Export Documentation: Original Documents for Letters of Credit

Documents presented for payment against a letter of credit must be originals unless the credit says that copies are acceptable. The ICC’s Uniform customs and practice for documentary credits 2007 revision ICC no. 600 article 17 defines what banks will accept as original documents and what as copies. Article 17b gives criteria for accepting a document as original. Article 17c says that unless stipulated otherwise a document will also be accepted as original if it appears to be written, typed, perforated or stamped by the issuer’s hand, or appears to be on the issuer’s original stationery, or states that it is original (unless that statement appears not to apply to the document presented). Article 17d allows acceptance of either originals or copies if the credit allows either, and article 17e applies this to multiple copies provided at least one document is original unless the credit specifies otherwise.

The point appears to be that unless a document is clearly original (meaning uniquely-produced and carrying whatever legal effect it has) because it is handwritten or appears to be an original typescript a bank must accept it as original only if it is marked as original, usually by means of an original rubber stamp. This point was crucial in a British court case settled in autumn 1995 and upheld by the Court of Appeal in 1996. In Bayerische Vereinbank and Glencore International AG v. Bank of China, the judge accepted the defendant bank’s refusal to accept a certificate which was produced from another by alteration and photocopying and hand-signed but was not marked ORIGINAL. The certificate was merely a declaration that specified documents had been sent to the beneficiary, and the bank had accepted similarly-produced certificates before, but this illustrates the care needed when preparing any documents for banks.

The question arises whether the requirement applies to negotiable bill of lading sets, which have traditionally been taken as multiple originals. The case was not directly concerned with them, but a remark by the judge implied that each sheet of a negotiable set might need to be stamped ORIGINAL for a bank. Although the question is unanswered, many banks now insist on such marking by the issuer.

This case sets a precedent in British law and may be expected to affect banks’ practice in many other jurisdictions.

This is an extract from Tate’s Export Guide, for more information in regards to exports or imports please visit our website (www.tatefreightforms.co.uk)  or call us on 01908 221162.

Topics: Documentation and Legislation & Regulation
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