An article-by-article analysis of eUCP variant 2.0 and eURC version 1.0 to explain for the new guidelines.
| Definitions | UCP 600 | eUCP Version 2.0 |
|---|---|---|
| Definitions | Where not defined or amended in the eUCP, definitions given in UCP 600 will continue to apply | Where terms are also used in UCP 600, definitions are updated for application to an electronic record |
| Scope | Paper documents (and electronic records if strictly defined, although UCP 600 only provides limited protection) | Electronic records alone or in combination with paper documents |
| Application | UCP 600 | UCP 600 & eUCP Version 2.0 |
| Relationship | UCP 600 | In event of conflict, eUCP prevails |
| Presentation of only paper documents | UCP 600 | UCP 600 |
| Documents examined on their face | Review of data within a document in order to determine that a presentation complies with international standard banking practice and the principles contained in UCP | Electronic records are examined only for the data received and not the reality that such data represents |
| Document | The term suggests format in a paper medium: unless specifically allowed under the terms and conditions of a UCP 600 credit, it is expected that all presentations under such a credit be in a paper format | Adds the term ‘electronic record’ to the meaning | Place for presentation | The place where the documentary credit is available | Extends the phrase to include an electronic address | Data Processing System | Not necessarily used | A computerised or an electronic or any other automated means used to process and manipulate data, initiate an action or respond to data messages or performances in whole or in part | Electronic signature | Not specifically defined: article 3 highlights that ‘a document may be signed by handwriting, facsimile signature, perforated signature, stamp, symbol, or any other mechanical or electronic method of authentication’ | Data attached to an electronic record with the intent of identifying the signer and authenticating the record | Format | Unless specifically stated otherwise, expected to be paper | The protocol by which data is organised, the version of that format, or the shorthand name by which that protocol is recognised and described | Paper document | Unless otherwise stipulated, assumption is that all ‘documents’ are in a paper medium: however, as is often the case with UCP 600, this fundamental assumption is not stated expressly and, instead, the term ‘document’ is used | Refers to a document in a paper medium, the type of document which is expected to be presented under UCP 600 | Authentication | The process by which the validity of the representations and the paper documents containing them are ascertained: under UCP 600, the level of authentication of paper documents is facial | Identifying the person sending a message and the source of the message, and associating the person authenticating with the content of the message authenticated | Goods, Services or Performance | Banks deal with documents and not with goods, services or performance to which the documents may relate | Also addresses electronic records | Notice of completeness | Not applicable | Presentation does not take place until the presenter provides a notice of completeness to the nominated bank, confirming bank, if any, or to the issuing bank | Time for examination | Once presentation is made to an issuing or confirming bank, the time for examination commences | Electronic records may be presented separately and, even if paper documents are presented in one lot, they must be coordinated with the electronic records: the time for the examination of documents does not commence until the notice of completeness is received | Period for examination | Maximum of five banking days following the day of presentation to determine if a presentation is complying | Remains applicable | Approach by the issuing bank to the applicant in order to seek a waiver of discrepancies | UCP 600 sub-article 16 (b) (Discrepant Documents, Waiver and Notice) | Remains applicable | Notice process for discrepant documents | UCP 600 sub-article 16 (b) (Discrepant Documents, Waiver and Notice) | Remains applicable | Disposition of documents in event no instructions received subsequent to notice of refusal | Paper documents can be held or returned | Paper documents can be held or returned | Originals and copies | UCP 600 sub-articles 17 (b) and (c) | Any requirement for an original is satisfied by the presentation of one electronic record: in the event of a requirement for multiple copies, the condition will be fulfilled by presentation of one electronic record | Date of issuance | Requirement for a document to be dated is with respect to the identification of certain dates on transport and insurance documents. In addition, there are expectations that other documents, such as statements or certifications, must contain a date. ISBP 745 goes into more detail as to documentary requirements under UCP 600. Credits may also contain a specific requirement that a document be dated | Effectively dates electronic records, with the result that all such records must be dated: if there is to be any other way of determining the date of issuance then this will be for the eUCP credit itself to determine | Date of shipment or dispatch or taking in charge or a date the goods were accepted for carriage | Contains elaborate rules for determining the date of shipment or dispatch that are individualised according to the type of transport document involved | Date of shipment is the date in the electronic transport record indicating shipment or dispatch or taking in charge or the goods were accepted for carriage. If there is no date indicating shipment or dispatch or taking in charge or goods accepted for carriage, the date of shipment or dispatch is the date of issuance of the electronic transport record unless there is a notation evidencing shipment or dispatch or taking in charge or goods accepted for carriage | Data corruption | No rule for paper documents that are lost or rendered unreadable by a bank after they have been received; most banks have procedures in place that minimise the consequences of such loss and there is no perceived need for such a rule. These procedures involve refusing payment based on discrepancies in the documents that are presented, requesting a substitute document, or indemnifying the applicant for any harm that may result from the lost document | Provides a method by which corrupted data may be re- presented; based on the assumption that all electronic records are replaceable | Disclaimers | Contains several disclaimers that are also relevant to an eUCP credit | Additionally, disclaims banks’ liability for any divergence from the realities represented in authenticated electronic records | Force Majeure | States the force majeure events for which a bank assumes no liability or responsibility | Extended to cover the inability of a bank to access a data processing system, or a failure of equipment, software or communications network |
ARTICLE E1—SCOPE OF eUCP.
