Newsletter containing International Trade related articles and events. Signup at http://www.ebsi.ie
ISSUE 1 200
X ICC BANKING COMMISSION
MEETING IN ATHENS.................... 1
X DIPLOMA IN EXPORT OPERATIONS
LAUNCHES .................................. 2
X DOC. CREDIT CLINIC ............... 4
X IFC FIT INITIATIVE?????..5
X WEBLINKS FOR TRADE............. 8
X TRADE PRACTICE CLINIC ......... 9
X COUNTRY FOCUS - MONGOLIA . 10
X EXPERT COMMENTARY ? KIM
CHRISTENSEN ............................. 13
X CAREER FOCUS ...................... 14
X RECENT EVENTS..................... 16
X CHINA SYSTEMS TUTORIAL ...... 20
X EXPERT COMMENTARY ? PRADEEP
X UPCOMING EVENTS................. 23
ICC Banking Commission Meeting in
Athens takes innovative approach!
The most Clear support was shown for this recent meeting of the
driven by demands in the
ICC Banking Commission took
international commercial market.
place in Athens on Tuesday 15
and Wednesday 16 April 2008.
The second day of this important
event was dedicated to panel
The first day of the meeting was
discussions on critical issues facing
dedicated to the core tasks of the
the trade finance markets.
ICC Banking Commission.
The panels included:
Following the welcoming remarks
1. the global credit crunch.
from Ms. Regina Prehofer, Banking 2. innovations in the supply
Commission Chair and Mr. Guy
3. standardization in electronic
Sebban, the ICC Secretary General
the work of the commission got
4. regional market focus
The regional market focus panel was
ICC Opinions and DOCDEX
chaired by Vincent O?Brien, First
Mr. Gary Collyer, the Technical
Director of eBSI. This panel included
Advisor to the Banking Commission
discussions on developments in
lead the discussion on ICC Official
Central and Eastern Europe, Latin
Opinions as well as recent DOCDEX America and the Middle East.
The next meeting of the ICC Banking
Commission will take place in Paris on
A highlight of the first day was the
Thursday 23 and Friday 24 October
presentation by Dr. Georges Affaki
providing the commission members
with an update on the progress of
The next meeting in Paris will be held
the revision of the Uniform Rules
in association with the International
for Demand Guarantees (URDG)
Finance Corporation (IFC).
Avoiding Fraud in Operational Risk
The latest innovation to provide security in international banking operations is
the use of Iris Recognition Technology to facilitate the speedy access of pre-
authorized personnel to systems, processes and data in a secured environment.
Vincent O?Brien acts as a senior consultant to the World leader in this
innovative technology, Iris Guard Inc and he introduced the application of this
technology to an audience of senior bankers at the Letter of Credit Annual
Survey of Law and Practice held in Hong Kong and Singapore during July 2008.
Iris Eyes are Smiling?
The presentation can be viewed at:
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 1
News & Commentary
Our first issue is a bumper one
with lots of articles and news
about International Trade,
Finance and Logistics, as well
as some information on
developments by eBSI this
year. As you will eBSI has
Launch of Diploma in Export Operations at IITI Headquarters Dublin
extended its global reach and
L-R: John Whelan CEO Irish Exporters Association, Minister of European Affairs Dick Roche,
have been active in more
Thomas Smith operation Director of EBSI, and Mohamed Hafez Manager of the IITI
countries than ever before.
With the credit crunch
E-learning Diploma in Export Operations
impacting the financial
Launched in Ireland by eBSI and IITI
markets banks and trading
companies are once again
While undertaking the Diploma in
turning to traditional trade
Export Operations participants will
finance instruments to
The Institute of International
be involved in structured guided
underpin security in
Trade of Ireland and eBSI have
learning. Participants will be guided
been working on the development of
by expert tutors through the
an e-learning extension to the
technical knowledge and skills
The net result has been
International Trade Specialist
essential to practitioners
positive for eBSI with our
Accreditation Programme for over 2 participating in international trade.
international trade and finance
years now and we are delighted to
The Diploma is based on 4 learning
consultants in more demand
inform you of its formal launch from
modules geared towards
than ever before.
the strategic and more
The long awaited
Gain advanced elements of ing a qualification in
The Diploma in Export
international trade and related
subjects is now seen as a
passport to managers: international job
with a valuable inclusive
? Supply Chain
security and mobility.
? Export Marketing
The Diploma in Export
I would like to extend my
? Law of International
heartiest congratula Operations has four tions to
the graduates of our first essential objectives:
? Global Trade Study
Certificate in Finance of
1) Acknowledgement of
On completion of the Diploma in
International Trade under the
competence in individuals operating
Export Operations, successful
?FIT Initiative? which was
within the international trade and
candidates will be eligible for
supported by the IFC in
logistics environment. ongoing membership of the Institute
Bangladesh and Pakistan.
of International Trade of Ireland.
2) Consolidation of knowledge and
expertise of participants to an
We hope you will enjoy the
For further details about this new
advanced Diploma level.
new format and feel free to
innovative e-Learning Diploma
3) Enhancement and sharing of
send us suggestions!
contact either Thomas Smith of eBSI
knowledge and expertise of
(email@example.com) or Mohamed Hafez of
Yours, international trade practitioners
the Institute of International Trade
undertaking the Diploma.
4) Testing, assessment and formal
accreditation and certification of
practitioners undertaking the
Enrolments will take place on 21
Diploma in Export Operations.
September and 17 November 2008.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 2
News & Commentary
Irish Owned Burke Shipping Group establishes
First European All China Inland Network
Mr. Ciaran McCann, joined the Burke Shipping Group Ireland, in 2000,
as a freight and passenger manager at Terminal 2 in Dublin Port. Over
the next number of years, Ciaran moved into Group Project
Management and finally onto today?s position of Director at BSG
Shanghai. Prior to the establishment of the company in China, Ciaran
completed the Trade and Customs Practice Course offered by EBSI.
?The Trade and Customs Practice Course was extremely valuable for me
in getting over overall perspective on the industry, consolidating my
professional experience within the group and adding an in-depth
international dimension to my knowledge base?
L-R: Alan Dai, GM and
? One example of this would be the Incoterms 2000 Module, as working
Ciaran McCann, MD of BSG Shanghai
on the front line of export operations from China, familiarity with
Incoterms is a necessity. This coupled with other units such as
documentation in international trade and customs procedures has in essence paved the way for a smooth transition from
Ireland to China. I would highly recommend this course for anyone working in or wishing to work in International Trade.
