Seminars will unpack new UCP rules

JOY ORLEK
NEW INTERNATIONAL Chamber of Commerce rules for letters of credit come into effect on July 1, designed to provide more clarity and so reduce discrepancies which delay or invalidate guaranteed payment. A member of the ICC Banking Commission will conduct two seminars on the new Uniform Customs and Practice (UCP) rules for documentary credit on March 1&2 in Johannesburg. And according to Keith Brebnor, CEO of the Chamber of Commerce and Industry – Johannesburg, bankers, importers, exporters and service providers, like forwarders and transporters, should attend. The UCP rules were first introduced in 1933 to create uniformity in banking practices worldwide. They are the standard by which courts worldwide resolve disputes involving letter of credit transactions. Since their inception, they have been updated periodically and this version, UCP 600, is the result of three years of extensive work by experts together with input from ICC national committees, including South Africa. According to Brebnor, the substantive changes introduced in the UCP 600 have resulted in a leaner set of rules that aim to clarify ambiguous terms, amplify definitions, stipulate the time allowed for determining compliance of documents, and resolve the confusion in the identification of carriers and agents. There are new provisions concerning addresses of the beneficiary and the applicant, and the discounting of deferred payment credits among other areas directly affecting the interests and security of both the exporter and importer. The UCP 600 also covers the presentation of documents in electronic or part-electronic format.