The below are intended as an introduction to the content of the rules. More detailed content will be produced in due course.
Can the URDTT be used as a single set of rules to encompass all existing ICC rules such as UCP, URC, URDG etc?
At this stage, there are diverse reasons for the continuing existence for each individual set of rules. In addition, the URDTT do not supplement existing rules that allow for paper - the rules are digital only. This will be monitored as the trade environment evolves.
In the event of possible application of eUCP or other ICC rules (URC, URBPO etc), which rules will prevail in the event of conflict?
With respect to the possible application of other ICC rules, this is not foreseen but, if applicable, should be agreed by buyer and seller.
How do the URDTT fit in with the eUCP Version 2.0?
The scope of the two sets of rules is different. The eUCP is a supplement to UCP designed to accommodate the presentation of electronic documents (e.g. scanned images) under a documentary credit. The eUCP will continue to exist in its own right alongside URDTT.
What is the difference between URDTT and URBPO?
The scope of the URBPO is limited to bank-to-bank undertakings in support of collaboration between participating financial institutions leaving banks to compete in terms of their corporate service agreements.
Why are the rules issued in version numbers?
In order to facilitate regular updates on an ongoing basis and reduce the time required to produce an update/revision.
How is the doctrine of autonomy dealt with by the URDTT?
A Financial Services Provider does not deal with the goods or services to which an electronic record submitted under a Digital Trade Transaction refers.
Why do the rules include Preliminary Considerations?
The precedent for including ‘Preliminary Considerations' was established in ISBP and eUCP, and with the preamble to DOCDEX. The preliminary considerations are listed on a separate page to the rules in order to provide a distinction between the two. For reasons of transparency and clarity, it is considered to be entirely appropriate to provide guidance within the rules in the form of preliminary considerations. An alternative would have been to include the text within a foreword or an introduction. However, whilst it is recognised that all participants to a transaction will always take note of the rules themselves, this cannot be considered to be the same for forewords or introductions, which do not always receive the same level of attention as rules. Accordingly, these provisions are included as ‘Preliminary Considerations'.
Do all parties have to agree to adhere to the URDTT rules before establishment of a transaction? How will these rules be applicable if one party aligns to the rules but the other party does not?
This is a matter of practice. However, it would not make practical sense if any parties involved in a Digital Trade Transaction subject to the URDTT, did not also comply with the rules.
For URDTT to be workable, would all parties need to transact on a single platform?
If applicable, should be agreed by buyer and seller, and will depend on the terms and conditions of the Digital Trade Transaction. Practical issues such as interoperability would require attention.
Can the rules be modified or excluded?
The URDTT are binding on the buyer and seller unless and to the extent expressly modified or excluded by the terms and conditions of a Digital Trade Transaction.
Under a transaction subject to the URDTT, which party is the beneficiary?
The beneficiary is defined as the seller or any other party or person that has acquired the rights and benefits of a Payment Obligation, in whole or in part, as a transferee.
What is the meaning of the term ‘person'?
Such term is defined as any type of person or entity, whether physical, corporate or other legal person or entity.
How is the concept of ‘confirmation' handled under the URDTT?
During the drafting of the rules, it was concluded that the term ‘confirmation' had too many inferences, not only to documentary credits, but also to the paper world. In response to this conclusion, a new term ‘FSP Payment Undertaking' was introduced.
How are originals and copies handled by the URDTT?
Any requirement for submission of one or more originals or copies of an electronic record is satisfied by the submission of one electronic record. An electronic record that incorporates technology that allows a party to distinguish between an original and a copy and provides a means to prove possession of an ‘original' can be used in a DTT.
Does the URDTT prevent fraud?
It would be far more difficult to have fraud in specific electronic records presented under a DTT than in today's paper world, provided that adequate authentication practices are used. That is not to say that fraud can be eliminated from such transactions simply by the use of electronic presentation, but only that the possibilities for fraud become more limited.