Burke Shipping Group Shanghai Ltd, is a Class A Freight Forwarding Company with a NVOCC License awarded by the Chinese
Ministry of Communications. Building on previous years experience of exporting from China to Ireland through agents, a
decision was made in June 2007 to establish the company. Ciaran McCann began conducting interviews whilst on business
travel in China, and eventually in 2007 moved to Shanghai.
?The opening of our company has enabled us to provide our customers with a greatly increased level of service, and this can
be reflected through the volume of trade we have facilitated since BSG commenced in China. It has also afforded us the
opportunity to look at other markets outside of the EU. We have developed an all China inland network, and are also
developing further networks in South east Asia, on top of our Sino Irish, US and EU trade. It is a very exciting time to be
here, and despite all the talk of global slowdown and recession in Europe, a dynamic approach to business will always prove to
seek out new markets and develop relationships.? Ciaran plans to stay in China for the foreseeable future.
You can contact Ciaran firstname.lastname@example.org, or visit their company website www.bsg-shanghai.com.cn.
eBSI Now Offers Certified
International Trade Skillnet
Launched by Chambers Ireland
eBSI is delighted to announce that we have entered into
an agreement with Coracle Online to begin providing
online courses in preparation for the examinations for the
Institute of Chartered Shipbrokers (ICS) leading to the
The International Trade Skillnet will operate for the period
January 2008 ? December 2009. Training will be aimed * Background to Shipping
at sensitising Irish companies to the implications of * Foundation Diploma
regulatory changes in the field of international trade and * Advanced Diploma
to make sure that these changes will result in * ICS Membership exams ? PQE
considerable gains in competitiveness to all member
Courses we can offer online now include:
participants. Single Window, Authorised Economic
* Background to Shipping
Operator, and pre-arrival pre departure will be important
* Dry Cargo Chartering
elements of the training modules. Ireland has around
* Economics of Sea Transport and International Trade
15,000 companies involved in import or export, with four
* Emissions Trading
importers to every one exporter ? the majority of these
* Introduction To Shipping
companies need to be educated and prepared for all of
* Legal Principles in Shipping
these new changes. We believe that this Skillnet will
* Liner Trades
address the current training vacuum in these important
* Logistics and Multi Modal Transport
* Marine Insurance
This Skillnet will offer a host of activities which will be * Port Agency
enterprise-led and funded by member companies and the * Port and Terminal Management
Training Networks Programme, an initiative of Skillnets * Ship Operations and Management
Ltd, funded from the National Training Fund through the * Ship Sale and Purchase
Department of Enterprise, Trade and Employment. * Shipping Business
* Shipping Law
For further information, please visit the skillnet website at * Tanker Chartering
Participants can study at their own pace and take the
Members of this skillnet can get up to 50% funding courses alone or as preparation for the ICS Exams. To
towards the cost of some eBSI courses. Contact Mary enrol or for further details on these courses please email
Meehan email@example.com for more info! John Farrell at firstname.lastname@example.org.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 3
eBSI Doc. Credit Clinic
Vincent O?Brien tackles some queries on UCP 600
Q. 2008/00x ? ?'military action ?force majeure ??
As a beneficiary
LCs it is our
Name: Vincent O?Brien
company policy to
Position: First Director
on all LCs issued by Location: Kiltimagh, Ireland
Specialisation: International Trade Finance
banks in certain
Approximately five months ago we made a presentation to a
confirming bank under a credit available by deferred payment
at 180 days from bill of lading date.
The presentation was made within the presentation period and
the expiry date at the counters of the confirming bank where
the LC was available.
The documents were processed by the confirming bank
without any communication to ourselves regarding
discrepancies or otherwise.
However, it has transpired that due to military driven unrest it
has been impossible to unload the goods at the port of
discharge stated in the LC and furthermore the issuing bank
has been closed for some weeks.
We have been advised by the Confirming Bank that payment may be delayed due to a ?Force Majeure Event? at port and
country of destination.
We argued that this is not correct as they had earlier added their confirmation to the LC.
The confirming bank replied stating that they have no liability as this situation is a ?force majeure event? quoting UCP 600
Article 36 ?A bank assumes no liability or responsibility for the consequences arising out of the interruption of its
business by Acts of God, riots, civil commotions, insurrections, wars, acts of terrorism, or by any strikes or lockouts or any
other causes beyond its control?
Please clarify, as this appears to us to be bending the rules.
Yes, this is certainly ??a bend too far!?
Let us take this step by step.
First, once the confirming bank added its confirmation then per UCP 600, article 2 it has given you a ?definite
undertaking? to ?honour a complying presentation? of documents..
Second, as the confirming bank did not issue a notice of refusal by the close of the fifth banking day following the day of
presentation, the confirming bank is now clearly precluded from claiming that the documents do not constitute a
complying presentation ? and must honour.
Third, the unfortunate events you mention in your query did not interrupt or have an effect on the business of the
confirming bank whose undertaking is additional and separate to that of the issuing bank.
Bluntly put, the confirming bank is quoting Article 36 out of context and must honour, which means the confirming bank
has an obligation to effect payment to you as beneficiary on the maturity date.
If you have a query on documentary credits or UCP 600 why not contact Vincent at email@example.com!
This Article was originally printed in LC Monitor, a leading Documentary Credit Publication. www.lcmonitor.com/
Certified Training Programmes
Programme Intakes every two months from September & November 2008
? Certificate in Logistics
? Certificate in Finance
? International Trade Specialist
Delivered exclusively by:
The electronic Business School International
? Diploma in Export Operations
Tel: +353 94 9381444 Fax: +353 94 9381708
? Certified Courses in Shipping
Web: http://www.ebsi.ie Email: firstname.lastname@example.org
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 4
eBSI eBSI Projects
International Finance Corporation leads way
in e-Learning for Trade Finance Practitioners
Dhaka & Chittagong, Bangladesh, Karachi & Lahore, Pakistan
The first national roll-outs of the 'FIT' Initiative were launched on 5 March 2008 in Dhaka in Bangladesh and on
30 April in Karachi, Pakistan. This initiative is based on the introduction of a specialised Finance of International
Trade (FIT) certificate program designed to encompass the core operational areas of International Trade Finance
and Payments. This innovative initiative from IFC will be delivered by a team of leading organisations from
around the world in order to ensure the highest standards of content, support and accreditation are offered to
This international group is led by the electronic Business School International (eBSI), a leading International
Trade and Finance Training organisation specialising in the delivery of eLearning programs in these important
areas. eBSI has partnered with IFC to deliver the FIT Initiative in IFC's Priority Countries with IFC support and
through eBSI's own Emerging Markets Grant Scheme (EMGS).
