ICC's Art of Making UCP vs. International Art of Making International Rules

Why ICC has Closed-Door Policy?
Why No Traders in Drafting Group?
Why ICC has Mismatch between Policy and Practice?

He tells what is not (well) known
He sifts myths from facts
He winnows what is true and significant
This is what T.O. Lee is known for

Basically I agree with Marek's (an outsider not involved in UCP revision) observations on ICC rule making and would like to add my other observations as well.

As a member of the UCP 500 Revision Consulting Group, I often see notices from ICC warning us not to distribute the drafts to anyone else because the drafts are provided for my own private use only, to help me preparing my comments and nothing more. When requested by ICC to give my comments during the drafting stage of other ICC rules, such as ISBP 645, ISP98, eUCP etc. I received similar warnings from ICC. From my exchange of emails with ICC, I was told that ICC did worry that if the drafts were to be distributed freely to the public, some traders, freight forwarders and the like might not realize that they were only drafts and would treat them as new UCP provisions. This would create confusions in the market place.

To avoid such confusions, in the drafting of UCP 600, I note that the later drafts are marked with a water mark "DRAFT" in super size fonts running diagonally from bottom left corner to top right corner across the pages.

Now with the DRAFT watermarks on the drafts, ICC should have no worries in making the drafts available to the public for comments. However, to be fair with ICC, we have to look at the other side of the coin as well. Thousands and thousands of comments are flowing from the ICC National Committees on each draft and this is a very big burden for the members of the UCP 600 Drafting Group. That is the reason why ICC refuses comments from any individual and each individual must present his own comments to his National Committee that will consolidate the comments received before submission to the ICC. This is to avoid duplication and to lighten the work of the Drafting Group. Bear in mind that the work of the Drafting Group is voluntary and without pay. So we should consider this point as well.

As a self-employed, despite being an "UCP activist", I cannot afford both the time and the expenses to travel to four corners of the globe six or more times a year, with each session lasting for one week or more. So the best I could do is to contribute my comments by fax in the past and by email at present. I was told by a former member of the UCP 600 Drafting Group that he had to quit because of the same reason. He is now a member of the UCP 500 Revision Consulting Group, a role that he is more comfortable with.

In principle, I agree with the above comments from Marek, but in practice this may be difficult to achieve. I understand that the other ICC Commissions, such as for transport and cargo insurance, are not enthusiastic in giving comments to the drafts of the UCP. This was so in the drafting of UCP 500 from UCP 400. Hence even if the other ICC Commissions were invited to send observers to the UCP 600 Drafting Group, we might find empty seats in these meetings.

I had already made similar suggestions in my article "Inconsistencies Among Terms Used in ICC Rules", published in Documentary Credits Insight, Volume 6, No. 4. The past Secretary General, Maria Cattuai had written me a letter expressing her concerns, thanks and encouragement, promising me that she would urge closer interaction and communications amongst the ICC Commissions. Since then the situation has improved somehow but not enough is being done. We now see representatives from other ICC Commissions present in the ICC Banking Commission meetings, such as Professor Charles Debattista.

The objectives of the ICC are to promote the UCP and other trade rules. ICC is also a non-profit making organization. However, I observe that some ICC practices are contradictory to the objectives of ICC and not matching the nature of ICC as a non-profit making organization.

ICC claims to own the sole copyrights of all the trade rules, UCP 600 included. However, ICC seems to forget that the UCP 600 is enhanced by contributions from the "UCP activities", like me, who continue to give support through giving comments, opinions and by attending ICC Banking Commission meetings held each year at our own cost. Members of the UCP 500 Revision Drafting and Consulting Groups are also contributing to the drafting of UCP 600. But they are not allowed to use the UCP 600 in their own seminars, workshops or training courses. Those who help to cook the pizza, by providing the flour, eggs, tomatoes, olives, labour etc. are not allowed to touch the pizza, not to mention to share a slice. Is this fair and reasonable to them? However, other trade rules and international conventions, such as those from the United Nations, CISG etc. are free to be downloaded from the respective websites. Such practice fits the objective of the UN to promote the trade rules and conventions.

ICC prohibits speakers to distribute the trade rules, UCP 600 included, in their seminars or training courses. If they wish their seminars or training courses to carry PDU (Professional Development Unit) for exemption in CDCS (Certified Documentary Credit Specialist) re-examination, they have to pay to ICC through IFSA USA or IFS UK a high fee of USD500 for each seminar or training course held in a year. That means if a speaker intends to do the same training course for six times in a year, he has to pay USD3, 000. Such practice is unreasonable. CDCS claims that the fees are cost for screening the contents of the training courses to make sure they comply with the standard required by ICC. If that is the case, then one screening is enough. Repetition should not be charged again for another USD500. Submission of contents must also be made a couple of months ahead. This makes life more difficult for the in-house workshops as their contents are often changed from time to time before the presentation. It appears that ICC is discouraging the promotion of the UCP. Some speakers regard this as ICC seeing them as competitors other than supporters.

Such unreasonable practices may lead us to think that ICC is using them as barriers to stop competition in the market place.

Thanks for your insightful and highly professional comments. As always, I have learnt something new from your contribution. I am glad that we pretty much agree on the points that I raised.

As regards UN Rules, everything is posted on the website, even preliminary drafts. Ravi, you can refer the readers to the uncitral.org website where they can find all materials to the "new" ocean transport convention.

ICC's Art of Making UCP vs. International Art of Making International Rules - Expert Commentary

LC VIEWS, Newsletter No. 59, September 2006