In the event of possible application of UNCITRAL Model Law on Electronic Commerce and country laws, which laws will prevail in the event of conflict?
As stated in the rules, the applicable law shall be as specified in the terms and conditions of the Digital Trade Transaction. Furthermore, the rules supplement the choice of the applicable law agreed between the buyer and the seller to the extent not prohibited by, and not in conflict with, that applicable law or any applicable regulation. As with all ICC rules, applicable law will always prevail.
What is the retention period of an electronic record?
This is a matter of practice and/or local law and not to be mandated by the rules.
Does the URDTT allow for partial presentation?
This will depend on the terms and conditions of the Digital Trade Transaction.
How does the URDTT cater for risk participation and distribution.
As with the ICC eRules (eUCP Version 2.0 & eURC Version 1.0) or, indeed, UCP 600, whilst outside the scope of the rules, there is nothing to prevent such risk mitigation methods.
Do the rules address data privacy and data breach?
Both these issues are outside the scope of the rules and will be mandated by market practice. The rules are only concerned with data corruption.
What is data corruption?
This is defined as any distortion or loss of data that renders an electronic record, as submitted, unreadable in whole or in part, as determined by the addressee. If an electronic record appears to have been affected by data corruption, it may be re-submitted
Why has the concept of UTC been used?
As stated in the Preliminary Considerations, the rules are intended for a fully digital environment. As such, it is important that any timescale adheres to a standard which will be consistent globally. UTC is the recognised network time protocol designed to synchronise, with the highest degree of accuracy possible, the clocks and time of computers all over the world. It is the natural choice of time scale for URDTT. UTC is also used in the URBPO and no problems have been recognised to date. Usage of UTC actually makes it easier for parties to control the processing of electronic records, rather than having to rely on differing local times.
Do the rules refer to calendar or banking days?
Both concepts are included, but with separate rationale. A business day is day on which a party or person is regularly open at the place at which an act subject to the URDTT is to be performed by such party or person. Within the URDTT, it is used in respect of non-compliance of an electronic record and data corruption. The term ‘calendar day' is referenced in the Force Majeure article.
UCP 600 allows for a maximum of five banking days following the day of presentation to determine if a presentation is complying. Does a comparable period exist for the URDTT?
The URDTT state that if an electronic record does not comply with the terms and conditions of a Digital Trade Transaction or sub-article 7 (b) of the rules, the submitter must be informed by the addressee of each reason for non-compliance of that electronic record in a single notice sent no later than 23.59.59 UTC on the second business day following the date an electronic record is received.
Is there a difference between an electronic record and an electronic document?
For the purposes of the URDTT, the terms are synonymous and have the same meaning. As stated in the URDTT definitions, the term document shall include an electronic record.
Can the presentation expiry date or payment due date be extended if the date falls on a non-business day?
At this stage, this is not within the scope of the rules and will be addressed as practice evolves. It would be advisable to address such issues within the terms and conditions of the Digital Trade Transaction.
What medium should be used to facilitate digital trade transactions?
As with all ICC rules, the URDTT are technology neutral. The choice of ‘medium' is to be agreed between the buyer and the seller, and it is strongly recommended that the agreed format be stated within the terms and conditions of the Digital Trade Transaction.
How are electronic records / documents to be authenticated?
As with the ICC eRules, it is deliberate that ‘authentication' is not defined. It does, however, link the term to and embody its meaning for purposes of the URDTT in its definition of ‘electronic record'. The basis for this approach is the conviction that any purported definition of ‘authentication' would either unnecessarily duplicate the definition of ‘electronic record' or, even worse, provide a specific link to existing technology. Article 2 indicates what it is necessary for transmitted electronic data to contain in order to become an electronic record under the URDTT. Current and evolving technology allows for numerous commercially reasonable techniques in order to authenticate an electronic record whilst applying the criteria in the URDTT. The Digital Trade Transaction should indicate the level and amount of security to be used in authenticating a message.