The FIT Initiative is certified by the Institute of Export UK and successful participants who pass the FIT Program's
continuous assessment elements will receive a certificate in Finance of International Trade from the Institute of
Export UK. Course content also includes ICC approved online training in UCP 600 provided by Coastline Solutions
The IFC 'FIT Initiative' is an essential component in the training make up of all trade finance practitioners given
its practical online approach to a broad spectrum of core trade finance products including Documentary
Collections, Documentary Credits, Factoring, Forfaiting, Invoice Discounting, Bonds and Guarantees, all delivered
in a comfortable and permanent Global Trade Finance Campus online.
The Dhaka event included representatives from IFC, eBSI and ICC Bangladesh among over 80 other mainly trade
and banking related delegates. There was significant press coverage at the event and positive feedback on the
relevance and need for such a Finance of International Trade qualification has already been received.
Promotional Seminar in Dhaka, participants meet
ICC Bangladesh President Mr. Mahbubur Rahman
Promotional Seminar in Chittagong
3 March 2008
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 5
eBSI eBSI Projects
A series of seminars were held in Karachi and Lahore in conjunction with the Institute of Bankers, Pakistan to
mark the launch of the IFC FIT Initiative in Pakistan. The Karachi event took place on 30 April and had over
At the launch in Lahore, Mr Nadeem Siddiqui, Country Head for IFC in Pakistan explained ?The ?FIT Initiative? in
Pakistan has been implemented with the support of the ?IFC Global Trade Finance Program? which itself, in a
short period of time has proven to be a highly successful global trade finance support program for banks and
their customers in emerging markets, including Pakistan?. Notwithstanding the continued importance of Letters
of Credit in financing such trade into and out of Pakistan, it has been identified that there is a need to apply
other methods of payment and more advanced trade finance products to further accelerate the development of
exports from Pakistan. Further details about this IFC Training Program can be found at
The ?FIT Initiative? is an e-learning program Online Collaboration Site for stakeholders
that is designed with an important dual
To leverage the network aspect of the 'FIT'
Initiative all stakeholders (participants, tutors
1. to train and certify international trade
and coordinators) will have access to an online
networking and collaboration system designed to
2. to build an online global network of
facilitate exchange of ideas and contact building.
international trade and finance professionals
who will share knowledge and experience on
CD ROM Based Core Learning Material
an online platform specifically developed for
The Finance of International Trade (FIT) is
comprised of the following Learning Units:
* Methods of Payment
This Three Month program is delivered in a
* Bills of Exchange
combination of the following learning
* Documentary Collections
* Documentary Credits
* Import Documentary Credits
Online Support site for students
* Bonds & Guarantees
Students will be incorporated into the eBSI
* Forfaiting, Factoring & Invoice Discounting
Alumni and will be able to collaborate through
* Structured Trade Finance
a purpose built learning platform.
* Export Credit Agencies
Pa * Complex Transactions rticipants at Promotional Seminar
Online Specialised training in UCP 600
* Warehouse Financing
in Karachi, 30 April 2008
ICC Approved Online Training in UCP 600
* IFC Global Trade Facilitation Program
(Mentor or Upskill 600).
Mr. Vincent O?Brien with participants at promotional event organized by Institute of Bankers in Pakistan in Lahore on 2 May 2008.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 6
eBSI eBSI Projects
Mr. Vincent O?Brien presents the FIT Mr. Vincent O?Brien takes the Chittagong event
Initiative at promotional event in Dhaka attendees through the benefits of the FIT Program
In FIT Participants receive their eLearning materials in Dhaka itiation Seminar for FIT Participants, Dhaka
Next Intake Dates for the IFC FIT Initiative
The next program intakes will take place in the following countries in
Bangladesh, contact Ataur Rahman, Bangladesh@ifcfitinitiative.net
Pakistan, contact Umar Farooq, Pakistan@ifcfitinitiative.net
For other countries please contact email@example.com
Project Partners in the IFC FIT Initiative
eBSI Gratefully acknowledges the participation and contribution provided to
The panel of speakers at the Karachi FIT Initiative Launch
the success of this project by the following project participants:
Vincent O?Brien with Nadeem Siddiqui, Country
Head for IFC Pakistan with participants
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 7
eBSI Weblinks for Exporters
eBSI Weblinks for Exporters is a new section that will provide every issue with websites recommended
by our course participants as being of particular use to them in their international Trade Activities!
Websites that can be considered for inclusion in this section include but are not limited to International
Trade, Trade Finance and Logistics sites such as:
? Business Networking Sites
? References or Blogs
If you have a site to recommend then send it
? Import Export Directories
to Weblinks for Exporters at firstname.lastname@example.org!
? Country Portals
Shippingpodcasts.com is a website providing just what the
domain name says: Online Podcasts covering various
aspects of Shipp world's ing, Shipping Law, recrui SITPRO is widely recognised as the tment, currencies,
leading trade facilitation body. Its focus is the
Clean Products and more! All provided by our friends at
procedures and documentation associated with
international trade. Great Guides!
The goal of World Port Source is to
be the premier Internet website of
The Organization of Women in International Trade (OWIT), is a
publicly accessible seaport
non-profit professional organization designed to promote women
doing business in international trade by providing networking
A treasure trove of Shipping info!
and educational opportunities. Their Mission is to unite women
Nice Daily ?Name the Seaport?
around the globe to foster international trade and the
advancement of women in business.
Need a basic translation of a web page? Or Just a
One of the most Informative websites I have found
phrase from an email has you stuck? translate it
on China! It has Blogs, Questions and Answers,
News, tips and lots more! Excellent!
Xing, formerly OpenBC recently
Tradeprofessional.net is a Business
Ecademy is a Business bought Neurona making it one
Networking Site dedicated only to
Networking Site based in UK of the biggest European based
International Traders and includes a trade
with Large UK and US Business Networking Sites.
