TradeBrief. ICC Banking Commission Meeting and Trade Finance Summit in China. EBSI EXPORT ACADEMY 1

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1 ICC BANKING COMMISSION COVERAGE...1 EBRD TRADE FINANCE FORUM...5 CMBC TRADE FINANCE SEMINAR...8 RECEIVABLES FINANCING...9 WEBLINKS FOR EXPORTERS...13 IFC FIT INITIATIVE UPDATE...14 INTL. STANDARD SANCTIONS PRACTICE...17 CHINA SYSTEMS UPDATE...19 FINANCING NIGERIAN SME EXPORTERS...20 EU COMPETITION RULES...22 RECENT EVENTS...25 ISSUE 8 Jan ICC Banking Commission Meeting and Trade Finance Summit in China Beijing, China The ICC Banking Commission meeting held in Beijing from 24 to 28 October was hosted by ICC China and attracted participation from more than 100 countries. This was a very important meeting for the ICC with its long history of international trade rule making and facilitating trade. The Banking Commission also celebrated it s 80th birthday. While the world economy founders on debt and unemployment, trade and finance experts participating in the summit emphasized that trade has been the single most important source of growth and jobs over the past 60 years and that trade finance must be made more accessible and affordable, particularly for developing countries and small- and medium-sized enterprises. A high point of the event was the Trade Finance Summit held on Friday 28 October. The Trade Finance Summit was directed by ICC China and brought together the leading stakeholders in international trade and finance dealing with key issues affecting the international trade finance community. Primary multilateral institutions, including the International Monetary Fund, the World Bank, the European Bank for Reconstruction and Development, the Asian Development Bank and International Finance Corporation, along with other leading international trade institutions participated in the panel discussions. Zhu Guangyao, Chinese Vice Minister of Finance, and Liu Mingkang, Chairman, China Banking Regulatory Commission, were the keynote speakers. Speaking at the ICC Banking Commission in China, Liu Mingkang, Chairman, China Banking Regulatory Commission EBSI EXPORT ACADEMY 1

2 ICC Banking Commission China The ICC s Market Intelligence Group joined the debate on the changing patterns of World trade. It was clearly demonstrated that the role of the development banks in supporting trade during the continuing financial crisis is of utmost importance Ms. Kamola Makhmudova of the EBRD Trade Facilitation Program elaborated on the enhanced role of the EBRD in supporting trade, the EBRD s crisis response and focused on the importance or inter-regional trade in the EBRD countries of operation. The trend in the expansion of trade within Central Asia was clearly demonstrated by way of defined examples and case studies. The importance of the trade related data being provided to the international banking industry was discussed and it was decided that the next ICC Market Intelligence Survey will get underway in January ICC Report Global Risks Trade Finance 2011 During the event, a new report issued by ICC, Global Risks Trade Finance 2011, showed that trade finance is a relatively low-risk asset class that should not be feared by banks, nor overregulated by governments. Kamola Makhmudova, Principal Banker, EBRD TFP. According to Makhmudova an essential requirement to develop trade is to develop people and that requires a strong dedication to capacity building in trade finance skills and expertise ICC also said it was pleased that the Basel Committee on Banking Supervision had announced measures that recognize trade finance as a low-risk activity for banks, and said that there is opportunity to further refine the rules to foster the development of trade and the support of SME clients. Vincent O Brien, Chair of the ICC Banking Commission, Market Intelligence Group (MIG) said progress has been achieved - less than anticipated and more needs to be done. The results of the next global survey will be presented at the next ICC Banking Commission Meeting scheduled for 25 to 29 March 2012 in Doha Qatar Major International Attendance The ICC Trade Finance Summit and Banking Commission meeting brought together some 600 eminent banking professionals, international organizations and supervisory bodies from over 100 countries to examine the key trade and finance challenges faced by the industry. Vincent O Brien speaking at the meeting Mr Li Yi, Bank of China, winner of the ICC Tools for Trade price receives his ICC Toolbox Distinguished delegates at the ICC Banking Commission Meeting EBSI EXPORT ACADEMY 2

