To be discussed on 9 November at the London meeting.
TA.965 - Five Powers War Clause
The credit required an insurance policy covering all risks, including Institute War, Strike, Riots and Civil Commotion Clauses, and expressly stipulated that there must be no exclusions in respect of the risks required by the credit. The insurance policy indicated that war risks were covered but also contained the words "Five Powers War Clause", without reproducing or explaining the content of that clause. External research by the submitting party indicated that the clause is generally understood to exclude losses arising from war involving certain major powers.
The query asks whether the reference to the "Five Powers War Clause" contradicts the required war risk coverage or restricts the insurance cover contrary to the terms of the credit and, consequently, whether the presentation is discrepant. The central issue is whether a bank can treat the reference as an exclusion when its operative wording does not appear in the insurance document itself.
TA.966 - Advising a credit directly despite Field 57A
A documentary credit nominated and confirmed BANK A and stated BANK A's country as the place of expiry, but Field 57A identified BANK B as the bank through which the credit was to be advised. BANK A did not wish to advise the credit through BANK B. The beneficiary, who had a direct relationship with BANK A, asked BANK A instead to advise the credit directly. BANK A considered that it was required to follow the issuing bank's authenticated routing instruction unless it received an amendment or further authenticated instruction.
The beneficiary argued that UCP 600 article 9 permits, rather than requires, the use of another bank for advising and that BANK A could therefore advise the credit directly while informing the issuing bank. The query asks whether BANK A is permitted under UCP 600 to advise the credit directly to the beneficiary notwithstanding the identification of BANK B in Field 57A.
TA.967 - Identification of a container number
The credit required the bill of lading to indicate the container number and seal number. On an attached page forming part of the bill of lading, an alphanumeric reference, "HASU4556268", appeared immediately alongside "1 40' HC CONTAINER SAID TO CONTAIN...", while the corresponding seal number was expressly identified by the prefix "SEAL:". The issuing bank considered the bill of lading discrepant because the container number was not expressly identified as such.
The nominated bank disagreed, arguing that the alphanumeric reference was identifiable as the container number from its format, position and relationship with the surrounding wording, and that the credit did not require the words "container number" to appear as a label. The query therefore asks whether the bill of lading sufficiently indicates the container number and complies with the credit despite the absence of an express field heading or prefix.
TA.968 - War risk exclusions and the route of transport
The credit required an insurance certificate covering marine/air risk and war risk "without any exclusion", together with all-risks cover. The insurance document stated that war risks were covered under the applicable Institute War Clauses but expressly excluded specified territories and sea areas, including parts of Ukraine and Russia and certain waters. Shipment was by air, and the confirming bank argued that the geographical exclusions were irrelevant because the actual flight route did not pass through the excluded areas. The issuing bank refused the presentation because the insurance document contained exclusions relating to the required war risk cover.
The query principally asks whether the insurance document complies notwithstanding those exclusions and whether the issuing bank must reimburse the confirming bank. It also asks whether the relevance of territorial exclusions should be assessed according to the actual or apparent route for air, sea or land transport, and what alternative credit or insurance wording could avoid such a discrepancy while accommodating standard market exclusions.