Hong Kong is Hong Kong is Hong Kong is China …


Sometimes it is the difficult to predict what is controversial – and what is not. The new “bundle” of approved ICC Opinions (from the meeting in the ICC Banking Commission in Mexico) has been circulated – and three Opinions – compared to the Draft Opinions was missing. One was TA771, which was withdrawn before the meeting. One other was TA761, which was withdrawn at the meeting.

 

The one of my interest however: TA770 was held over until the next Banking Commission meeting that will take place in Spring 2013. Hmm as such the question was quite simple; one that should be able to be answered with a simple “Yes” or “No” ….

 

The scenario of TA770 was: An LC calls for a bill of lading showing shipment from “Any Chinese port.” The bill of lading presented indicates a dated on board notation on a named vessel from “Hong Kong Port.”

 

So the natural questions are: is this a discrepancy? Is Hong Kong a Chinese Port?

 

In fact I have been considering this question for quite some time – and frankly I am not able to provide any “correct” answer. Or rather: One can in fact argue both ways – and objectively reach the conclusion that one want to reach. This is exactly why it is extremely important to have an Official Opinion from the ICC Banking Commission on this issue. This must be “logged” into the “international standard banking practice” so that:

 

- banks can issue their LCs so that they achieve what they want to, and

- document examiners knows what is "right" and what is "wrong"

 

This will help avoid endless problems, discussions and discrepancies.

 

For that reason it is of course extremely disappointing that no answer was given in Mexico – and that we need to wait to – at least Spring 2013.

 

However – what came as a total surprise to me was that the question is in fact very controversial. To me the issue simply is to determine how this is viewed from an LC document examination point of view! Nothing more – nothing less.

 

However, what I have learned is that quite a number of people are quite emotional about this issue.

 

The next issue of the LCM Newsletter “Trade Services Update” will include abstracts from a – very long – discussion about this particular query.

 

And should I mention that the query was raised by ICC Denmark! And should I stress also, that raising this question was ONLY to clarify the issue – in order to help the document examiners when they are doing their daily work. So I will apologize if the question has offended anyone, but I will say also that I hope sincerely that a clear answer will come out of the ICC Banking Commission this spring. The answer is badly needed by the LC community. To me it is not important if the answer is “YES” or “NO” – what matters to me, is that the answer is clear and unambiguous.

 

Take care of each other – and the LC!

Kim    


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