Major Changes In EUCP In Version 2.0 By Md Jashim Uddin, CDCS ...

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International Chamber of Commerce first published eUCP, the Uniform Customs and Practice of Documentary Credits for Electronic Presentation, Version 1.0 on 31 March 2002 and revised with Version 1.1, which was in effect since the implementation of UCP 600 in July 2007.

On 6th June 2017, the ICC Banking Commission announced that they launched a Working Group to anticipate and accompany the digitalization of trade finance, where one core activity was to evaluate existing ICC rules to assess e-compatibility and ensure they are ‘e-compliant’. And they identified that eUCP 1.1 is e-compatible, however an update of the existing content required to ensure compatibility with digital data and to ensure in line with current/evolving market practice.[1] Then it is updated and the new version is called eUCP Version 2.0, which is in effect from July 2019 (ICC Publication no. 639).

eUCP version 2.0 has amendments, enhancements and refinements. 2 (Two) new articles are introduced as Electronic Records and Paper Documents v. Goods, Services or Performance (Article e4) and Force Majeure (Article e14), similar with article 5 and 36 of UCP 600, with Preliminary Considerations (Introduced in eUCP Version 2.0 for the first time) and also 12 articles are from version 1.1 with amendments and refinements.

For reasons of transparency and clarity in mode of presentation, definitions, examination and consistency of eUCP version 2.0, Preliminary Considerations are included. New definitions are incorporated in Article e3 such as “Presenter”, "Data Corruption", "Data Processing System", "Re-present", and “Re-presented" as well as the addition of "data processing system" to the definition of "place for presentation". The definition of "Electronic record" expanded to include logically associated information as well as "Received" now refers to a data processing system, and includes added reference to viewing and examination are added changes in Article e3.

Physical location of banks (issuing bank, confirming bank, nominated bank) is to indicate in the eUCP credit at the time of issuance. If the physical location of any nominated bank and/or confirming bank is not indicated in the credit, such bank must indicate its physical location to the beneficiary no later than the time of advising or confirming the credit (Article e1 (d)). In UCP 600, Physical address is implied, whereas eUCP defines ‘place for presentation’ as an electronic address, not a physical one, and it is essential to ensure compliance with applicable regulatory and sanctions issues.

An electronic record must provide evidence of its date of issuance (Article e10), is now a default rule, whereas identification of certain dates on transport and insurance documents is required in UCP 600. Other documents, such as statements or certifications, must contain a date as stated in ISBP 745 and credits may also contain a specific requirement that a document be dated cause of local authorities’ obligations, applicant obligations, etc.

Banks are liable for their own data processing systems (Article e13 (b)). This disclaimer is emphasized to excuse the responsibility of a bank for its own negligence as modern commercial law allows parties to allocate the risk of negligence.

UCP 600 or eUCP Version 2.0 does not expressly require that documents be presented in one lot but banks commonly expect presentation to be in one single mailing.[1] Thereby, a notice of completeness is must for the presenter (Article e6(c) (i)), was “beneficiary” in eUCP version 1.1, but is not required in the forwarding of electronic records by a nominated bank to a confirming or issuing bank. Moreover, if the expiry date and/or last day for presentation are extended, the nominated bank must provide the issuing bank or confirming bank, if any, with a statement on its covering schedule that the presentation of electronic records was made within the time limits extended in accordance with sub-article e6 (e) (i) (Article e6 (e) (ii)).

If a presentation is considered to be complying by a nominated bank, but is not accessible to the issuing or confirming bank, then the issuing or confirming bank must still honour, negotiate or reimburse (Article e6 (d) (ii)). When an issuing bank issues its eUCP credit and knows that electronic records will be made available for presentation, the issuing bank should be satisfied itself as to the platform, form of hyperlink or external system, where the electronic records will be made available. If there is any doubt, the bank should not issue the eUCP credit in the form requested by the applicant.[1]

While the date of shipment or dispatch is contained in an electronic transport document, ‘Taking in charge’ and ‘goods accepted for carriage’ have been added with the date of shipment or dispatch to make compatibility with UCP 600 (Article e11).

Rest of the amendments in eUCP version 2.0 are minor structural and grammatical changes with heading re-wording, clarifications, deletion or addition of the words for clarifications and clauses movement for relevance.

eUCP version 2.0 is a major milestone in advancing the documentary credit in a digital environment.

[1] Meynell, David (2019). Commentary on eUCP VERSION 2.0 eURC VERSION 1.0 Article-by-Article Analysis. https://cdn.iccwbo.org/content/uploads/sites/3/2019/07/icc-commentary-on-eucp-2-0-and-eurc-1-0-article-by-article-analysis.pdf

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