MUSCAT -- There is an immediate need for the exporting community to understand the revised Uniform Customs & Practices (UCP 600) for documentary letters of credits, which has become applicable from July 1, 2007 worldwide, Mukhatar Hasan, Chairman, Export Development Working Group of OCIPED said in a seminar held yesterday.
Addressing the session organised by OCIPED in association with Bank Sohar SAOG at the Oman Chamber of Commerce & Industry, Mukhatar Hassan added that UCP 600 contained important new provisions relating to transport and insurance, and such provisions would influence the terms of letters of credit in the years to come. According to him, around 15 per cent of international trade transactions are based on letters of credit and in value terms these transactions were worth over a trillion dollars.
Mukhatar Hasan made these observations while addressing over 150 exporters, importers, bankers, and representatives of insurance companies and freight forwarders, who attended the session. He said understanding of the revisions that have taken place in the UCP 600 was very important from an exporter's perspective since its non-compliance could lead to substantial losses not only to exporters but to the nation as well.
Commenting on the changes made under UCP 600, Shantanu Ghosh, DGM of Bank Sohar, observed that the inclusion of definitions of jargons, articles on interpretation and balance between literal compliance and substantial compliance, and so on, would lend more transparency to the terms of letters of credit and thus secure the interest of users.
Prof Harkirat Singh of Indian Institute of Foreign Trade (IIFT) while speaking on the subject clarified that the prime objective of UCP 600 was to make the transactions simpler and more user friendly. According to him, the compliance of UCP 600 will lead to fewer rejections when the documents are presented to the banks. The expert also informed that new UCP 600 had 39 articles as compared to 49 in UCP 500 and was more clear and easy to understand. Faris al Farsi, Acting Director-General of Export Development of OCIPED, thanked Bank Sohar, the Indian Institute of Foreign Trade, and all the participants for making the seminar a success.
By Staff Reporter
© Oman Daily Observer 2007
