Comments to UCP Revision - June 2006 Draft

Comments to UCP Revision
- June 2006 Draft

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25 June 2006

To: The Chair and Members
Canadian Working Party on the
ICC Commission on Banking Technique and Practice

Dear All,
Below are my comments to UCP 600 June 2006 draft.

Line Numbers Comments

56 Add "confirming bank" after "issuing bank". For a confirmed credit, presentation should be made firstly to the confirming bank. Please also clarify whether a confirming bank has a specific role by itself or considered merely as a nominated bank in the UCP 600. We do not see the role of a confirming bank being clearly defined in the new articles, whether expressly or implied. This may lead to later confusions and disputes.

262 The word "or" immediately after "credit" should be replaced with a comma "," to be consistent with the style in lines such as 543 and 1040 where a comma is used instead of using three "or"s.

317 Add "also" after "is" to highlight that a confirming bank has its specific role, not being just another nominated bank.

415 Delete "within the same country" because an address is either important or not important. It has nothing to do with a country.

428 Add "22" after "21" as a charter party bill of lading may also be issued by owner or charterer.

453 The word "decide" should be "decides" as the subject "issuing bank" is in singular number.

458 Replace "each discrepancy" with "all discrepancies" to highlight that all discrepancies must be included in the notice of refusal.

553 "Shipped" should be replaced with "loading" or "loaded" to be consistent with shipping practice where the notation bears the words "LOADED ON BOARD". In fact "bill of lading" means "bill of loading". UCP 600 uses the term "port of loading" and not "port of shipment". So "loading" or "loaded" should replace "shipment" in the transport articles because the terminology used must be consistent amongst the articles.

556 & 558 "Shipped" should be replaced with "loading" or "loaded" to be consistent with shipping practice for reasons already explained above.

579 Before "transport documents" add "multimodal" because this article refers to multimodal transport documents. Similarly in various sub-articles, before "transport document(s)" add "multimodal" for the same reason.

617 & 685 Change "date of shipment" to "date of loading on board" to be consistent with shipping practice where the notation bears the words "ON BOARD" and not "SHIPMENT". Similar changes have to be made in other articles covering chartered party bill of lading and sea waybill.

704 & 705 The wording should be changed to "Any one original sea waybill presented will be deemed to be the full set" to match the prevailing shipping practice.

766 Add "and the port of loading" after "The port of discharge" to match the prevailing maritime chartering practice. In a charter party, there is a standard term named "optional ports" where the charterer is free to choose a range of ports of loading as well as a range of ports of discharge upon payment of additional chartering fees. This arrangement is to serve commodity brokers who do not know whether cargoes from one port of loading would fill up the whole chartered vessel. Commodity products are highly affected by weather and the harvest may not be perfectly predicable. So the charterer needs to provide a range of ports of loading to make sure that the chartered vessel could be filled up to her full carriage capacity in a voyage charter. Otherwise the charterer has to pay for the "dead freight" or freight for unutilized cargo space.

896 Add "Unless the shipment is by containerized vessel" before "A transport document must not indicate..." to reflect the market reality. Containerized vessel nowadays is carrying about 70 per cent of her containers over the deck or on board, with one container being stacked up on top of another. So on deck shipment was only a concern in break bulk shipments in the past, where cargoes were packed in wooden boxes, cartons, crates or pallets without the protection of containers. It should not be a concern any more in containerized shipments nowadays.

929 to 931 This sub-article should be changed to read "If the insurance document bears linkage to the commercial invoice or the transport document, it should be accepted even if it is issued later than the date of receipt, taking in charge or loading on board" or similar wordings to reflect the cargo insurance principle as reflected in the Transit Clause in the Institute Cargo Clauses (A), (B) and (C) where the effectiveness of a cargo insurance document is based on a specified event rather than its date of issue.

981 "Articles" should be in singular, being "Article", to be consistent with words in singular like "Amount" and "Quantity" used in the title of this article.

984 The "or" after "credit" should be replaced with a comma, to be consistent with the style in lines 543 and 1040, where a comma is used instead of using three "or"s.