3 Directors Note Welcome to this eighth edition of Tradebrief and wishing you a happy and prosperous 2012 Without any doubt 2012 will be a challenging year for the international trade and finance community around the World. However, I believe that we can be optimistic on a number of fronts. News & Commentary - Corporate Training Success Besides its activities in seminar based training/consulting in Trade Finance, and online training certifications in International Trade and Finance, has been growing in notoriety in the highly competitive area of Online Corporate Training. The success of the International Finance Corporation s Finance of International Trade Initiative, or the IFC FIT Initiative as it is more commonly known is one facet of a broader area of customised training which is now more and more sought after by banks and large organisations when it comes to structuring their training. has a large repository of International Trade, Trade Finance, and ebusiness related training from which it can draw upon and customise for corporate clients. This customisation can reach the level of a fully branded solution such as that delivered jointly by and the International Finance Corporation at through to data rich curricula and jointly certified training courses delivered online such as that delivered for Commercial Bank of Dubai. The Trade Finance Department recently completed the program which included an initialisation seminar at the start of the program and the final graduation event pictured below where the graduates received their international certification. When I look close to home I can see that Irish exports are expanding and this clearly demonstrates that growth is driven by trade. To undertake trade you need to know trade and again this is reflected in the growing demand for training initiatives, whether traditional or by electronic learning. Best of luck in 2012! Vin On behalf of the Learning & Development team of Stanbic IBTC Bank, Lagos, Nigeria, I write to commend Export Academy for the success of the International Trade and Finance course recently concluded by some of our staff. A key deliverable for the L&D team last year was to put together a well structured Trade program that will help to broaden trade knowledge of a key sales group. The on line Trade course was structured as a key part of a blended trade accreditation program that was developed in house. Over 50 delegates from the Bank successfully completed the program. We sincerely thank and appreciate for their relentless support and assistance to the delegates through the program. The students found the course very easy to understand and valuable. The progressive module assessments kept participants on their toes while the availability of course materials on CD and PDF as well as interactively online allowed for greater flexibility for all concerned. Afolake Okoro, Learning & Development Stanbic IBTC Bank, Lagos, Nigeria As well as providing a level of flexibility in terms of course curriculum and mode of delivery, corporate training packages from tend to be better priced due to the application of group rates with the contracting organization. Bulk licenses are purchased at the start of the program and pricing is based on numbers of participants and the level of customisation involved. In 2012 s main focus will be on building on the success of previous online customised courses such as those mentioned here with Stanbic Nigeria, Infosys in India and Commercial Bank of Dubai. We welcome enquiries and will be happy to demonstrate our full corporate elearning capability to those contacting Thomas Smith at ts@ebsi.ie. Thomas Smith I worked with Export Academy in structuring a training program for my organization, Infosys Technologies. I Found them very energetic, extremely open to ideas and suggestions and creative in the options for engagement during the structuring and delivery of the program. It has been a real pleasure working with and would love to do so in the future as well. Jayakumar Ventakaraman, Infosys Technologies, Mumbai, India EBSI EXPORT ACADEMY 3