Jobsite, Blogs, Forums, Events, groups and
membership, good Remarkably high quality
online Marketplace. Highly Recommended!
communications tools. contacts can be made here.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 8
eBSI Trade Practice Clinic
Following on from our complete redesign of eBSI Tradebrief we have also given
our Trade Practice Clinic a new look and feel. The process remains the same
though, simply email us at email@example.com to have your question considered
for the next issue! Our queries this issue come from Taiwan and Bangladesh!
Taipei, Taiwan Dhaka, Bangladesh
Q : We have recently begun exporting from Taiwan and Q : We are exporting into the Russian market and am
have been asked to arrange shipment of a container of glad to say business is growing. We are currently
goods from Keelung to Sydney. As part of the conditions shipping to Moscow on a monthly basis.
of the sales contract our buyer in Australia have specified
that our goods should not be transhipped nor Stowed on Our problem relates to Incoterms 2000, specifically CIP
Deck. Can you explain why this is so as I feel it is a Moscow. Having received payment by SWIFT transfer,
rather unreasonable requirement? we shipped goods to Moscow. To obtain clearance of the
goods our customer had to pay a duty surcharge. Our
customer maintains that it is not their obligation to pay
A : Lets take a look at each of these issues one at a
this duty surcharge, but that of the exporter.
time. First of all, lets get our definitions correct:
Transhipment means to transfer from one ship or
We would appreciate if you could clarify who is
conveyance to another for further transit.
responsible for paying the duty surcharge under the
Incoterm CIP Moscow (Incoterms 2000)?
Deck Stowage means to stow or place cargo on board
the ship on its deck rather than under its deck in a cargo
A : Under CIP Moscow (Incoterms 2000), the seller
Both of these practi + Organise and pay for transport to named place Moscow. ces are less than ideal because of the
+ Organise Insurance with risk transferring at first carrier.
additional risks they bring into the transportation of the
+ Pay costs including insurance cost to named place Moscow
goods. In the case of transhipment there is the
additional risks inherent to unloading and reloading the
goods from one method of conveyance to another.
Added to this are the risks attributable to holding the
goods in a ports cargo yard between shipments such as
the effects of weather, pilferage, accidental damage and
Remember, the risk and responsibility transfers from
In the case of Deck Stowage, the most obvious problems
the seller to the buyer when the goods have been
associated with this are exposure to the elements during
received by the first carrier, which in this case occurred
the voyage and the risk of having the goods washed
at the point of departure.
overboard in stormy weather! There is also a very real
risk that in the event of an emergency where cargo must
However, the key point and the answer you need is that
be jettisoned to save the ship that your cargo stowed on
import duties and all clearance formalities are a cost to
deck will be the first to go!.
be borne by the importer, your customer. You are right
to disagree, under CIP Moscow the importer is
Sometimes though, Deck Stowage will be unavoidable as
responsible for the payment of any duty surcharges.
your cargo may be too bulky or could pose a risk to the
safety of the ship if stowed below deck.
If you wished to take on the responsibility of paying the
import duties and taxes for further shipments then the
I notice from the details of your query that your cargo will
appropriate incoterm to quote is DDP Moscow. However,
be shipped in containers. In this case you need not worry
if you decide to use DDP Moscow you must remember to
as stowing containers on deck is common and does not
factor the extra costs into the price quoted on the pro-
count as Deck Stowage because the container is
forma invoice. It must also be borne in mind that you
considered for all intents and purposes to be part of the
will be exposed to any fluctuations in the rates of duty
levied at Moscow and for that matter any duty
surcharges that may arise.
Incoterms 2000 is an official publication of
the International Chamber of Commerce
and is currently under revision by the ICC.
Customs & Foreign Trade Specialist
Trade & Finance Specialist
DISCLAIMER: Articles within this publication contain information, which is for guidance on matters of general interest only. There may be omissions or
inaccuracies in information contained in this publication and the information is given on the understanding that it should not represent a substitute for
professional consultation. Although we have made every effort to ensure the information in this publication is reliable, the electronic Business School
International, GTI Learning.com and the Authors of these articles accept no responsibility for errors, omissions or adverse results obtained from using the
information. The electronic Business School International, GTI Learning.com and the Authors of these articles issue no guarantee of completeness, accuracy,
timeliness or results obtained from using the information. The electronic Business School International, GTI Learning.com and the Authors of these articles will
therefore not be liable to you or anyone else for decisions made or actions taken in reliance on the information in this publication.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 9
Country Focus - Mongolia
eBSI has been very active this year in Mongolia and in this issue we
have decided to do our first Country Focus feature on this vast yet
under-populated country, rich in mineral resources and bursting with
opportunity for those willing to venture! The country has become the
focus of a number of international development organisations and
programmes including the EBRD Trade Facilitation Programme which
is supporting trade finance in the emerging corporate banking sector
in Mongolia. The beneficiary banks are Khan Bank, Xac Bank, Trade
and Development Bank of Mongolia and Zoos Bank.
EBRD Trade Finance Advisory services have provided a fast track
option for banks in emerging markets to develop trade finance and
undertake trade deals. This important Mongolian project is supported
by the EBRD Mongolia Cooperation Fund. The Trade Advisory services
provide hands on assistance in trade product development,
operational procedures, training in trade finance risk management
and guidance on structuring more complex transactions.
For example, Khanbank is emerging as a leading and highly rated
corporate bank in Mongolia and is seeing the benefit of the EBRD
Trade Advisory Project. Barry Maddams, Deputy CEO of Khan Bank
said ?the practical approach of the EBRD trade advisor is paying
dividends in terms of new trade finance business being transacted
which will in turn help us maximise the benefits of the EBRD Trade
The EBRD trade advisory services are being delivered by Vincent
O?Brien from Ireland who has delivered training or technical
assistance in all the EBRD countries of operation. According to
O?Brien ?banks such as KhanBank are well positioned to undertake
trade finance - Mongolia?s trade balance is going the right way and
with the increasing value of Mongolian natural resource commodities,
the picture looks bright for this expansive country with it?s small but
highly literate and well educated young population?
