What is eUCP?
- The focus of the eUCP is concentrated upon the presentation of electronic records, alone or in combination with paper documents, and not to issuance of an eUCP credit.
- The rules are structured to align with UCP 600 and, as such, follow a logical progression.
- First published as version 1.0 on 31 March 2002, a revised version (1.1) was released in conjunction with the implementation of UCP 600 in July 2007. This provided updates in order to bring the rules in line with the changes in terminology in UCP 600.
- The latest version, 2.0, is known as ‘Uniform Customs and Practice for Documentary Credits (UCP 600) Supplement for Electronic Presentations ("eUCP")' and has been in force since 1st July 2019.
- Future versions will be released as and when required according to technological developments.
How is eUCP structured?
The content of eUCP and UCP can be considered as meeting four distinct requirements for electronic presentation:
- Articles of UCP 600 that are not present in eUCP such as those relating to undertakings and obligations of the banks.
- Articles of eUCP concerning electronic records that enhance, but do not conflict with, those in UCP 600 concerning paper documents.
- Articles of eUCP concerning electronic records that differ from those in UCP 600 concerning paper documents.
- Articles of eUCP that change the nature of the UCP 600 rule whether relating to electronic records or paper documents.
The principles on which the rules have been based are the underlying principles in the UCP and standard practice currently existing for eCommerce transactions. As such, most of these principles are reflected in the definitions contained in eUCP Article e3. The definitions are comprised of two distinct parts:
- In the first section, sub-article e3 (a), reference is made to terms that also appear in UCP 600, but have a different meaning when applied to an electronic record presented under an eUCP credit. These include ‘appear on their face', ‘document', ‘place for presentation', ‘presenter', ‘sign', and ‘superimposed, notation or stamped'.
- The second section, sub-article e3 (b), defines terms used solely in the eUCP. These include ‘data corruption', ‘data processing system', ‘electronic record', ‘electronic signature', ‘format', ‘paper document', ‘received', and ‘re-present or re-presented'.
What is the difference between UCP and eUCP?
- A separate comparison document is available in Blog 347. For existing credits subject to UCP 600, if all parties intend to change from paper documents to electronic records, they may do so by agreeing an amendment of the credit from UCP 600 to eUCP Version 2.0. Scanned documents fall within the definition of an ‘electronic record' in eUCP Version 2.0.
Why use eUCP?
- Existing ICC rules, such as UCP 600, whilst being invaluable in a paper world, provide limited protection when applied to electronic transactions.
- It is inevitable that traditional trade instruments will, over time, inexorably move towards a mixed ecosystem of paper and digital, and, ultimately, to electronic records alone. How should we prepare for eUCP?
- Operational - the format of an electronic record is key to the entire process. As stated in eUCP article e5, an eUCP credit must indicate the format of each required electronic record and, if the format is not indicated, it may be presented in any format.
- Technology - essential that internal data processing systems can handle the relevant formats for electronic records, authenticate messages, and execute electronic signatures. In view of the fact that data processing systems are unlikely to be able to access all formats, it is essential that any data received is readable by the relevant data processing system(s). The importance of a format lies in the ability of a data processing system to process data.
- Legal - as far as is known, no conflict exists between the eUCP and eCommerce laws. It should be noted that when there is a mandatory requirement under local electronic commerce law for a higher degree of authenticity than would be required under the eUCP, local electronic commerce law may impose additional requirements on an electronic presentation.
- Customer Agreements - it is important that a review of customer agreements be undertaken in order to ensure that issues such as formats for electronic records, authentication, and electronic signature requirements are covered.
- Electronic Bills of Lading - the ICC Banking Commission, on the recommendation of the Legal Committee, appointed Clyde & Co., to conduct a survey on the legal status of eBL's, whether in the form of an electronic record or in paper format when converted from an electronic record. 
- Risk Management - review handling guidelines in order to account for changes in processing practices for eUCP credits, as well as any additional risks deemed relevant to transaction processing. Banks need to undertake a thorough analysis of the impact on operational risk related to the presentation of electronic records and create new procedures and risk guidelines for these practices.
- Customer Relationship - consider a specific strategy for approaching customers as to their interest and preparedness for eUCP credits. Moving towards a digital environment will result in cost and efficiency savings on all sides, whilst also introducing a competitive advantage.
Any supporting guidelines and materials available?
- An article-by-article analysis of eUCP version 2.0 and eURC version 1.0 to guide practitioners on the new rules. This guidance provides an in-depth explanation for each rule, as well as an outline of the preparation and drafting process.
- Further guidance in respect of handling of the eRules, based on the underlying principles in the UCP and URC and standard practice currently existing for eCommerce transactions.
- An additional guidance paper was released on 7 April 2020 which provided technical guidance to the market on issues of force majeure, elements to consider in modifying ICC rules for specific trade finance instruments, and common scenarios experiences in the delivery of documents during the public health measures undertaken in response to COVID-19.
- New User Guide to be released imminently
- The content of the eRules will be continually monitored in order to ensure applicability.
- These rules provide many benefits in advancing documentary credits and collections in a digital environment and ensuring the continued relevance of these valuable instruments in mitigating trade risk.