Lloyd's Maritime and Commercial Law Quarterly
THE UNIFORM CUSTOMS—THEIR NATURE AND THE 1983 REVISION
E. P. Ellinger.*
I. THE DEVELOPMENT OF THE UNIFORM CUSTOMS
A. The Search for Uniformity (1927–1962)
On 1st October 1984 the 4th Revision of the Uniform Customs and Practice for Documentary Credits, promulgated by the International Chamber of Commerce (I.C.C.) in consultation with UNCITRAL (the United Nations Commission on International trade Law) replaced the 1974 Revision1. This older version, which has been adopted by the banking organizations of, or by individual banks in, some 170 countries, has, without a shred of doubt, become the cornerstone of the law pertaining to letters of credit. It is expected that the new version will solve some of the remaining, current, problems and that it will encourage further harmonization of the system.
It can be safely asserted that a greater degree of uniformity has been attained in respect of documentary credits than in the case of any other commercial facility2. Three factors have contributed to this development. First, documentary credits figure predominantly in international trade transactions. The parties to such a transaction reside in different countries. Harmonization of the law of letters of credit was accordingly required to avoid misunderstandings and confusion. Secondly, at least two parties to a letter of credit transaction are invariably international banks. Naturally, these work with each other not solely in the case of an isolated letter of credit but on a regular basis. Unification was, thus, required to maintain the efficacy of the international network involved. Thirdly, it will be shown that in documentary credit transactions all parties have to function with reasonable promptness. Without a clear understanding of a system such a course of dealings would have been impossible3.
In view of these characteristics of documentary credits, it is not surprising to see that the drive for uniformity commenced at an early stage. Pioneering efforts were undertaken on a national basis. Thus, in 1920 the New American Commercial Credits Conference, convened in New York, promulgated a set of regulations to be used by the banks in the United States. The banks in Berlin made a similar attempt for Germany in 1923. These were followed by initiatives taken in France and in Norway in 1925; in Czechoslovakia, Italy and Sweden in 1925; in the Argentine in 1926; in Denmark in 1928; and in the Netherlands in 19304.
* Sir John Barry Professor of Law, Monash University.
1 The new Revision is Brochure No. 400 of the I.C.C. For a comparison with the 1974 Revision, see Documentary Credits: UCP 1974/1983 Revisions Compared and Explained, I.C.C. Brohure No. 411, and the Appendix to this article.
2 Kozolchyk, “Letters of Credit”, International Encyclopaedia of Comparative Law (Hamburg 1979), Vol. IX, Chap. 5; Wheble, in Current Problems of International Trade Financing (Singapore, 1983), 75; Ellinger, in Transnational Law of International Commercial Transactions (cd. by Horne and Schmitthoff) (Kluwer, 1982), pp. 251 et seq. And see Liesecke, Wertpapier Mitteilungen [abbreviated as “WM”] (1976), 258.
3 Cf. Eberth, in Current Problems of International Trade Financing, op. cit. (supra, fn. 2), 21 et seq.; Liesecke, loc. cit., (supra, fn. 2).
4 Ellinger, Documentary Letters of Credit—A Comparative Study (Singapore, 1970), 37; Stoufflet, Le Crédit Documentaire (Paris, 1957), 101; Eiseman and Eberth, Das Dokumentenakkreditiv im Internationalen Handelsverkehr (Frankfurt, 1979), 42.
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