Since Pictures speak a thousand words we have compiled a photo
Trade Finance Workshop for Khanbank
summary of some of the events eBSI has been involved in this
delivered in Ulaanbaatar, Mongolia under the
exciting emerging market! EBRD Trade Finance Advisory Project by
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 10
Country Focus - Mongolia
In 1991, Mongolia started a rapid transition from central planning to a market-
oriented economy. The collapse of the USSR and the socialist trading system
threw the Mongolian economy into great difficulties, resulting in a sharp
Basic Economic Facts
depression and increasing poverty in the first half of the 1990s. At the same time,
GDP: US$3.2bn (2006) US$3.9bn (2007 est)
progress was made in establishing the foundations for a market economy.
GDP per head: US$1,216 (2006), US$1,486
Reforms included price and trade liberalisation, the reduction of lending to state
owned enterprises, the creation of a commercial banking system and a massive
Annual Growth: 7.5% (2006); 9.9%
programme of privatisation which saw the proportion of the economy in private
hands rise from 4% to over 70% between 1990 and 2000.
Inflation: 9% (2007)
Major Industries: Mining, cashmere,
The transition to democracy and a market economy continues to be difficult, but
Mongolia remains committed to the process and retains donor confidence.
Major trading partners: China, Russia,
Progress is clearly being made and this is driven by expectations from the
United States, Japan
emerging mining sector based on the abundant natural resources in Mongolia.
Exchange rate: (in Togrogs).
EBRD in Mongolia
US dollar USD 1149.19
Euro EUR 1642.77
The EBRD completed its first full year of operations in Mongolia in 2007. During
Japanese yen JPY 10.55
the year, the EBRD signed six projects, all in the private sector.
British pound GBP 2042.23
Russian rouble RUB 45.33
In future, the EBRD?s pipeline of potential projects in the country include
Chinese yuan CNY 167.95
transactions in mining and related services, agribusiness, property, textiles,
telecommunications, renewable energy, downstream petroleum, as well as in the
EBRD Trade Advisory Project for Mongolia
For any emerging economy rich in natural
resources the ability to develop an international
trading structure is of paramount importance.
Central to the development of Mongolia?s trade
potential is a development of international trade
finance services to international standards.
The EBRD Trade Advisory Project provided direct
technical assistance to four banks in Mongolia:
? Trade and Development Bank
Each Bank involved in this project went through
four key stages:
1. Initiation and Evaluation Phase
2. Knowledge Transfer Phase
3. Technical Implementation Phase
UCP 600 Seminar Mongolian Chamber of Commerce& Industry with project
4. Evaluation and Review
beneficiaries Trade Development Bank of Mongolia, Xacbank, Zoos Bank,
Khan Bank and Bank of Mongolia in attendance.
The Initiation and Evaluation Phase involved the consultant in
evaluation the current status and needs of each bank and developing a
tight work-plan to achieve the deliverables agreed.
The Knowledge Transfer Phase involved the training of selected staff
within each bank in the operations and management of international trade
This second phase was followed by the Technical Implementation
Phase which focused on the development and implementation of best
practices in international banking practices based on international rules
of operation such the UCP 600 introduced globally by the International
Chamber of Commerce on 1 July 2007.
Product Knowledge Workshop ? Xacbank
This phase also involved development of standard forms and templates to
facilitate the smooth operation of international trade finance products
within the emerging international trade banking sector in Mongolia.
The Evaluation and Review Phase examined the impact and derived
benefits from the EBRD Trade Advisory Project.
The primary evidence of success in any trade advisory project is the
demonstration of the development and increased transacting of
international trade finance transactions using international trade finance
instruments such as letters of credit and guarantees.
In all four cases the benefits of the EBRD Trade Advisory Project have
been clearly demonstrated.
The consultant delivering this project for EBRD was Mr.Vincent O?Brien,
First Director of eBSI.
Zoos Bank Product Knowledge Workshop
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 11
eBSI Country Focus - Mongolia
Mr. Barry Maddams, Deputy CEO welcomes customers to launch of KhanBank ITS
Useful Websites on Mongolia
Useful Websites on Mongolia
Ministry of Industry and Trade
Bank of Mongolia
Foreign Investment and Foreign Trade Agency
Trade Development Bank of Mongolia
Doing Business in Mongolia
Mongolian National Chamber of Commerce & Industry
Government of Mongolia
Mongol Business Institute
Mongolian Stock Exchange
Mongolian Business Guide
Mongolian Development Gateway
News about Mongolia
Daily Business News on Mongolia
Xasbank/ Tuushin Workshop for Corporate Customers
Zoos Bank Trade Finance Presentation to Board of Directors and Chairman
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 12
eBSI Expert Commentary
Is the LC Available?
There are a number of letter of credit issues that by the users (importers and
exporters) are considered ?banking issues? ? i.e. of no real relevance for them. One of
those issues is ?availability? i.e. where and up till when the letter of credit is available.
This is an issue often discussed within the banking community ? and following those
discussions one may in fact get the impression that this is only a banking Issue. These
discussions will normally circle around the question on whether or not the nominated or
advising bank is ?protected? by the letter of credit rules ? i.e. if the bank issuing the
letter of credit has an independent obligation to pay or reimburse the advising or
Name: Kim Christensen
In these discussions there is however one element often forgotten ? and that is the
Position: TF Business & Product Specialist
position of the exporter; the beneficiary to the letter of credit. What the exporter is
Employer: Nordea Trade Finance
normally being told is that it is important that the documents are made in a way so
Location: Copenhagen, Denmark
that they comply with the terms and conditions of the letter of credit. There is however
Specialisation: International Trade Finance
another element ? equally important ? and that is where and when to present the
documents ? in order to trigger the obligation of the issuing bank ? and the confirming
bank ? if the credit is confirmed.
The letter of credit rules (UCP 600) is quite clear in saying that a bank issuing a letter of credit is obligated to honour (i.e. pay
according to the terms of the credit) provided the stipulated documents are presented to the nominated bank or to the issuing bank
and that they constitute a complying presentation.
Now ? why is that so important? Is it not always the case that the exporters bank is a ?nominated bank??
No! it is not so ? UCP 600 sub-article 6(a) states that a ??credit must state the bank with which it is available or whether it is
available with any bank??.
This means for example that it may be available only with the issuing bank ? and place of expiry of the letter of credit may be at the
issuing bank ? i.e. often located in the country of the importer. Such structure of the letter credit has two main consequences from
the perspective of the exporter:
? The exporter?s bank is not nominated to act under the letter of credit ? meaning that such bank would in most cases be
reluctant to take on any kind of obligation ? like effecting prompt settlement.
