoice presented says the goods are of French origin this is not a discrepancy. See PP3. The position is no different regarding the example you give.

Khalid,

I personally do not see any inconsistency or conflict [!] between 14(d) & 14(h) but I accept others are less clear on this point.

Regards, Jeremy

Jeremy,
Your explanation is still based on the assumption that the condition is a NDC. I have no objection to your views and examples regarding NDCs but in my view , this is NOT a NDC and in this case , a stipulated doc even being a copy contains a data which shows breach of a condition of the credit.

Regards,
Yahya

[edited 6/21/2007 3:05:02 PM]