Isbp 745
Isbp 745
This document is the final version of this paper as produced by the task
force and as it will be voted on in the Commission meeting of 30-31
October. Note that the vote will take place on the afternoon of 30 October
and not on 31 October as in the first provisional agenda sent to you.
Members should compare this version (470/951 rev 4), with the previous
version sent out to you after the spring Banking Commission meeting
(470/951 rev 3). As the authors of this final paper have indicated, they
have done their best to show where the final changes were made, but they
have not been able to produce a blacklined version of the previous
paper, since it was heavily changed and would have been virtually
unreadable. The indications of where changes occurred should be clear in
the present paper.
If any member has lost or misplaced the previous version (470/951 rev 3),
please advise Audrey Di Russo at e-mail ado@iccwbo.org and she will send
you another copy.
Members are also requested to bring all documents to the
meeting. They will NOT be redistributed.
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Introduction
At its May 2000 meeting the Commission on Banking Technique and
Practice of the International Chamber of Commerce (ICC Banking
Commission) established a Task Force to document international standard
banking practice for the examination of documents presented under
documentary credits issued subject to the Uniform Customs and Practice
for Documentary Credits, the International Chamber of Commerces
Publication No. 500 (UCP).
The international standard banking practices documented in this
publication are consistent with the UCP and the Opinions and Decisions of
the ICC Banking Commission. This publication explains how the practices
articulated in the UCP are applied by documentary practioners. This
publication and the UCP should be read in their entirety and not in
isolation.
No single publication can anticipate all the terms or the documents that
may be used in connection with documentary credits or their
interpretation under the UCP and the standard practice it reflects.
However, the Task Force preparing this publication has endeavoured to
cover terms commonly seen on a day-to-day basis and the documents
most often presented under documentary credits.
It should be noted that any term in a documentary credit, which modifies
or affects the applicability of a provision of the UCP may also have an
impact on international standard banking practice. Therefore, in
considering the practices described in this publication, parties must take
into account any term in a documentary credit that expressly excludes or
modifies a provision in an article of the UCP. This principle is implicit
throughout this publication, whether or not stated, but it is sometimes
expressly repeated for purposes of emphasis or for illustration. Where
examples are given, these are solely for the purpose of illustration and are
not exhaustive.
This publication reflects international standard banking practice for all
parties to a documentary credit. Since applicants obligations, rights, and
remedies depend upon their undertaking with the issuing bank, the
performance of the underlying transaction, and the timeliness of any
objection under applicable law and practice, applicants should not assume
that they may rely on these provisions in order to excuse their obligations
to reimburse the issuing bank.
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Shipping Marks
27. The purpose of a shipping mark is to enable identification of a box, bag
or package. If a credit specifies the details of a shipping mark, the
document(s) submitted must exactly replicate it, but additional
information is acceptable provided it is not inconsistent with the credit
terms.
28. Shipping marks contained in some documents often include
information in excess of what would normally be considered shipping
marks, and could include information such as the type of goods,
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Signatures
35. Even if not stated in the Credit, drafts, certificates and declarations by
their nature require a signature. Transport documents and insurance
documents must be signed in accordance with the provisions of the UCP.
36.
The fact that a document has a box or space for signature does not
necessarily mean that such box or space must be completed with a
signature. For example, banks do not require a signature in the area
titled Signature of shipper or their agent, or similar phrases,
commonly found on transport documents such as Air Waybills or Road
Transport Documents. ICC Opinions R 274, R 288, R 371, R 463. If a
document on its face requires a signature for its validity (e.g. this
document is not valid unless signed, or similar terms), it must be
signed.
37.
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42. The use of multiple type styles or font sizes or handwriting in the same
document does not, by itself, signify a correction and/or alteration.
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August 18, the draft should reflect 60 days from the earliest on
board date in a European Port, i.e. August 16.
f)
While the examples refer to bill of lading dates, the same principles
apply to all transport documents.
Maturity Date
50. If a draft states a maturity date by using an actual date, the date must
have been calculated in accordance with the requirements of the
credit.
51. For drafts drawn at XXX days sight, the maturity date is established
as follows:
a) in the case of complying documents, or in the case of noncomplying documents where the drawee bank has not provided a
refusal of documents, the maturity date will be XXX days after the
date of receipt of documents by the drawee bank.
b) in the case of non-complying documents where the drawee bank
has provided a notice of refusal of documents and subsequent
approval, at the latest XXX days after the date of acceptance of
the draft by the drawee bank. The date of acceptance of the draft
must be no later than the date of approval of the documents.
In all cases the drawee bank must advise the maturity date to the
presenter. The calculation of tenor and maturity dates, as shown
above, would also apply to credits designated as being available by
deferred payment., i.e. where there is no requirement for a draft to be
presented by the beneficiary.
