|
Intro: Heinz, I know you as an active
commentator in the ICC Banking Commission – with strong and clear views. You
are part of the UCP Revision Consulting Group. In that capacity, you
published an article in the latest issue of DCInsight (Vol. 12 No. 1 March
2006). To me this was very interesting reading, and I would like you to
elaborate on some of the statements presented in this article.
Q1: You address one issue which seems to me
to be constant source for discussions; namely the address. You argue that
the UCP should stick to ISBP paragraph 60 and 61 basically saying that telex
and fax numbers of applicants and beneficiaries as stated in the LC need not
be identical in the documents.
I have heard the argument that a strict
examination of the address will cause problems, because it is impossible for
the document checker to determine what is a spelling mistake – and what is
“another address”. Do you consider this a problem?
Answer:
To begin with I realize that there are areas in the
world where such a problem does not exist because there are mechanisms which
will prevent this situation. I am only talking for these areas where this is
not the case.
No, I do not consider a strict examination of the
address to be a problem because when we talk about possible misspellings in
the address this has to be dealt with as any other possible misspelling in a
document such as in the goods description etc. There is no special problem.
It can only be decided case by case.
But as you can see from my article in DCI it is not
the problem of a possible misspelling I was addressing, it is the problem of
a totally different address which worries me and Austrian banks (also for
legal problems in our country) and several others. What we in Austria are
concerned with is the existing approach in the draft to accept any address
which in our mind is going too far and which fortunately had been taken into
consideration in ISBP (I still remember the controversial discussions we had
in the drafting group of ISBP on that subject where at the beginning the
same approach had been tried which we now have in UCP). We believe that the
situation in the existing draft of the UCP revision may lead to real
problems. However, we are pleased that after all – and this is still within
the latest draft we just received for comment – the consignees and notify
party address has to be as shown in the credit.
Q2: You mention the potential problem, that
you may have two companies having the same name. How big is – in your view –
the probability, that this is in fact the case – and that in such case the
“wrong” company chooses to present documents under the LC?
Answer:
I cannot estimate the probability but even a few
cases would be too many cases.
As far as I remember both in the discussions of the
drafting group of ISBP and of the banking commission the reason for the new
approach was not misspelling but changing address or having sites at
different addresses. But these problems which actually do exist sometimes
could be overcome as I mentioned in my article without opening the door in
UCP for any address with all its possible negative effects.
Q3: You also
mention the possible fraud to be considered. Can you elaborate further on
this? Where is – in your mind – the risk of fraud in this?
Answer:
I do not have a specific case in my mind but I am
sure a criminal mind will find some possibility to use this situation – a
situation which to my mind is not necessary. It is more a bad feeling than
facts because the existing draft in this case seems to me like an open
invitation for bad behaviour. Therefore we should prevent this right from
the beginning.
Q4: Then you address
the issue of the signing of port-to-port bills of lading. Can you briefly
describe the problem, and provide a cautious guess as to which direction
this article will eventually take?
Answer:
The problem which I addressed in my article was that
in the first complete draft of the revised UCP an agent who was signing had
only to mention that he was doing that for or on behalf of the carrier or
the master. As on the other hand there was only the requirement that the
name of the carrier had to be indicated (no requirement for identification
of the name to be that of the carrier) this would have led again to the old
question whether the name appearing on the bill of lading was the name of
the carrier or not.
This problem has been overcome already by the first
complete revised draft which we had to comment on by January 25 and I
believe that nothing has changed in the latest complete draft which we have
to comment on by April 28.
Now – following my suggestion - there is the
requirement that the name of the carrier has to be identified as such.
Q5:
Finally you address the issue of “Road, rail or inland waterway transport” –
and the fact that those are covered by one document. You mention two main
areas; one is the CIM document (railway consignment note) having different
requirements for the indication of carrier – and the other is whether or not
it is possible to determine if the document is original.
Can you comment on how big those problems are
from a practical point of view – and indicate what should be done to fix it.
Answer:
Both problems might become serious problems in
practice with the European documents I mentioned.
1) The first problem of the CIM document was that
the draft of the revised UCP required that the document has to indicate the
name of the carrier, identified as carrier and then dealt with the problem
of a document not indicating the name of the carrier. In case of a CIM
document, however, the problem is not that it does not indicate the name of
the carrier but that it does not identify the name of the carrier which is
actually appearing on the document to be the carrier. But
this seems to have been overcome by the new wording
of the latest draft which reads in line 843 almost as I suggested “If a rail
transport document does not identify the carrier….” instead of “If a rail
transport document does not indicate the name of the carrier….”
2) The second problem of the CIM document still
seems to be valid as there is no change of the wording in the latest draft.
Therefore to my mind there is still a danger of a sophisticated party
considering the word “duplicate railway consignment note” as not being in
line with sub-article (b) of the article on “Original Documents and Copies”
expressing that if a document itself indicates that it is not original a
bank will treat it as not being an original document. Therefore sub-article
(b) of the article on “Road, Rail, or Inland Waterway Transport Documents”
reading “A road, rail or inland waterway transport document will be accepted
as original whether marked original or not” should be extended as I already
suggested in my article.
Q6: Last question –
and a rather theoretical one :-) If you are to rate UCP 500 and UCP 600 (as
you expect it will turn out) on a scale from 1 to 10 – how would you rate
those two sets of rules?
Answer: (assuming
1 is better than 10)
- UCP 500 - (2-3)
- UCP 600 (the first
complete revised draft which we had to comment on by January
25 (the latest one I have not studied yet)) – (5)
(I have no expectation how UCP 600 will turn out
because for me and Austrian banks there are still a lot of items to be
settled (important ones and less important ones).
Kim:
Thank for taking your time.
|