? The risk of document being lost ? or just delayed ? in transit before reaching the issuing bank lies with the exporter.
Or in other words: a formal presentation according to the letter of credit rules has only been made when the documents reaches the
counters of the issuing bank where the letter of credit is available.
The difference here compared to the situation where the exporter?s bank is nominated to act under the credit is significant.
Here are the key differences:
? The obligation of the issuing bank is ?triggered? once a complying presentation is made to the nominated bank (and that
bank accepts to e.g. forward the documents to the issuing bank) ? regardless if that bank has chosen to act under the credit
This means also that such bank will often be prepared to offer additional services like paying the exporter before having
received the funds from the issuing bank.
? The risk of documents being lost or delayed in transit lies with the issuing bank (assuming that a complying presentation has
For that reason it is very important that the exporter carefully checks the letter of credit to determine with which bank it is available
and when and where it expires.
It should also be noted that a ?.. credit available with a nominated bank is also available with the issuing bank? ? meaning that the
beneficiary always has the option to present the documents directly to the issuing bank. Such option is only rarely used ? but may be
convenient where for example the nominated bank is closed for force majeure reasons. In that case it is important to note that the
documents must still be at the issuing bank on or before the time limits set by the credit.
Issuing bank: Bank A, Italy
Ending this I will share with you a real case that is not unlike many letters of credit
being issued today:
31D: Date and place of expiry
In this case the credit has been structured in such a way that documents may be
delivered to a bank in China. However no bank in China is nominated to act under
this credit ? as it is only available with the issuing bank in Italy. Such structure is not
in line with the UCP 600 ? and may be labeled ?ambiguous?.
This structure however may work well in many cases ? but from the perspective of
the exporter it is important to observe that no formal presentation has been made
when the documents are delivered in China ? even where such delivery is timely. So
for example where the documents are lost in transit between the bank in China and
the bank in Italy ? that risk lies with the exporter.
41A: Available with .. by
Consequently before accepting such letter of credit the exporter should carefully
Bank A by payment
consider the (additional) risk elements involved ? and decide whether or not (s)he is
willing to accept these risks.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 13
Give Your CV a Certified Career Boost !
Perhaps you will think I am crazy when I say this, but I believe
now has never been a better time to consider a career in
What? You ask in disbelief? Is this guy crazy? Doesn't he know there's a
recession out there?
YES! I do, and I am sticking to my guns on this one! Let me explain why...
Yes we are experiencing a downturn and there are less jobs out there, but in
Name: Thomas Smith
the area of International Trade and related fields such as Logistics, Shipping,
Position: Operations Director
and Trade Finance there are opportunities to be had for those who have a clear
understanding of the mechanics of International Trade!
Location: Kiltimagh, Ireland
Specialisation: International Trade Training
Picture yourself in an interview for a position in an exporting company...
whether it be as Warehouse Supervisor, Supply Chain Assistant, Import/Export
Clerk, Export Sales Executive... all these positions require a specific set of skills
that have been hard to find in one place? Until Now!
E-Learning, of course, overcomes this, IF you can carry out your professional development in a structured manner, and
obtain internationally recognised qualifications at the end of your studies. To the relief of training managers and trade
professionals both experienced and aspiring, the solution is now available through a specialised International Trade
School completely focused on certified courses in International Trade, Finance, Logistics and Shipping: The electronic
Business School International... they offer e-learning certifications as follows:
? Background to Shipping course from Institute of Chartered Shipbrokers UK
? Certificate in Trade Finance from the Institute of Export UK
? Certificate in Logistics from the Chartered Institute of Logistics and Transport
? Advanced Certificate in International Trade from the Institute of Export UK
? International Trade Specialist Accreditation from Institute of International Trade of Ireland
? Foundation Diploma in Shipping from the Institute of Chartered Shipbrokers UK
? Diploma in Export Operations from the Institute of International Trade of Ireland
? Advanced Diploma in Shipping from the Institute of Chartered Shipbrokers UK
? Institute of Chartered Shipbrokers Membership Exams
As you can see, there are a broad range of training
options and one can easily pick and choose a clear path
to any number of career specialisations.
From the diagram we can see that the skills offered
above can be applied to a broad range of business
types such as:
? Internationally Trading SME?s
? Trade Service Providers
? Exporting Multinationals
? Shipping and Logistics Firms
? Customs Brokerages
? And export agents!
Its up to you, the reader to decide what area of this
exciting career you want to enter!
Export Sales Career
One example of an e-learning career development route would involve taking
the International Trade Specialist (ITS) Accreditation programme from eBSI
which leads upon completion to the Advanced Certificate in International
Trade (ACIT) awarded by the Institute of Export. Further study can bring you
to the Diploma in Export Operations from the Institute of International Trade
of Ireland. You can even get a free Dell Laptop as part of a special course
bundle covering the ITS Accreditation!
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 14
At present, ITS Accreditation holders are granted complete exemption from the
Advance Certificate plus one Diploma subject in the Institute?s full professional
examinations. This means that ITS is recognised at the level a bit beyond level 3 and
HNC, and its holders will be awarded the Diploma in International Trade from the
Institute of Export UK by completing the remaining 3 Diploma subjects (level 4) only.
This would then qualify them for full membership of the Institute of Export UK.
Institute of Export UK and City & Guilds of London Co-validation
In the United Kingdom, Full Members of the Institute of Export can be assessed for
the City & Guilds Licentiateship in Export Management by experience and job
position, without examination, by using the ITS to satisfy the CPD requirement for
the award of the Licentiateship (NVQ level 4) under the ?vocational education and
experience route?. The stipulated CPD requirement for this route is 100 CPD Credits,
and ITS Accreditation, as officially confirmed by the Institute of Export UK, is worth
exactly 100 CPD Credits.
The ITS Accreditation thus offers to mid-career executives the most time and cost
effective way to getting an internationally recognised NVQ level 4 qualification in
US Academic Evaluation
Finally, according to US academic evaluating agencies, the
credit worth of IoE Advanced Certificate and Diploma is 4
semester credits per subject. This means that the ITS
Certification is worth 4 x 5 = 20 semester credits within the
US academic system. Again, real progress as international
institutions make a vote of confidence in the ITS Accreditation
The International Trade Specialist Accreditation helps
individuals and organizations move beyond simply obtaining
assistance with International Trade matters from available
external resources, to a level of self-sufficiency by building
your own internal expertise in the area of International Trade.