Are there industry accepted standards on what constitutes an Electronic Signature?
Standards cannot be mandated by the rules, this is a matter of practice.
How is it determined that a submitter is responsible to ensure that it has the proper authority to submit an electronic record?
Such ‘authority' is not determined by the rules, but by local practice. The rules clarify that a submitter has the responsibility to ensure the authenticity, accuracy and completeness of an electronic record as set out in the terms and conditions of such electronic record, the Digital Trade Transaction to which it refers, or as a result of applicable law or regulations.
What method must the addressee use in order to inform the submitter of non-compliance?
It is not for the rules to mandate specific methods of transmission. This must be agreed between the parties within the terms and conditions of the Digital Trade Transaction.
How should documents not required by the Digital Trade Transaction be handled?
Any electronic record submitted but not required by the terms and conditions of a Digital Trade Transaction may be disregarded and disposed of by an addressee in any manner deemed appropriate without any responsibility. Furthermore, an electronic record submitted but not required by the terms and conditions of a Payment Obligation to which an FSP Payment Undertaking has been added or where it is not required by the terms and conditions of an FSP Payment Undertaking, may be disregarded and disposed of by a Financial Services Provider in any manner deemed appropriate without any responsibility.
Why do the rules not address discounting?
At this stage, this is a matter of practice and not to be mandated by the rules. As practice evolves, this may change.
Can a Bill of Exchange form part of a Digital Trade Transaction?
This cannot be part of the rules, it will be decided by market practice.
A Payment Obligation must include a unique reference linking the Payment Obligation to the Digital Trade Transaction - does this mean that all parties need to link and state this reference number in all communications and actions?
This is a matter of practice, but would be recommended.
How is compliance determined?
Compliance is determined in accordance with the terms and conditions of the Digital Trade Transaction. A Digital Trade Transaction must specify the terms and conditions by which compliance of an Electronic Record will be determined.
What actions must be taken in the event of non-compliance?
The submitter must be informed by the addressee of each reason for non-compliance of an electronic record in a single notice.
Should non-compliance occur, how can it be resolved?
By one of three methods:
If a Principal Party requests a Financial Services Provider to add a payment undertaking, is such party liable for the payment of fees?
This will be contractually agreed and cannot be mandated by the rules.
If the underlying trade is subject to a floating price basis (e.g. oil trade with price escalation/de-escalation clause), can the Finance Provider add its payment undertaking on such transaction while final amount payable is yet to be determined?
To be determined by practice, not by the rules.
In the event of more than one FSP Payment Undertaking added to a Payment Obligation, is there some form of control structure?
If a Financial Services Provider agrees to add a Payment Undertaking, the Principal Party that made the request must, at the time the FSP Payment Undertaking is added, inform the other Principal Party of the name and address of the Financial Services Provider together with details of any limitation as to the liability of that Financial Services Provider, the amount of its FSP Payment Undertaking and, where the Payment Obligation specifies that it is transferable, whether the FSP Payment Undertaking can be transferred.
Can a FSP Payment Undertaking be ‘silent'?
As with UCP 600, this is a matter of market practice, not for the rules.
How is ‘assignment' handled under the URDTT?
Transfer, for the purposes of the URDTT, is equivalent to assignment. The use of the term ‘transfer' is to replace the English law word commonly used of ‘assignment' and is an equivalent right to that of an assignment and covers the transfer of rights and benefits.
Can a DTT be transferred?
Under the URDTT, transfer refers to the transferring of the rights and benefits of a Payment Obligation (in whole or in part) by a Seller or any other Beneficiary to one or more transferees, in accordance with that Payment Obligation and the applicable law.
Where a Payment Obligation and, where added, an FSP Payment Undertaking is specified to be transferable, a Seller or other Beneficiary may effect a Transfer in accordance with that Payment Obligation and, where added, an FSP Payment Undertaking and the applicable law.
What will be the applicable law for a Digital Trade Transaction?
