UCPDC 600 ARTICLE 36-39
ARTICLE 36 : Force Majeure
A bank assumes no liability or responsibility for the consequences arising out of the interruption of its business by Acts of God, riots, civil commotions, insurrections, wars, acts of terrorism or by any strikes or lockouts or any other causes beyond its control.
A bank will not, upon resumption of its business, honour or negotiate under a credit that expired during such interruption of its business.
ARTICLE 37 : Disclaimer for Acts of an Instructed Party
a. A bank utilizing the services of another bank for the purpose of giving effect to the instructions of the applicant does so for the account and at the risk of the applicant. b. An issuing bank or advising bank assumes no liability or responsibility should the instructions it transmits to another bank not be carried out, even it has taken the initiative in the choice of that other bank. c. A bank instructing another bank to perform services is liable for any commissions, fees, costs or expenses (“charges”) incurred by the bank in connection with its instructions.
If a credit states that charges are for the account of the beneficiary and charges cannot be collected or deducted from proceeds, the issuing bank remains liable for payment of charges.
A credit or amendment should not stipulate that the advising to a beneficiary is conditional upon the receipt by the advising bank or second advising bank of its charges.
d. The applicant shall be bound by and liable to indemnity a bank against all obligations and responsibilities imposed by foreign laws and usages.
ARTICLE 38 :Transferable Credits
a. A bank is under no obligation to transfer a credit except to the extent and in the manner expressly consented to by that bank. b. For the purpose of the article:
Transferable credit means a credit that specifically states it is “transferable”. A transferable credit may be made available in whole or in part to another beneficiary (“second beneficiary”) at the request of the beneficiary (“first beneficiary”).
Transferring bank means a nominated bank that transfers the credit or, in a credit available with any bank, a bank that is specifically authorized by the issuing bank to transfer and that transfers the credit. An issuing bank may be a transferring bank.
Transferred credit means a credit that has been made available by the transferring bank to a second beneficiary.
c. Unless otherwise agreed at the time of transfer, all charges (such as commissions, fees, costs or expenses) incurred in respect of a transfer must be paid by the first beneficiary.
d. A credit may be transferred in part to more than one second beneficiary provided partial drawings or shipments are allowed.
A transferred credit cannot be transferred at the request of a second beneficiary to any subsequent beneficiary. The first beneficiary is not considered to be a subsequent beneficiary.
e. Any request for transfer must indicate if and under what condition s amendments may be advised to the second beneficiary. The transferred credit must clearly indicate those conditions.
f. If a credit is transferred to more than one second beneficiary, rejection of an amendment by one or more second beneficiary does not invalidate the acceptance by any other second beneficiary, with respect to which the transferred credit will be amended accordingly. For any second beneficiary that rejected the amendment, the transferred credit will remain unamended.
g. The transferred credit must accurately reflect the terms and conditions of the credit, including confirmation, if any, with exception of:
• the amount of the credit, • any unit price stated therein, • the expiry date, • the period for presentation, or • the latest shipment date or given period for shipment, any or all of which may be reduced or curtailed.
The percentage for which insurance cover must be effected may be increased to provide the amount of cover stipulated in the credit or these articles.
h. The first beneficiary has the right to substitute its own invoice and draft, if any, for those of a second beneficiary for an amount not in excess of that stipulated in the credit, and upon such substitution the first beneficiary can draw under the credit for the difference, if any, between its invoice and the invoice of a second beneficiary.
i. If the first beneficiary is to present its own invoice and draft, if any, but fails to do so on first demand , or in the invoices presented by the first beneficiary create discrepancies that did not exist in the presentation made by the second beneficiary and the first beneficiary fails to correct them on first demand, the transferring bank has the right present the documents as received from the second beneficiary to the issuing bank, without further responsibility to the first beneficiary.
j. The first beneficiary may, in the request for transfer, indicate that honour or negotiation is to be effected to a second beneficiary at the place to which the credit has been transferred, up to and including the expiry date of the credit. This is without prejudice to the right of the first beneficiary in accordance with sub article 38(h).
k. Presentation of documents by or on behalf of a second beneficiary must be made to the transferring bank.
ARTICLE 39 :Assignment of Proceeds
The fact that a credit is not stated to be transferable shall not affect the right of the beneficiary to assign any proceeds to which it may be or may become entitled under the credit, in accordance with the provisions of applicable law. This article relates only to the assignment of proceeds and not to the assignment of the right to perform under the credit.