Flexible Role Based Learning
The spectrum of courses offered by the eBSI allows inexperienced and
experienced learners alike the chance to pick and choose their certified
training as best meets their professional requirements at any given time.
Export Sales Executives are more important than ever in Irish and UK
based companies as internationally focused businesses, particularly SME's
struggle to compete in a more difficult global environment. A good supply
chain specialist could mean the difference between maintaining
competitive position in one's core business and losing out to cheaper
competitors. A good Trade & Compliance specialist can ensure cost
savings throughout the international function of the exporting SME. All
these roles can be achieved through the certified programmes outlined in
this article, your only question really should be... which way will your
heart carry you!
Who's in YOUR professional network?
A key element in e-learning certifications facilitated by eBSI is the synergy of networks that often takes place between
participants. Because of the cross functional approach of the certifications, participants gain greater exposure to
complimentary skill sets than could be the case when studying alone. A Shipping clerk working in a freight forwarder can
help a small SME exporter and bring in new business for their company. A trade banker can help that shipping clerk with
the correct preparation of a transport document for presentation under a documentary credit. The possibilities are limited
only by your imagination and your eye for opportunity. Graduates of eBSI certifications gain lifetime membership of the
eBSI Online Campus in order to ensure lifelong sharing of knowledge and also membership of an International Trade
oriented Business Networking site Trade Professional.net where they can manage their professional network and develop
life long relationships with fellow trade professionals.
Grants and Assistance towards Training
A number of Agencies and Organisations provide assistance in part funding training programmes in the areas of
International Trade. For Example FAS can offer up to 50% grant aid on for participants working in SME's who wish to take
the ITS Accreditation Programme. The Chambers of Commerce of Ireland can also provide support through their
International Trade Skillnet. Participants from Emerging Markets can apply for grants of up to 60% depending on their
For more information about the certified training outlined in this article feel free to contact Thomas Smith at eBSI on
Tel: +353 94 93 81444 or email firstname.lastname@example.org.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 15
eBSI Recent Events
We have been clocking up a lot of air miles while delivering seminars and attending conferences
around the world, here is a brief overview of some of our more notable appearances this year!
A Workshop was held in Ulaanbaatar, Mongolia, on 14 June 2008 covering
International Banking Practice. The workshop was organised by Tuushin
International Freight Forwarding and delivered by eBSI First Director and Finance
Tutor, Vincent O'Brien.
Mr Vincent O?Brien with participants at Tuushin International Freight Forwarding
?International Banking Practice Workshop?
A workshop was held in Muscat, Oman on 2-3 June 2008 covering International
Standard Banking Practices. The 2 day workshop was organised by National Bank
of Oman and delivered by eBSI First Director and Finance Tutor, Vincent O'Brien.
According to M. Ramalingam Head-Trade Services at National Bank of Oman ?This
was the most practical trade finance training we have ever experienced?.
Vincent O?Brien with Participants of National Bank of Oman at
ISBP workshop held in Muscat on 2 June 2008
A Trade Finance Workshop was held in Commercial Bank of Qatar in Doha on
the 31st of May 2008 covering a broad range of trade finance issues. The
workshop was delivered by eBSI First Director, Vincent O'Brien.
Vincent O?Brien, eBSI Director with Participants at Trade Finance Workshop
at Commercial Bank of Qatar on 31 May 2008
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 16
eBSI Recent Events
Dubai, United Arab Emirates
A workshop was held in United Arab Bank in Dubai, United Arab Emirates on 29
May covering International Standard Banking Practices. The training was
delivered by eBSI First Director and Finance Tutor, Vincent O'Brien.
Vincent O?Brien, Director of eBSI with Participants at ISBP workshop with
United Arab Bank UAE, held in Dubai on 29 May 2008
eBSI was joint sponsor or the first Arab Logistics and Multimodal Transport
Conference which was held in Amman, Jordan on 22-23 May 2008. Conference
outline can be downloaded from http://www.ebsi.ie/news/Conference12.pdf
Vincent O?Brien lead a panel discussion on the latest developments in trade finance rules,
trade finance processing and use of verification and authentication technology to an
audience of delegates predominantly from the Middle East and from another 17 countries.
A Seminar was held in Ljubljana, Slovenia on 13-14 May covering International
Standard Banking Practices. The 2 day workshop, organised by ICC Slovenia,
was delivered by eBSI First Director and Finance Tutor, Vincent O'Brien.
Vincent O?Brien with participants at ISBP workshop in Ljubliana Slovenia
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 17
eBSI Recent Events
Bank Asia Limited, Zonal Office, Agrabad C/A, Chittagong, Bangladesh.
On 21st March, 2008 a workshop on the Transport Documents Articles of UCP-600
was delivered by eBSI and IFC FIT Initiative local tutor Mr. Md. Bakhteyer Hossain.
This workshop also saw the launch of the "Documentary Credit Forum, Chittagong",
comprising 35 banker members working in the Trade Finance area from 14 Banks
in Chittagong. The Documentary Credit Forum, Chittagong has been established
with an objective to develop Trade Finance skills among professionals at regional
level. Chittagong is the main port city and Business capital of Bangladesh.
This is the first time that such a forum has been formed in Bangladesh. There is no
such Forum in the capital city of Dhaka. A.T.M. Nesaruddin, Senior Officer of Bank
Asia Ltd., also delivered an engaging presentation on "Exclusion of Articles of UCP-
600: A Troublesome Trend".
The forum generated lot of enthusiasm among Trade Finance people in Chittagong.
Participants at seminar conducted by Md. Bakhteyer Hossain in Agrabad, Chittagong at the
launch of the Documentary Credit Forum, Chittagong.
Cox's Bazzar, Bangladesh
Hotel Seagull, Cox's Bazar. On 15th March, 2008 a workshop on UCP-600
was conducted by eBSI and IFC FIT Initiative local Tutor for Bangladesh Mr.
Md. Bakhteyer Hossain. Approximately 30 participants from 6 Banks in
Dhaka were present at the seminar. The workshop covered the evolution,
background, development & changes from UCP500 to UCP600.
The new IFC-FIT Initiative launched earlier in Dhaka and Chittagong was
also introduced to the participants.