It will be as specified in the terms and conditions of the Digital Trade Transaction.
How will disputes be handled?
The buyer and seller can, if they wish, designate a forum for dispute resolution in the terms and conditions of a Digital Trade Transaction or an FSP Payment Undertaking.
Can a Digital Trade Transaction subject to the URDTT be made subject to the UNCITRAL Model Law on Electronic Commerce?
Whilst this would be of great benefit, the rules cannot mandate for a specific law.
What happens when two jurisdictions are involved but a blocking statute in one jurisdiction conflicts with applicable law in the other?
Such circumstances are a matter of practice and not for the rules. Law will always prevail over rules. As to which particular jurisdiction takes precedence, this cannot possibly be addressed in ICC rules.
Can the rules be more specific with regard to security standards for electronic records?
This is a matter of practice, not for the rules. ICC rules cannot mandate standards.
Does an addressee have a responsibility under URDTT to confirm receipt of an electronic record?
Provision of an acknowledgement of receipt of an electronic record is a practice that cannot be mandated by the rules.
What are the terms of recourse against the transferor?
This is practice, not to be mandated by the rules, and should be dealt with in the underlying Digital Trade Transaction, and remedies available under applicable law.
Do the rules specify that a Digital Trade Transaction should include a maximum duration for force majeure, and, if not, contain a default maximum duration?
This is a matter of practice, not for the rules.
What is the meaning of ‘format'?
The term ‘format' is used in several senses. It can mean the protocol by which data is organised, the version of that format, or the shorthand name by which that protocol is recognised and described. There is no precise distinction between these approaches, and the manner in which it is intended they be used can normally be identified from the context in which they are used. It is recommended that a DTT indicate, with sufficient specificity, the format in which it requires data in any electronic records to be arranged.
Do the rules provide a standard format for electronic records?
Whilst it is agreed that standard formats will be desirable, this is not an issue that can be mandated by ICC rules. The rules must remain technology and platform agnostic.
Do the rules provide a standard format for Payment Obligations?
It is not for ICC rules to propose standard formats. The rules outline the required data elements - how these are included is for the parties involved to decide.
Do checking rules exist for specific types of electronic records?
At this stage, ‘checking' or examination of electronic records is an evolving practice, to a certain extent specific to various technologies and, as such, it would not be appropriate for the rules to mandate practice. This will be considered for any forthcoming guidelines. It is essential that the URDTT remain technology neutral and do not make reference to any ‘platform' checking rules.
How should ‘sanction' clauses be handled?
As with all other ICC rules, this is a matter of practice and cannot be mandated by the URDTT. An FSP should only look to issue its Payment Undertaking when it has satisfied itself of all matters relating to the underlying transaction, including the transaction as a whole and the parties involved i.e., for sanction or other regulatory requirements.
What would happen if one aspect of a digital transaction is inadvertently documented on paper rather than digitally?
This is a ‘practice' issue which cannot be mandated by rules that solely cater for a fully digital environment. It is expected that, in the event part of a transaction ‘converts' to paper, then the involved parties would reach a separate agreement on how to proceed, particularly if such action were ‘inadvertent'.
What is the scope of risk mitigation envisaged in the role of a Financial Services Provider?
This is not an issue that can be limited or mandated by a set of rules; such scope is fluid and evolving. As such, the scope will be determined by any FSP that wishes to provide services to a buyer or seller.
If an electronic signature is recognised by one jurisdiction, but is not recognised by another, would that electronic signature be effective?
It is not for ICC rules to mandate conditions or requirements for electronic signatures; ICC rules must remain neutral.
In respect of an FSP Payment Undertaking, is there any situation that can cancel the payment responsibility?
This is outside the scope of the rules.
How many days does the term ‘without delay' cover?
This is a recognised term within ICC rules, but is deliberately not defined due to the fact that, as stated in various ICC Opinions, the precise interpretation of "without delay" would depend upon the circumstances of each case.