Mr Old Man Payment Q&A Deleting “Acceptance” from UCP 600? A Practical Question By Mr Old Man Posted on 11 minutes ago 4 min read 0 0 1 Share on Facebook Share on Twitter Share on Google+ Share on Reddit Share on Pinterest Share on Linkedin Share on Tumblr As discussions continue around whether UCP 600 should be revised, some suggestions focus not on rewriting the rules entirely, but on simplifying specific provisions. One such suggestion is to remove availability by acceptance under Article 6(b), on the basis that drafts are no longer necessary in modern practice. At first glance, this seems reasonable. But as often in trade finance, the answer depends on how the rules interact with practice across different markets. Question Dear Mr. Old Man, I would be in favor of modifying only a few articles in order to simplify the use of LCs, such as Article 6(b), by deleting availability by acceptance. Updating the rules does not mean rewriting them entirely, but only adjusting what is necessary — as is done with traffic rules in many countries. Best regards, XFA _____ Answer Dear XFA, Thank you for your thoughtful suggestion. I understand the rationale behind simplifying LCs by removing availability by acceptance under Article 6(b). In many cases today, drafts are not strictly necessary, and transactions can be structured more simply using deferred payment credits. However, drafts remain mandatory in certain jurisdictions. Usance LCs issued in favour of beneficiaries in those markets still require drafts, and in such situations availability by acceptance continues to serve a practical purpose. Where drafts are not required, issuing credits available by deferred payment already provides a workable and widely used alternative. As noted in the broader discussion, recent exchanges within the ICC Banking Commission suggest a clear direction: greater emphasis is being placed on improving practice — through ISBP updates, ICC Opinions and training — rather than revising UCP at the rule level. ICC has also provided guidance on the use of drafts in documentary credits. In that context, it may not be necessary to amend Article 6(b) at this stage. Any revision could be considered as part of a broader update, should more substantive issues arise. Best regards, Mr. Old Man ___ A closing thought In trade finance, what looks unnecessary in one market may still be essential in another. Rules tend to stay — because practice does not move at the same speed everywhere. And sometimes, keeping an option is simpler than removing it.