Participants at seminar conducted by Md. Bakhteyer Hossain
in Hotel Seagull Cox's Bazzar.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 18
eBSI Recent Events
Board Room, ICC Bangladesh Office, Dhaka, Bangladesh.
On 6th March, 2008 a meeting to exchange views and tips for the upcoming
CDCS exams was held at ICC Dhaka.
The meeting and open house discussion was conducted by ICC Bangladesh for
the CDCS Candidates from Bangladesh who were due to sit the CDCS Exam for
2008. Speakers at this event included Mr. Mahbubur Rahman, President, ICC
Bangladesh, Mr. Vincent O'Brien, First Director of eBSI & member of ICC
Banking Commission, Mr. Ataur Rahman, Secretary, ICC Bangladesh, Dr. Taufiq
A. Chowdhury of Bangladesh Institute of Bank Management (BIBM) & Mr. Md.
Bakhteyer Hossain, CDCS & International Trade Specialist (ITS).
Candidates for CDCS Exams in Bangladesh discussing the exams with Vincent O'Brien and
ICC Bangladesh Resource persons.
Port of Spain, Trinidad & Tobago
eBSI worked with the International Finance Corporation in delivering a week long
Trade Finance Operations Course which was developed specifically for Latin
American and Caribbean Banks from the region. eBSI Finance of International
Trade Tutor, Mr. Pavel Andrle delivered the Training.
Pavel Andrle with participants of the Trade Finance course in Trinidad.
Certificate in Finance of International Trade
Learn all you need to know about Methods of Payment & Finance!
? Online Tutorials with ICC Banking Commission Members Contact us for more details:
? Certified by the Institute of Export UK The electronic Business School International
? Includes ICC Online Training in UCP 600 Tel: +353 94 9381444 Fax: +353 94 9381708
? Recognised by International Finance Corporation Web: http://www.ebsi.ie Email: email@example.com
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 19
China Systems Trade Tutorial
Incoterms 2000 ? Forewarned is forearmed!
With the revision process now underway for the next edition of
Incoterms, Mark Zeller in South Africa reviews some of the
pitfalls of underestimating the importance of the current set of
International Commercial Terms, more commonly known as
Name: Mark Zeller
Most readers who are involved in international sales will have been asked for a
Position: Customs Consultant
pro forma invoice at one stage or another quoting EXWorks, FOB, CIF or DDP
Employer: Self employed
prices; to name but a few. But what are these mysterious codes for, and what
Location: Durban, South Africa
are the real implications of their use in international sales contracts?
Specialisation: African Customs Regulations
First of all, lets get our definitions correct. The word 'INCOTERM' is an
abbreviation of ?International Commercial Term? and the chosen INCOTERM is a
term of the contract of sale. The International Chamber of Commerce (ICC)
created INCOTERMS in 1936. Since then, this set of international commercial
terms has undergone revisions in 1953, 1967, 1976, 1980, 1990 and the latest
revision was brought out in 2000. The ICC has now set to work, through the
establishment of the ICC Taskforce on Incoterms, Chaired by Charles
Welcome to our new
Debattista (Professor of Commercial Law, University of Southampton) on
series of Technical Trade
bringing these essential trade terms up to date within the context of our
Articles sponsored by
changed trading environment.
Incoterms enable the contracting parties to set out clearly and concisely the
extent of their respective obligations, and above all, the moment when costs
and risks are transferred from the exporter to the importer.
In Incoterms 2000, the parties define the point to which the exporter is
responsible for the goods and what are the expenses relating to his
obligations which will therefore have to be included in the price offered by the
Identification of these responsibilities and costs is made clear when the point
of handover of risks - always a physical location - is effectively decided upon
by the buyer and seller. As a general rule (there are exceptions as we will see
later) all risks and responsibilities that the cargo might be subject to prior to
the cargo?s arrival at the agreed and named place are the concern of the
seller. All risks and responsibilities that the cargo might be subject to after
the cargo?s arrival at the agreed and named place are the concern of the
INCOTERMS 2000 are like shorthand - a series of expressions that buyers and sellers will communicate in and
understand regardless of their home language. The system of expressing Commercial Terms as a universally
understandable set of codes allows buyers and sellers, who may not share the same language, to establish their
individual responsibilities to the other party clearly ? thereby avoiding dispute as best as possible. Even when the actual
spoken language used by the buyer and seller is the same, using a set standard for Commercial Terms minimizes the
possibility of misunderstanding.
It is important to realize that, while these are available to use in any sales situation, they are by no means universally
enforced. Traders therefore have the freedom to engage in trade without using INCOTERMS. The impact of this freedom
of practice results in assumptions and misunderstandings using similar expressions. These lead to lengthy, unwanted
Of further importance, the prudent trader needs to recognise that INCOTERMS cannot deal with everything. They
therefore need to be used in conjunction with the International Contract of Sale ? possibly mentioned more than any
other document within the text of INCOTERMS 2000 and yet arguably one of the most underused documents in trade
today. Another prominent exclusion is the issue of ownership or title ? the moment of transfer of title must be clearly
established within the International Contract of Sale, as this is not within the scope of INCOTERMS 2000.
Any tool can be used correctly or incorrectly. In order to use INCOTERMS 2000
effectively, and enjoy the recognition of an International body such as the ICC, these
codes need to be used according to their individual design. Incorrect usage can actually
work against the trader and/or service provider, because they may have disregarded a
particular term's spirit and should have either used it in a different way, or changed their
term altogether. An obvious example of this is using a mono-modal term for a multi-
modal shipment. Should they fall into dispute, traders may risk the exposure of
judgment against them in a court of law, as the term has not been properly utilised.
ELECTRONIC BUSINESS SCHOOL INTERNATIONAL 20
Another case in point was described by an eBSI graduate in the Czech Republic in relation to a shipment to Moscow under
the CIP INCOTERM. Under INCOTERMS 2000, ICC Publication 560, CIP means CARRIAGE AND INSURANCE PAID TO (...
named place of destination). Under the case in question the shipment had been loaded on a truck in Prague, Czech
Republic, but had been stopped and stolen just prior to arrival to Moscow, its named place of destination. The buyer in
Russia refused to pay for the goods claiming that the Czech Exporter had not fulfilled their delivery obligation under
INCOTERMS 2000. However, upon closer examination of the wording of the CIP INCOTERM, the Czech Exporter was able
to clearly establish to his buyer that his delivery obl