Does the term 'all documents' include drafts?


Our previous blog made reference to a recent ICC Opinion that addressed the non-signing of copy documents under a credit stating that all documents were to be manually signed. The conclusion, in that particular Opinion, was that copy documents do not need to be signed, as supported by international standard banking practice.


A further new ICC Opinion, TA.853rev, focused on a credit that stated that all documents were to show a contract number and date. The nominated bank refused the subsequent presentation of documents on the basis that neither the courier receipt nor the draft showed the contract number and date.


Looking at the courier receipt first, this was easily clarified. The credit required a beneficiary's certificate, certifying that copy documents were sent to the applicant, accompanied by a relevant courier receipt.


The beneficiary's certificate included the requisite data regarding the contract number and date. As stated in a previous ICC Opinion, R696/TA583rev, a ‘beneficiary statement' and an accompanying courier receipt form part of the same documentary requirement. Whilst the former Opinion had been provided in respect of a credit subject to UCP 500, it was concluded that it had equal applicability under UCP 600 and the discrepancy was not valid.


The matter of the draft was not a new one. A previous ICC Opinion, TA.703rev, related to a credit that had called for all documents to be presented in English. In this instance, the draft was completed in a different language. The question was asked as to whether a draft constituted a document under a condition relating to ‘all documents'. The Opinion concluded that in respect of a clause such as "all documents must be issued in English", a draft is not to be considered as within that requirement unless the credit specifically requires the presentation of a draft drawn on the applicant under "documents required".


Although this particular Opinion was not referenced in the new Opinion, a similar approach was taken. It was stated that if the draft was also to show the contract number and date, then this should have been expressly stated in the credit via inclusion of wording such as: ‘All drafts and documents to show  contract number and date.'


It was concluded that the term ‘All documents' does not include a draft. The fact is that a draft is an unconditional order in writing and not a document. If certain information is to appear on a draft, it must be specifically stated in the credit.

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