Can the existing Opinions process be improved?
During the Annual ICC Banking Commission Meeting in Beijing there was a panel discussing “practice”. One of the questions asked at this panel was if the existing “Opinions process” can be improved.
Taking a few steps back; this question seems reasonable. Just think about it: You can ask a UCP related question in a linkedIn Group – and received answer(s) the same day. Or you can ask a question to the lcviews SingleWindow – and received answer within a few days (given the question is in line with the terms and conditions). Raising a Query to the ICC asking for an Official can potentially takes 6 months for the final answer to reach the person asking the question.
However, in many ways the above is not a fair comparison. Please bear the following in mind:
1: Answers from LinkedIn Groups represent only the person giving it. Often more than one answer is given – and often there are conflicting views.
2: Answers from lcviews represent lcviews.
3: Final Opinions from the ICC Banking Commission represent the members of the ICC Banking Commission – and become part of international standard banking practice.
This means of course that a Final Opinion from the ICC Banking Commission has much more “weight” than any LinkedIn answer.
Please bear in mind also, that – in most cases – the ICC Draft Opinions are given within one week. I.e. the ICC National Committee will normally receive the Draft ICC Opinion quite fast. It is a fact that many ICC Opinions are “revised” following comments from the National Committees. However, it is extremely rare that the conclusion is turned 180 degree. Taking the Opinions from the ICC Banking Commission meeting last month in Beijing. It is so that:
3 Draft Opinions were revised – but the conclusion remained the same (TA886rev, TA888rev and TA889rev)
2 Draft Opinions were approved “as is” (TA887 and TA890) – i.e. the Draft Opinion is identical to the Final Opinion.
In other words; although one may potentially wait 6 months to get the Final ICC Opinion – a Draft Opinion (that is likely to stand with the same conclusion) is given quite fast.
With that said, any process could potentially be improved. In order to evaluate this for the purpose of the ICC Opinions, it is important to understand the process. As such – each Opinion goes through four main phases – each of which could be considered a “quality control”:
Phase one: The Query is received by the group of ICC Technical Advisors
Once the Query is received, the Opinion (Analysis and Conclusion) is drafted by the ICC Technical Advisors. Currently there are 3 of those (Senior ICC Technical Advisor David Meynell and ICC Technical Advisors Glenn Ransier and me). I.e. there is a thorough discussion between 3 experts when drafting the initial Draft Opinion.
Phase two: The first Draft is reviewed by the ICC Technical Editor
Following that, that initial Draft Opinion is passed on to the ICC Technical Editor for evaluation. Currently this is Gary Collyer who chaired the UCP 600 and ISBP 745 Drafting Groups.
The purpose of this is to ensure 1) that the language is consistent between the ICC Opinions, 2) that the ICC Opinion is in line with UCP 600 and ISBP 745 and 3) that the ICC Opinion is consistent with other ICC Opinions.
Any comments or concerns goes back to the ICC Technical Advisors for further considerations.
Following that process, the Draft Opinion is forwarded to the ICC National Committee raising the Query.
Phase three: The Draft Opinions are circulated to the National Committees for comments
8 weeks prior to the meeting in the ICC Banking Commission the consolidated ICC Draft Opinions are circulated to the ICC National Committees for comments.
Any comments raised by ICC National Committees must be received by ICC no later than 2 weeks prior to the Commission meeting.
The comments received (normally from 30+ countries) are carefully evaluated by the ICC Technical Advisors, and relevant changes are prepared (in the form of a PowerPoint presentation for the ICC Banking Commission Meeting).
Phase four: The Draft Opinions are discussed, revised and approved by the ICC Banking Commission
At the ICC Banking Commission meeting (bi-annual) the suggested changes to the ICC Draft Opinions (based on the comments received from the ICC National Committees) are presented – and discussed. Often this discussion caters for additional changes to the ICC Draft Opinions.
Following the ICC Banking Commission, the Final ICC Opinions (with the changes agreed to at the meeting) are circulated to the ICC National Committees – and the final version of each is given to the National Committee raising the Query.
As can be seen from the above, each and every ICC Opinion follows a very thorough process, ensuring that the ICC Opinions given by the ICC Banking Commission is of as high quality as possible.
Going back to the question: Can the existing Opinions process be improved?
The answer is: Yes of course – but at a cost.
For example, phase 3 could be changed so that every ICC Draft Opinion is circulated to the ICC National Committees immediately after it is drafted by the ICC Technical Advisors (and reviewed by the ICC Technical Editor). The consequence of this would be that the ICC National Committees would need to set up a structure enabling them to meet (physical or online) within 2 or 3 week – and formulate their comments to the ICC Technical Advisors. The consequence of this would also be that phase 4 would be redundant: I.e. there would be no discussion regarding the Draft Opinions at the ICC Banking Commission meeting.
My personal view is that for the ICC Opinions, the aim is not to be fast – but to be correct. Bear in mind that the Final ICC Opinions are part of international standard banking practice. Therefore, there is a need for a thorough process around them ensuring that the quality is a high as possible. As far as I can see, the discussion at the ICC Banking Commission Meetings actually add value to the ICC Opinions. It is – as such – the final “sign off”.
I am of course open to improving the process around the ICC Opinions – but not at the expense of the quality.
As always – take care of yourself and the LC.
Kind regards
Kim