4 Expert Commentary Ireland China Trade IT components make up the bulk (61%) of Ireland s sales to China, according to Burke Shipping Group in China. The decision to open an office in Shanghai four years ago, right before the economic crisis, has proven wise according to Ciaran McCann, man-in-china for Burke Shipping Group. McCann says his Shanghai office makes it easier for Irish customers shipping to or sourcing from China. While the volumes were there the service wasn t, having someone on the ground who understands the lingua franca is what Irish customers want. Bigger peers include Shenkers and Kuehne & Nagle, the former with thousands off staff in 26 offices around China. But we are faster, more nimble, that suits Irish customers. Expert Profile Name: Ciaran McCann Position: Managing Director Employer: Burk Shipping Group Shanghai Location: Shanghai, China Specialisation: International Logistics Contact: cmccann@bsg-shanghai.com.cn In cash terms food exports and pharmaceutical items (5% each) and medical devices (3%), account for lesser shares of Ireland s shipments to China, but these will grow says McCann. Separate from the food category, infant milk powder is a huge 15% and a major dairy earner for Ireland s trade to China. Volume-wise waste (waste paper and plastic) historically ranked high in Irish exports to China, as had metal scrap. But those volumes are dropping compared to pre-crash levels as packaging use drops in a recessive Irish economy while movement of major Dell operations to Poland has also cut the use of packing. McCann sees a lot of potential to grow food and drink volumes from Ireland to feed China s nouveau riche. While alcohol exports to the US are higher than alcohol exports to China it is interesting to note that sales of Irish food to China are now on a par with those in the US. As for shipments from China to Ireland, volumes of scaffolding and engineering items may be down but McCann says renewable energy equipment has proven a replacement. China after all is the world s number one producer of solar panels and a key maker of wind turbines. Goods coming from China to Ireland (which presently doesn t have any ports with deep enough water for very large ocean going container vessels, all containers being trans shipped at ports such as Rotterdam, Antwerp, LeHavre and Hamburg) include white goods, garments, furniture along with many other fast moving consumer goods (FMCG). It has been argued by some experts that if Ireland developed some of it s deep water harbours into deep water ports Ireland could become China s gateway to Europe. As well as being a travel agent for shippers, Burke Shipping Group is a port terminal operator in Dublin, Cork and Belfast. McCann sees a pay back too from Burke s strategy in helping customers find suppliers here. if the deal doesn t work out with other bigger logistics companies or they won t help you find alternatives in China, we will. As our customers develop so do we. With key shipping firms Maersk and Hong Kong s Orient Overseas both cutting China-EU capacity in November (the latter by 20%) it may be a shipper s market, though fuel prices will likely determine how rates change in Rates change weekly but it costs approx $900 (20 foot) to $1700 (40 foot) to ship a container from China to Ireland. After a period of discounting post-2008 shipping firms have now repositioned ships to other regions. There were 1000s of container ships parked up in Singapore a few years ago, they have now been redirected however it remains our job to secure the best price for our customers McCann sees more of Burke s China revenue out of a non-irish clientele keen for a logistics service into the hinterlands of China and its neighbours. McCann explains how it took years of meetings to build an inland network allowing Burke to ship into and from China s interior cities like Changsha and Chongqing: this is important given a shift of manufacturing into these lower-waged metropolises. There s also a niche in supplying other regional growing economies such as India: Burke Shipping Group being involved in China India on a number of levels. Ciaran McCann EBSI EXPORT ACADEMY 4

5 r EBRD Conference w202 EBRD Trade Finance Forum Istanbul 2011 EBRD Response to the Global Financial Crisis The EBRD in conjunction with Turkiye Is Bankasi AS, Bank of Georgia and Landesbank Baden-Wurtemburg and Commerzbank organised a major international Conference to look at the status of regional trade in the context of the Global Financial Crisis. The Forum was an opportunity for EBRD Issuing Banks to learn about the situation in other countries of the EBRD with panels covering the Banks in Turkey, Russia, Western Caucasus, Azerbaijan, Mongolia, Belarus and Moldova as well as presentations from many Confirming Banks. Turkey and the EBRD EBRD added Turkey to its countries of Operations in 2009 and has since then has invested in 44 Projects with a total projects valued at EUR 4 Billion. The main areas of intervention and support are in the Energy, Telecommunications, Regional SME development and the Agribusiness Sector. With a population of 75 million people and located at the doorstep of Europe, Turkey presents huge opportunities from both the Import and Export side. Income per capita in Turkey has grown steadily over the last 7 years reaching USD 15,210 in December EBSI EXPORT ACADEMY 5

