LC called for a Bene. Cert. to certifying something has been done on a certain of period.
The presented Cert. has been signed by Bene. with data contents same as per LC terms but not dated. In addition, no any reference to link with other documents.
As an Issuing Bank, the documents examiners treated 'undated' as a discrepancy with the concept of reasonable care.
In other case, a Sanitary Cert. issued and signed by a Government Authority declaring that the goods are conforming to the CURRENT regulations of the importing country but not dated under various boxes/columns provided in the form.
Once again, the Issuing Bank refuse the documents stating that as an adminstrative document for customs clearance purpose, they are not going to accept the undated snaitary certificate under the protection of UCP500 Art.13-concept of reasonable care
in documents checking.
Would this point of view generally accepted in Gobal Banking Industy?
Undated Certificate and Sanitary Certificate
Undated Certificate and Sanitary Certificate
Sub-Article 13a states:
‘Banks must examine all documents stipulated in the Credit with reasonable care, to ascertain whether or not they appear, on their face, to be in compliance with the terms and conditions of the Credit. Compliance of the stipulated documents on their face with the terms and conditions of the Credit, shall be determined by international standard banking practice as reflected in these Articles.’
Thus, ‘reasonable care’ relates solely to ascertaining facial compliance in accordance ‘with the terms and conditions of the Credit’ and ‘international standard banking practice AS REFLECTED IN [UCP500’s] Articles’ [emphasis added]. It does not relate to anything else. Therefore, sub-Article 13a seems to be saying -from the way it is worded- that:
1. ‘International standard banking practice’ and the Articles of UCP500 are one and the same thing (an approach I appreciate that may not be supported by many documentary practitioners).
2. In order to be discrepant documents can only be in breach of ‘the terms and conditions of the Credit’ and the Articles of UCP500 (which reflect ‘international standard banking practice’).
Therefore, it would seem to me that if one is to strictly apply sub-Article 13a (and I would not be surprised if there were many who contested that one should) a ‘rejecting’ issuing/confirming bank must be able to identify the specific provisions of the credit or UCP500 that have been transgressed with respect to any and every discrepancy raised.
However, the fact is that it is practice to raise discrepancies that are not obviously breaches of ‘the terms and conditions of the Credit’ and the articles UCP500. One example being internal inconsistency within a document, which is not a matter I believe is expressly covered by UCP500 (as opposed to inconsistency between different documents). Nonetheless, it seems to me that where a confirming/issuing back raises a discrepancy that is not literally a breach of ‘the terms and conditions of the Credit’ and the articles UCP500 it could (and I must stress ‘could’) find its position most awkward to defend given the express terms of sub-Article 13a.
I appreciate this may not directly answer your question, but I trust it will assist you in drawing your own conclusions.
‘Banks must examine all documents stipulated in the Credit with reasonable care, to ascertain whether or not they appear, on their face, to be in compliance with the terms and conditions of the Credit. Compliance of the stipulated documents on their face with the terms and conditions of the Credit, shall be determined by international standard banking practice as reflected in these Articles.’
Thus, ‘reasonable care’ relates solely to ascertaining facial compliance in accordance ‘with the terms and conditions of the Credit’ and ‘international standard banking practice AS REFLECTED IN [UCP500’s] Articles’ [emphasis added]. It does not relate to anything else. Therefore, sub-Article 13a seems to be saying -from the way it is worded- that:
1. ‘International standard banking practice’ and the Articles of UCP500 are one and the same thing (an approach I appreciate that may not be supported by many documentary practitioners).
2. In order to be discrepant documents can only be in breach of ‘the terms and conditions of the Credit’ and the Articles of UCP500 (which reflect ‘international standard banking practice’).
Therefore, it would seem to me that if one is to strictly apply sub-Article 13a (and I would not be surprised if there were many who contested that one should) a ‘rejecting’ issuing/confirming bank must be able to identify the specific provisions of the credit or UCP500 that have been transgressed with respect to any and every discrepancy raised.
However, the fact is that it is practice to raise discrepancies that are not obviously breaches of ‘the terms and conditions of the Credit’ and the articles UCP500. One example being internal inconsistency within a document, which is not a matter I believe is expressly covered by UCP500 (as opposed to inconsistency between different documents). Nonetheless, it seems to me that where a confirming/issuing back raises a discrepancy that is not literally a breach of ‘the terms and conditions of the Credit’ and the articles UCP500 it could (and I must stress ‘could’) find its position most awkward to defend given the express terms of sub-Article 13a.
I appreciate this may not directly answer your question, but I trust it will assist you in drawing your own conclusions.
Undated Certificate and Sanitary Certificate
ANOTHER ARTICLE 21 ISSUE
If the certificate states that a certain task has been accomplished on a certain date/period as required in the DC, it has fulfilled the DC requirement in this respect. If there is no requirement in the DC to state a date in that certificate, then it is subject to Article 21 of the UCP 500. Then the answer is: No dating is required.
LINKAGE IS ANOTHER MATTER
For linkage, before we have the opportunity to check for the actual data content of that certificate, we cannot comment. It may and may not have linkage, depending on the content itself.
Requirements by third parties, such as customs, are not DC requirements per se, on which examination of documents is based.