Banking Days, Grace Days, Delays in Remittance
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INVOICE
Definition of Invoice
61. A credit requiring an invoice without further definition will be
satisfied by any type of invoice presented (commercial invoice,
customs invoice, tax invoice, final invoice, consular invoice etc.).
However, invoices identified as provisional, pro-forma, or the like
are not acceptable unless specifically authorized in the credit. When a
credit requires presentation of a commercial invoice, a document titled
invoice will be acceptable.
Name and Address
62. An invoice must appear on its face to have been issued by the
beneficiary named in the credit. Telex or fax numbers etc., forming part
of the address, need not be present or, if stated, need not be identical
to that in the credit.
63. An invoice must be made out in the name of the applicant. Telex or fax
numbers etc., forming part of the address, need not be present or, if
stated, need not be identical to that in the credit.
Description of the Goods and Other General Issues Related to
Invoice
64. The description of the goods in the invoice must correspond with the
description in the credit. There is no requirement for a mirror image.
For example, details of the goods may be stated in a number of areas
within the invoice which, when collated together, represents a
description of the goods corresponding to that in the credit. ICC
Opinion R 471
65. The goods description in an invoice must reflect what goods have been
actually shipped. For example, where there are two types of goods
shown in the credit, such as 10 trucks and 5 tractors, an invoice that
reflects only shipment of 4 trucks would be acceptable provided the
credit does not prohibit partial shipment. An invoice showing the
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entire goods description as stated in the credit, then stating what has
actually been shipped, is also acceptable.
66. An invoice must evidence the value of the goods shipped. Unit price(s),
if any, and currency shown in the invoice must agree with that shown
in the credit. The invoice must show any discounts or deductions
required in the credit. The invoice may also evidence a deduction
covering advance payment, discount etc., not stated in the credit.
67. Deleted
68. Detailed mathematical calculations in invoices will not be checked by
banks. Banks are only obliged to check total values against the credit
and/or other documents.
69. If a trade term is part of the goods description in the credit, or stated in
connection with the amount, the invoice must state the trade term
specified, and if the description provides the source of the trade term,
the same source must be identified (e.g. a credit term "CIF Singapore
Incoterms 2000" would not be satisfied by "CIF Singapore Incoterms",
etc.). Charges and costs must be included within the value shown
against the stated trade term in the credit and invoice. Any charges
and costs shown beyond this value are not allowed.
70. Unless required by the credit, an invoice need not be signed or dated.
71. The quantity of merchandise, weights, and measurements shown on
the invoice must be not inconsistent with the same quantities
appearing on other documents.
72. An invoice must not show:
a) over-shipment (except as provided in sub-Article 39b), or
b) merchandise not called for in the credit (including samples,
advertising materials, etc.) even if stated to be free of charge.
73. The quantity of the goods required in the credit may vary within a
tolerance of +/ - 5%. This does not apply if a credit stipulates that the
quantity must not be exceeded or reduced, or if a credit stipulates the
quantity in terms of a stated number of packing units or individual
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Articles 23(d)(i) and (ii), a bill of lading indicating that transhipment will
or may take place will be considered discrepant.
93. If a credit prohibits partial shipments, and more than one set of
original bills of lading are presented covering shipment from one or
more ports of loading (as specifically allowed, or within a given range,
in the credit), such documents are acceptable provided that they cover
the shipment of goods on the same vessel and same voyage and are
destined for the same port of discharge. In the event that more than
one set of bills of lading are presented, and incorporate different dates
of shipment, the latest of these dates of shipment will be taken for the
calculation of any presentation period and must fall on or before the
latest shipment date specified in the credit. Shipment on more than
one vessel is a partial shipment, even if the vessels leave on the same
day for the same destination.
Clean Bills of Lading
94. Clauses or notations on bills of lading which expressly declare a
defective condition of the goods and/or packaging are not acceptable.
Clauses or notations which do not expressly declare a defective
condition of the goods and/or packaging (e.g. packaging may not be
sufficient for the sea voyage), do not constitute a discrepancy. A
statement that the packaging is not sufficient for the sea voyage
would not be acceptable.
95. The word clean need not appear on a bill of lading even though the
credit may require a clean on board bill of lading or one marked
clean on board.
96. If the word "clean" appears on a bill of lading and has been deleted,
the bill of lading will not be deemed to be claused or unclean unless it
specifically bears a clause or notation declaring that the goods or
packaging are defective.
Goods Description
97. A goods description in the bill of lading may be shown in general terms
not inconsistent with that stated in the credit.