The formal title is ‘Scope of the Uniform Customs and Practice for Documentary Credits (UCP 600) Supplement for Electronic Presentations (“eUCP”)’.
Because of the length of the title, the shorthand acronym “eUCP” is appended.
This abbreviated form employs the usual prefix that is applied to electronic commerce while emphasizing the connection
with the Uniform Customs and Practice.
Although no specific form of reference to the eUCP is mandated (in fact any reference that clearly indicates the eUCP would be adequate), it is recommended that the term “eUCP” be used for reasons of transparency and clarity.
Supplement to UCP 600.
Although the rules do not include a definition of the word ‘supplement’, the intent is that, in practice, they function by reference to UCP 600, and do not stand as a set of self-contained rules, such as ISP98 or URDG 758. The eUCP contains only those requirements deemed necessary to expand or modify UCP 600 in order to facilitate the presentation of electronic records. Accordingly, it is an absolute necessity to read any eUCP article in combination with the analogous UCP 600 article.
The rules will only apply when an electronic record is involved which can be as part of a presentation consisting solely of electronic records, or as part of a mixed presentation with paper documents.
Application.
The eUCP applies when a documentary credit indicates that it is subject to the eUCP. As such, it is expected that an appropriate reference to applicability be apparent.
Version number.
The eUCP is issued in versions, with the current version being Version 2.0. As a matter of good practice, it is always recommended that an eUCP credit indicate the applicable version, rather than leave it open to possible misinterpretation.
Should a version number not be stated, the credit would be subject to the latest version in effect on the date the eUCP credit is issued. Additionally, in the event that a credit is made subject to the eUCP by means of an amendment, and such amendment has been accepted by all relevant parties, the credit would then be subject to the latest version of the eUCP in effect on the date of such amendment.
Amendment to eUCP from UCP 600.
The eUCP makes allowances for a situation wherein a credit subject to UCP 600 may be amended to be subject to eUCP in order to allow for the presentation of electronic records. This can be handled as easily as an issuing bank making a simple statement that the condition of credit is subject to UCP 600 is now replaced by subjectivity to eUCP Version 2.0. However, any such amendment requires careful scrutiny of the credit before being issued. In view of the fact that
the credit was originally issued subject to UCP 600, then it is consequential that the terms and conditions of the credit were originally mandated upon the presentation of paper documents.
As such, the introduction of electronic records requires close assessment in order to ensure there are no potential negative impacts towards the applicant and the parties under the credit.
Location of the Issuing Bank.
It is normal practice that, under UCP 600, a physical location for presentation will be stated within the credit. While ‘place of presentation’ is not formally defined in UCP 600, it means the place where the beneficiary is required or permitted to present documents in order to satisfy the required conditions of the issuer or confirmer’s documentary credit obligation. UCP 600 states that the place of the bank with which the credit is available in the place for presentation. Although not expressly stated,
a physical address is implied. The eUCP defines ‘place for presentation’ as an electronic address. Where an eUCP credit requires or permits the presentation of electronic records, their place of the presentation will typically be to an electronic address
and not a physical one. As such, and in order to allow banks to ensure compliance with applicable regulatory and sanctions issues, it is essential that an eUCP credit also indicate the necessary physical location(s). This also applies to the mixed paper/electronic presentations.
Note regarding Confirmation.
The concept of ‘confirmation’ applies for eUCP credits, as it does for UCP 600 credits. However, an additional reflection for any confirming bank to consider with eUCP credits is that they must take cognizance of any related format and data processing requirements. Inability to comply with such requirements could potentially negate the ability of a bank to be involved in an eUCP credit in the capacity of a confirming bank.
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