UCP 500 Article 1

UCP 600 Article 1

No formal status was given, only stating that they would apply to documentary credit. However, courts would generally find that they would apply when expressly stated or by implication.

These Articles are now ‘rules’. Once they are referred to in the credit documents, they are binding on all parties, unless excluded or modified by the credit document. Probably this would reinforce the legal status of the provisions.

UCP 500 Article 2

UCP 600 Article 2

Only the meaning of Credit was defined.

Article 2 introduces new definitions section. Particularly the meaning of ‘Honor’, ‘Negotiation’ and ‘Presentation’ has been defined among others. This was a prime area of uncertainty in the previous version.

No corresponding Article in UCP500

UCP 600 Article 3

By Article 3 there is now a new section on Interpretations. It clarifies certain procedural matters and interpretation of various commonly used yet misunderstood terms.

UCP 500 Article 13(b) and 14 (d)

UCP 600 Article 14(b) and 16(d)

In UCP 500, the stipulated time was ‘reasonable time not exceeding seven days’. This created much confusion.

Under Article 14 (b) Five Banking days are now the maximum for determining whether a presentation complies. Banks will now have to settle the issue within this period.

UCP 500 Article 37(in part)

UCP 600 Article 14(j)

Commercial invoices must appear on their face to be issued by the Beneficiary name din the Credit and must be made out in the name of the Applicant…

Under Article 14 (j), the address provision for documentary credits has been relaxed. Now it is sufficient if the beneficiary’s addresses in different documents are within the same country.

UCP 500 Article 14 (d)

UCP 600 Article 16(c)

If the Issuing Bank and/or Confirming Bank or Nominated Bank decided to refuse the documents, it must give notice to that effect…

As per Article 16 (c), if a bank decides to refuse documents because of discrepancies, it can hold the documents pending further instructions from the presenter or until it receives a waiver from the applicant and agrees to accept it and give notice to that effect.

UCP 500 Article 10(d)

UCP 600 Article 12(b)

By nominating another bank, or by allowing for negotiation by any bank, or by authorizing or requesting another bank to add its confirmation, the Issuing Bank authorizes such a bank to pay, accept draft(s), or negotiate as the case may be, against documents which appear on their face to be in compliance with the terms and conditions of the Credit and undertakes to reimburse such bank in accordance with the provisions of these Articles.

As per Article 12 (b), By nominating a bank to accept a draft or incur a deferred payment undertaking, an issuing bank authorizes that nominated bank to prepay or purchase a a draft accepted or a deferred payment undertaking incurred by that nominated bank.

UCP 500 Article 21

UCP 600 Article 14(d)

There must not be inconsistencies between data content of one document with another.

Article 14 (d) states that data in the credit, other documents and international banking practice need not be identical but also must not conflict with each other.

UCP 500 Article 16 (in part)

UCP 600 Article 35 (in part)

Banks assume no liability or responsibility for the consequences arising out of delay and/or loss in transit of any message(s), letter(s) or document(s), or for delay, mutilation or other error(s) arising in the transmission of any telecommunication.

Article 35 (in part) states that if a presentation is complying then if the documents are lost during transit between banks, the issuing or confirming bank must honour, negotiate or reimburse the credit. Admittedly, this is much more logical than the previous version.

UCP 500 Article 26(a) (in part)

UCP 600 Article 19(a)

If the Credit called for a transport document covering at least two different modes of transport, then this section would apply.

Article 19 (in part) now gives different description of multimodal transport shipments. The credit need not call for a transport document to cover different modes of transport.

UCP 500 Article 23(a) (in part)

UCP 600 Article 20(a) (in part)

If a Credit calls for a bill of lading covering a port-to-port shipment, banks will, unless otherwise stipulated in the Credit, accept a document, however named, which…

Article 20(a) simplifies provision for Bill of Lading which includes port-to-port shipments.

UCP 500 Article 20 (b)

UCP 600 Article 17

Unless otherwise stipulated in the Credit, banks will accept as an original document, a document produced as a copy provided that it is marked as original and appears to be signed.

Under the new rule in Article 17, a document bearing an apparently original signature, mark stamp or label of the issuer would be accepted as original document.

UCP 500 Article 13

UCP 600 Article 14

Referred to ‘reasonable care’ and ‘reasonable time’. There was much uncertainty interpreting these terms.

The examination of documents and sets out new standards. Needless to say that this area had been a major source of problem, specially between the beneficiary and the confirming/nominating bank. Attempts have been made to reduce the problems usually arising out of wrong interpretation.

UCP 500 Article 27

UCP 600 Article 23

Date of dispatch to taken as the date of shipment.

If actual date of shipment not specified, date of issuance of the bill will be accepted as the date of shipment.