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102. If a bill of lading states that the goods in a container are covered by
that bill of lading plus one or more other bills of lading, or words of
similar effect, this means that the entire container is to be
surrendered to the consignee and therefore all bills of lading related
to that container must be presented in order for the container to be
released. Such a bill of lading is not acceptable unless all the bills of
lading form part of the same presentation under the same credit.
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On Board Notations
107. If a pre-printed Shipped on board charter party bill of lading is
presented, its issuance date will be deemed to be the date of
shipment unless it bears an on board notation, in which event the
date of the on board notation will be deemed to be the date of
shipment whether or not the on board date is before or after the
issuance date of the document. ICC Opinion TA 465.
108. Shipped in apparent good order, Laden on board, clean on
board or other phrases incorporating words such as shipped or on
board have the same effect as shipped on board . ICC Opinion TA
465
Ports of Loading and Ports of Discharge
109. If a credit gives a geographical area or range of ports of loading
and/or discharge (e.g. Any European Port), the charter party bill of
lading must indicate the actual port of loading which must be within
the geographical area or range indicated but may show the
geographical area or range of ports as the port of discharge.
Consignee, Order Party, Shipper, Notify Party and Endorsement
110. If a credit requires a charter party bill of lading be consigned to a
named party (e.g. consigned to Bank X, rather than to order or
to order of Bank X) (a straight consignment), the charter party bill
of lading must not contain words such as to order or to order of
that precede the name of that named party, whether typed or preprinted. Likewise, if a credit requires a charter party bill of lading to
be consigned to order or to order of a named party, the bill of
lading must not be consigned straight to the named party.
111. If a charter party bill of lading is issued to order, or to order of the
shipper, it must be endorsed by the shipper. An endorsement
indicating that it is made for or on behalf of the shipper is acceptable.
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112. If a credit does not state a Notify Party(ies), the respective field on the
charter party bill of lading may be left blank or completed in any
manner.
Partial Shipment
113. If a credit prohibits partial shipments, and more than one set of
original charter party bills of lading are presented covering shipment from
one or more ports of loading (as specifically allowed, or within a given
range, in the credit), such documents are acceptable, provided that they
cover the shipment of goods on the same vessel and same voyage and are
destined for the same port of discharge, range of ports or geographical
area. In the event that more than one set of charter party bills of lading
are presented, and incorporate different dates of shipment, the latest of
these dates of shipment will be taken for the calculation of any
presentation period and must fall on or before the latest shipment date
specified in the credit. Shipment on more than one vessel is a partial
shipment, even if the vessels leave on the same day for the same
destination.
Clean Charter Party Bills of Lading
114. Clauses or notations on charter party bills of lading, which expressly
declare a defective condition of the goods and/or packaging are not
acceptable. Clauses or notations that do not expressly declare a
defective condition of the goods and/or packaging (e.g. packaging
may not be sufficient for the sea voyage) do not constitute a
discrepancy. A statement that the packaging is not sufficient for the
sea voyage would not be acceptable.
115. The word clean need not appear on a charter party bill of lading
even though the credit may require a clean on board charter party
bill of lading or one marked clean on board.
116. If the word "clean" appears on a charter party bill of lading and is
deleted, the charter party bill of lading will not be deemed to be
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(FIO) and Free In and Out Stowed (FIOS). A reference in the transport
document to costs which may be levied as a result of a delay in
unloading the goods or after the goods have been unloaded, are not
considered an indication of additional costs in this context.
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having occurred provided the entire journey is covered by one and the
same multimodal transport document
137. If a credit prohibits partial shipments and more than one set of
original multimodal transport documents are presented covering
shipment, dispatch or taking in charge from one or more points of
origin (as specifically allowed or within a given range in the credit),
such documents are acceptable provided that they cover the
movement of goods on the same modes of transport and same
journey and are destined for the same destination. In the event that
more than one set of multimodal transport documents are presented,
and incorporate different dates of shipment, dispatch or taking in
charge, the latest of these dates will be taken for the calculation of
any presentation period and must fall on or before any latest date of
shipment, dispatch or taking in charge specified in the credit.
138.Shipment on more than one means of conveyance (more than one
truck (lorry), vessel, aircraft, etc.) is a partial shipment, even if they
leave on the same day for the same destination.
Clean Multimodal Transport Documents
139. Clauses or notations on multimodal transport documents that
expressly declare a defective condition of the goods and/or packaging
are not acceptable. Clauses or notations that do not expressly declare
a defective condition of the goods and/or packaging (e.g. packaging
may not be sufficient for the journey) do not constitute a
discrepancy. A statement that the packaging is not sufficient for the
journey would not be acceptable.
140. The word clean need not appear on a multimodal transport
document even though the credit may require a clean on board
multimodal transport document or one marked clean on board.
