UCP 600 Article 4 — Complete Interpretation Guide

Introduction

UCP 600 Article 4 (Credits v. Contracts) is lettered 4(a), 4(b). Banks compile a presentation against those limbs on the face of the documents. First limb: A credit by its nature is a separate transaction from the sale or other contract on which it may be based. Banks are in no way concerned with or bound by such contract, even if any reference whatsoever to it is included

Failure Mode Analysis

Failure mode 1: Skipping the first limb

Operations compile against later limbs and never test 4(a). The first limb is not optional. A presentation that violates it is a binary reject.

Applying the article

Read the limbs above as they stand in the ICC text. Do not import sub-articles from another article. Document examination remains UCP 600 Article 14: on the face of the documents, within five banking days following the day of presentation.

Conclusion

Use the article as printed. If a lettered sub-article is not in the text above, it is not part of the rule.

FAQ

What is Article 4(a)?

A credit by its nature is a separate transaction from the sale or other contract on which it may be based. Banks are in no way concerned with or bound by such contract, even if any reference whatsoever to it is included in the credit. Consequently, the undertaking of a bank to honour, to negotiate or to fulfil any other obligation under the credit is not subject to claims or defences by the applicant resulting from its relationships with the issuing bank or the beneficiary. A beneficiary can in

Are letters beyond b part of Article 4?

No. The ICC text letters Article 4 as (a), (b) only.

Does a five-day waiver request extend examination?

No. Article 16(b) states that approaching the applicant for a waiver does not extend the period in Article 14(b).