Again, why not search for the ICC opinions in the DC Pro to get your support?
We are from http://www.tolee.com
[edited 8/21/01 12:15:19 AM]
If the certificate states that a certain task has been accomplished on a certain date/period as required in the DC, it has fulfilled the DC requirement in this respect. If there is no requirement in the DC to state a date in that certificate, then it is subject to Article 21 of the UCP 500. Then the answer is: No dating is required.
LINKAGE IS ANOTHER MATTER
For linkage, before we have the opportunity to check for the actual data content of that certificate, we cannot comment. It may and may not have linkage, depending on the content itself.
Requirements by third parties, such as customs, are not DC requirements per se, on which examination of documents is based.
Again, why not search for the ICC opinions in the DC Pro to get your support?
We are from http://www.tolee.com
[edited 8/21/01 12:15:19 AM]
Undated Certificate and Sanitary Certificate
With many thanks to the editor in response my query.
Dear Mr. Lee, I am one of the usual reader to your articles posted in the press and ICC Publications. Referring to your previous discussion on DATE OF PHYTOSANITARY CERT. regarding the issuance date of the certificate that to be dated before shipment or not, it seems that the date on the phytosanitary certificate is one of the important point to justify the document whether compliant or not.
So, what is your viewpoint on a sanitary certificate that is not dated as the the box or column already provided in the form for insertion of a date is missing.
Of course, I know any response is just a kind of personal opinion and makes no impact but I would like to have more viewpoints from the public.
Dear Mr. Lee, I am one of the usual reader to your articles posted in the press and ICC Publications. Referring to your previous discussion on DATE OF PHYTOSANITARY CERT. regarding the issuance date of the certificate that to be dated before shipment or not, it seems that the date on the phytosanitary certificate is one of the important point to justify the document whether compliant or not.
So, what is your viewpoint on a sanitary certificate that is not dated as the the box or column already provided in the form for insertion of a date is missing.
Of course, I know any response is just a kind of personal opinion and makes no impact but I would like to have more viewpoints from the public.
Undated Certificate and Sanitary Certificate
ALL CERTIFICATES ARE SUBJECT TO ARTICLE 21
Mr. H. Leung, thanks for your kind words. We assume that by "articles posted in the press", you mean our Friday column in the Hong Kong Economic Journal in Hong Kong, where I was originally from.
A certificate, however named, is always subject to Article 21 of the UCP 500. My previous comments on this query still apply to any certificate.
A BOX IN A DOCUMENT DOES NOT MEAN THAT IT MUST BE FILLED UP
If Mr. Leung cares to search for the supporting ICC Opinions in the DC Pro, he may find that in one ICC Opinion, the ICC Banking Commission considers that a box (such as a "Date" Box) in a document does not mean that that particular box MUST be filled in order to comply. There is no such rule in the UCP 500. This is simple common sense, where document checking is all about, according to the late Bernard S. Wheble.
OUR OPINIONS IN DC PRO
Mr. Leung, there are certian opinions that are not appropriate for publishing in the DC Pro due to the following reasons:
(1) Mr. Pavel Andrle has already criticised us for too long explanations. For complex issues, we cannot explain clearly without a lengthy statement to avoid misinterpretation.
(2) The DC Pro is considered "public" and an opinion may carry legal consequences. Both the author and the DC Pro editor or owner may be exposed to libel charges if any message is considered to cause harm to other members or organisations. Personal opinion may not be a defence. Fair comments may be a defence but how can one be so sure that his opinions are "fair" - to what extent?
(3) Certain opinions should be better dealt with in the training workshops.
We do not wish to continue in order to keep this message brief.
We are from
http://www.tolee.com
[edited 8/21/01 5:18:38 AM]
Mr. H. Leung, thanks for your kind words. We assume that by "articles posted in the press", you mean our Friday column in the Hong Kong Economic Journal in Hong Kong, where I was originally from.
A certificate, however named, is always subject to Article 21 of the UCP 500. My previous comments on this query still apply to any certificate.
A BOX IN A DOCUMENT DOES NOT MEAN THAT IT MUST BE FILLED UP
If Mr. Leung cares to search for the supporting ICC Opinions in the DC Pro, he may find that in one ICC Opinion, the ICC Banking Commission considers that a box (such as a "Date" Box) in a document does not mean that that particular box MUST be filled in order to comply. There is no such rule in the UCP 500. This is simple common sense, where document checking is all about, according to the late Bernard S. Wheble.
OUR OPINIONS IN DC PRO
Mr. Leung, there are certian opinions that are not appropriate for publishing in the DC Pro due to the following reasons:
(1) Mr. Pavel Andrle has already criticised us for too long explanations. For complex issues, we cannot explain clearly without a lengthy statement to avoid misinterpretation.
(2) The DC Pro is considered "public" and an opinion may carry legal consequences. Both the author and the DC Pro editor or owner may be exposed to libel charges if any message is considered to cause harm to other members or organisations. Personal opinion may not be a defence. Fair comments may be a defence but how can one be so sure that his opinions are "fair" - to what extent?
(3) Certain opinions should be better dealt with in the training workshops.
We do not wish to continue in order to keep this message brief.
We are from
http://www.tolee.com
[edited 8/21/01 5:18:38 AM]