141. If the word clean appears on a multimodal transport document and
has been deleted, the multimodal transport document will not be
deemed to be claused or unclean unless it specifically bears a clause
or notation declaring that the goods or packaging are defective.
Goods Description
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INSURANCE DOCUMENTS
Application of Articles 34 36
[New Paragraph] If a credit requires presentation of an insurance
document, Articles 34 through 36 are applicable
Issuers of Insurance Documents
182. Insurance documents must appear on their face to have been issued
and signed by insurance companies or underwriters or their agents. If
required, all originals must appear to have been countersigned.
183. An insurance document is acceptable if issued on an insurance
brokers stationery, provided the insurance document has been
signed by the insurance company or its agent, or by the underwriter
or its agent. A broker may sign as agent for the named insurance
company or the named underwriter.
Risks to be Covered
184. The insurance document must cover the risks defined in the credit. If
a credit is explicit with regard to risks to be covered, there must be no
exclusions referenced in the document with respect to those risks. If a
credit requires all risks coverage, this is satisfied by the
presentation of an insurance document evidencing any all risks
clause or notation, even if it is stated that certain risks are excluded.
An insurance document indicating that it covers Institute Cargo
Clauses (A) satisfies a condition in a credit calling for an all risks
clause or notation.
185. Insurance covering the same risk for the same shipment must be
covered under one document unless the insurance documents for
partial cover each clearly reflect, by percentage or otherwise, the
value of each insurers cover and that each insurer will bear their
share of the liability severally and without pre-conditions relating to
any other insurance cover that may have been effected for that
shipment. An insurance document that clearly reflects, by
percentage or otherwise, the share of liability that each insurer will
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bear is not acceptable unless the co-insurers clearly state their joint
liability, or the leading insurer states it bears 100% of the covered
risk.
186. The insurance document must show that risks are covered at least
between the point of shipment, dispatch or taking in charge and the
point of discharge or final destination as required by the credit.
Dates
187. Insurance documents must not bear a date of issuance which is later
than the date of loading on board or dispatch or taking in charge of
the goods (as applicable) at the place stated in the credit, unless it
appears from the insurance document that the cover is effective at
the latest from the date of loading on board or dispatch or taking in
charge (as applicable) of the goods at the place stated in the credit.
[New Paragraph] An insurance document that incorporates an expiry date
must clearly indicate that such expiry date relates to the latest date that
loading on board or dispatch or taking in charge of the goods (as
applicable) is to occur, as opposed to an expiry date for the presentation
of any claims thereunder.
Currency and Amount
188. An insurance document must be issued in the currency of, and as a
minimum for the amount required by, the credit. If a credit does not
state a minimum percentage amount, then the minimum insurance
amount must be 110% of the CIF value, or 110% of CIP value. A
requirement for Insurance for 110%, or the like, is deemed to be the
minimum amount of insurance coverage required. The UCP does not
provide for any maximum percentage. (ICC Opinion R 468).
189. Deleted
190. If a credit requires the insurance cover to be irrespective of
percentage, the insurance document must not contain a clause
stating that the insurance cover is subject to franchise or an excess
deductible.
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191. If it is apparent from the credit or from the documents that the final
invoice amount only represents a certain part of the gross value of
the goods (e.g. due to discounts, pre-payments or the like, or because
part of the value of the goods is to be paid at a later date), the
calculation of insurance cover must be based on the full gross value
of the goods. (ICC Opinion R 468 ).
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CERTIFICATE OF ORIGIN
Basic Requirement
194. A requirement for a certificate of origin will be satisfied by the
presentation of a signed, dated document that certifies to the origin
of the goods.
Issuers of Certificates of Origin
195. A certificate of origin must be issued by the party stated in the credit.
However, if a credit requires a certificate of origin to be issued by the
beneficiary, the exporter or the manufacturer, a document issued by
a Chamber of Commerce will be deemed acceptable provided it
clearly identifies the beneficiary, the exporter or the manufacturer as
the case may be. If a credit does not state who is to issue the
certificate, then a document issued by any party, including the
beneficiary, is acceptable.
196. Deleted [covered in general principles]
197. Deleted [covered in general principles]
Contents
198. The certificate of origin must appear to relate to the invoiced goods.
The goods description in the certificate of origin may be shown in
general terms not inconsistent with that stated in the credit or by any
other reference indicating relation to the goods in a required
document.
199. Consignee information, if shown, must not be inconsistent with the
consignee information in the transport document. However, if a credit
requires a transport document to be issued to order, to the order
of shipper, to order of the issuing bank, or consigned to the
issuing bank, the certificate of origin may show the applicant of the
credit, or another party named therein, as consignee. ICC Opinion R
276. If a credit has been transferred, the name of the first beneficiary
as consignee would also be acceptable.
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