ICC SEEKS ELECTRONIC SUPPLEMENT TO DOCUMENTARY CREDIT RULES
The International Chamber of Commerce said it expects to update its universally used rules on documentary credits, UPC 500, with a supplement for electronic or partially electronic document presentations.
The ICC's banking commission will vote on the supplement, the UCP Supplement for Electronic Presentation, or eUCP, at its November meeting. If approved, it would come into force in June.
eUCP covers items such as the relationship of the eUCP to UCP 500, electronic formats for electronic documents, amendments, place of presentation and notice of dishonor or preclusion.
The ICC's supplement also attempts to define terms in relation to the electronic world. Terms such as “original documents,” “appears on its face,” and “signed” have different meanings in electronic records than in paper records.
An important definition is for the term “electronic document,” which the current draft of the eUCP defines as “a record created, generated, sent, communicated, received or stored by electronic means.” Electronic records, in the supplement comprise electronic documents received to authenticate a letter of credit.
The supplement is in addition to, and not an amendment of, the UCP 500, said Bill Cameron, of CIBC in Toronto. Parties who use it will have to specifically incorporate the supplement in their credit agreements. Otherwise it “would open the door for unanticipated electronic presentations when the parties and financial institutions may not be in a position to handle them,” Cameron said.