09/02/2017
Does
it make sense to integrate ISBP with UCP?
This is a comment that has been raised on a
number of occasions since the first version, ISBP 645, was published in 2003.
In fact, there is a simple answer to this
question:
-
UCP 600 article 1 states that the UCP are rules that apply to any
documentary credit.
-
ISBP 745 Preliminary Considerations (ii) states
that the practices within
ISBP highlight how the articles of UCP 600 are to be interpreted and applied.
The publications are separate but also
synonymous:
-
The introduction to UCP 600 states that during
the revision process, notice was taken of the considerable work that had been
completed in creating ISBP and that ISBP had evolved into a necessary companion
to the UCP for determining compliance of documents with the terms and
conditions of a letter of credit.
-
The introduction to ISBP 745 states that it and
the UCP should be read in their entirety and not in isolation, a comment that
is reinforced in ISBP 745 Preliminary Considerations (i), which states that the
publication is to be read in conjunction with UCP 600.
The key issue, in the event of
non-compliance, is to remember that rules must have a consequence; otherwise
the action is a practice. And therein lies the basic differential: rules vs.
practice.
One point
worth noting is that the incorporation of ISBP into the terms of a documentary
credit is inappropriate, as the requirement to follow agreed practices is
implicit in UCP 600.
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