UCP 600 ARTICLE 5: Documents v.

Goods, Services or Performance

Banks deal with documents and not with goods, services or performance to which the documents
may relate.

Several small changes have been made in this article. The title of the article has been changed from
“Documents v. Goods/Services/Performances” to “Documents v. Goods, Services or Performance” to
simplify the wording and to delete the use of a virgule (“/”) between words.

UCP 500 article 4 stated: “In Credit operations all parties concerned deal with documents … ”. The
Drafting Group discussed the previous wording and decided that, in fact, in documentary credit
operations all parties do not just deal with documents. The beneficiary of the documentary credit
actually deals with the goods (services or performance), and as a result it was incorrect in the UCP to
state that “all parties” do so. The article was changed to reflect the fact that banks deal with documents
and not with the goods, services and performance to which the documents may relate.

To simplify the style in this article, as in others, the use of virgules has been eliminated and substituted
simply by the use of “or performance.
Should a bank review documents such as Inspection certificates, certificates of analysis
etc. to ensure that there are no derogatory comments regarding the goods?

No. This is not the responsibility of a bank. Sub article 14 (a) emphasizes that banks examine
a presentation on the basis the documents alone as to whether or not they appear on their face
to constitute a complying presentation. If the applicant requires that documents does not
contain any adverse comments or that documents should bear specific statements as to the
quality or standard of the goods, this must form part of the terms and conditions of the credit.

Medical drugs were imported from a Country C under a credit. All documents were
according to the credit terms and conditions. The goods reached the port of discharge.
On verification by the customs authority, it is found that the drugs are not as per the
required standard and the customs authority refused to release them to the importer.
Documents have already been released against acceptance. Is there any solution?

There is no solution under UCP 600. The documents complied with the credit and therefore
the issuing bank is bound to honor on the due date. The issues relating to the quality of the
goods must be resolved between the buyer and seller outside the terms of the credit.