Best regards,
T. O.

Further Comments to this UCP Revision Draft >>

(905) 237-6465

(905) 237-6867

Line Numbers	Comments
56	Add "confirming bank" after "issuing bank". For a confirmed credit, presentation should be made firstly to the confirming bank. Please also clarify whether a confirming bank has a specific role by itself or considered merely as a nominated bank in the UCP 600. We do not see the role of a confirming bank being clearly defined in the new articles, whether expressly or implied. This may lead to later confusions and disputes.
262	The word "or" immediately after "credit" should be replaced with a comma "," to be consistent with the style in lines such as 543 and 1040 where a comma is used instead of using three "or"s.
317	Add "also" after "is" to highlight that a confirming bank has its specific role, not being just another nominated bank.
415	Delete "within the same country" because an address is either important or not important. It has nothing to do with a country.
428	Add "22" after "21" as a charter party bill of lading may also be issued by owner or charterer.
453	The word "decide" should be "decides" as the subject "issuing bank" is in singular number.
458	Replace "each discrepancy" with "all discrepancies" to highlight that all discrepancies must be included in the notice of refusal.
553	"Shipped" should be replaced with "loading" or "loaded" to be consistent with shipping practice where the notation bears the words "LOADED ON BOARD". In fact "bill of lading" means "bill of loading". UCP 600 uses the term "port of loading" and not "port of shipment". So "loading" or "loaded" should replace "shipment" in the transport articles because the terminology used must be consistent amongst the articles.
556 & 558	"Shipped" should be replaced with "loading" or "loaded" to be consistent with shipping practice for reasons already explained above.
579	Before "transport documents" add "multimodal" because this article refers to multimodal transport documents. Similarly in various sub-articles, before "transport document(s)" add "multimodal" for the same reason.
617 & 685	Change "date of shipment" to "date of loading on board" to be consistent with shipping practice where the notation bears the words "ON BOARD" and not "SHIPMENT". Similar changes have to be made in other articles covering chartered party bill of lading and sea waybill.
704 & 705	The wording should be changed to "Any one original sea waybill presented will be deemed to be the full set" to match the prevailing shipping practice.
766	Add "and the port of loading" after "The port of discharge" to match the prevailing maritime chartering practice. In a charter party, there is a standard term named "optional ports" where the charterer is free to choose a range of ports of loading as well as a range of ports of discharge upon payment of additional chartering fees. This arrangement is to serve commodity brokers who do not know whether cargoes from one port of loading would fill up the whole chartered vessel. Commodity products are highly affected by weather and the harvest may not be perfectly predicable. So the charterer needs to provide a range of ports of loading to make sure that the chartered vessel could be filled up to her full carriage capacity in a voyage charter. Otherwise the charterer has to pay for the "dead freight" or freight for unutilized cargo space.
896	Add "Unless the shipment is by containerized vessel" before "A transport document must not indicate..." to reflect the market reality. Containerized vessel nowadays is carrying about 70 per cent of her containers over the deck or on board, with one container being stacked up on top of another. So on deck shipment was only a concern in break bulk shipments in the past, where cargoes were packed in wooden boxes, cartons, crates or pallets without the protection of containers. It should not be a concern any more in containerized shipments nowadays.
929 to 931	This sub-article should be changed to read "If the insurance document bears linkage to the commercial invoice or the transport document, it should be accepted even if it is issued later than the date of receipt, taking in charge or loading on board" or similar wordings to reflect the cargo insurance principle as reflected in the Transit Clause in the Institute Cargo Clauses (A), (B) and (C) where the effectiveness of a cargo insurance document is based on a specified event rather than its date of issue.
981	"Articles" should be in singular, being "Article", to be consistent with words in singular like "Amount" and "Quantity" used in the title of this article.
984	The "or" after "credit" should be replaced with a comma, to be consistent with the style in lines 543 and 1040, where a comma is used instead of using three "or"s.

Comments to UCP Revision- June 2006 Draft

Comments to UCP Revision
- June 2006 Draft