6 EBRD Conference Effect of the Global Financial Crisis While Turkey did experience problems as a result of the Global Financial Crisis with its budget deficit swelling to $15 billion in the first half of 2009, 13 times higher than the previous year, overall, thanks to firmer regulation of its banks, Turkey has weathered the crisis much better with few toxic assets and limited mortgage exposure. Turkey is one of the few countries that has actually improved its credit rating and outlook from the international rating agencies such as Standard and Poors, Fitch and Moody s since the crisis. was well represented with Tamara Khizhanishvili from Bank of Georgia and Dimitry Predius from Mobiasbanka Societe Generale in Moldova, both ITS Graduates, representing their banks at the conference (pictured above). Other notable participants pictured are Leo Cullen of Coastline Solutions pictured with Pavel Andrle (right), and EBRD head of the TFP, Rudolf Putz with Kamola Makhmudova, Thomas Smith of and Angelika Stricklova and Aneta Anguelova. EBSI EXPORT ACADEMY 6

7 Documentary Credits Financial Engineering It is well known that for quite some time, the financial institutions have had the credit tap closed, which has caused a number of problems for companies. One might ask why this closure has occurred and, though not the ultimate goal of this article, try to give answers. Basically, in Spain as in many other countries, the tap is closed for two reasons. A liquidity problem and a risk problem. For years, Spain and some other countries, have been investing in real estate primarily in the form of mortgage loans, all transactions in the long term, which means that the financial institutions did not recover the amounts borrowed in the short term, but the money was immobilized and consequently, diminished liquidity. Expert Commentary Expert Profile Name: Xavier Fornt Position: Professor International Economics Employer: College of International Business Location: Barcelona, Spain Specialisation: International Trade Finance Contact: xavier_fornt@yahoo.es The central banks have tried to alleviate this situation, putting more money into circulation, so as to prevent market failure. But then, the second question has come into play, and financial institutions, many of them cleaned out in real estate transactions have begun to more closely examine the risk analysis of operations and have entered a phase of doubts about the viability of the return of loans and hardened their risk policy tremendously. As mentioned, the aim of the article is not to analyze the credit situation but note that companies, whether small, medium or large, have at the moment, for reasons that are evident, difficulties in finding financing. And when the outlook is not favourable, we must sharpen our wits. Companies have seen that some financial institutions are more likely to grant lines of guarantees or collateral but prevent the granting of credit lines or cash loans. These transactions do not require the banks to affect their liquidity as much as standard loans. Entities that do have cash and are willing to risk in the form of granting credit or loans, have increased the bar for their risk analysis, and call often for guarantees from borrowers not previously requested. And here appears to enter the concept of corporate financial engineering, transforming lines of collateral or guarantees, into credits and loans and liquidity. Recently in the market some documentary credits, which we all know are a form of conditional guarantees, that have as its parties the applicant and beneficiary as the same company. Clearly, this operation would not make much sense. In the documentary credit, the payer is the importer, who requests its bank to guarantee to the seller payment, if certain conditions are met. However, this operation would not make much sense if the buyer and seller were the same company. What could be behind this apparent nonsense? It is probably a company that works with two banks, one of whom has a line of guarantees and collateral, but not liquidity, and the other has a line of credit, loan or discount, provided that the company provides guarantees. This operation uses the entity that is willing only to provide guarantees (the documentary credit is one of them) as the collateral or guarantee to satisfy the entity that is willing to make loans or discounts, based on the aforementioned guarantee. Technically, the Rules for Documentary Credits of the International Chamber of Commerce, the UCP 600 do not preclude the payer and payee to be the same person or entity, although it is true that this type of operation is not often seen in the market and may attract ones attention. But it is said that necessity is the mother of invention. Xavier EBSI EXPORT ACADEMY 7

8 CMBC Trade Finance Seminar CMBC Host IIBLP/ICC China Trade Finance Seminar in Beijing The China Minsheng Banking Corporation graciously sponsored the seminar delivered by the Institute of International Banking Law and Practice in collaboration with the ICC China National Committee to deliver a combined Seminar and Survey of LC, Standby and Guarantee Practice on October Mr. Liang Yutang, Vice President of CMBC and Mr. Lin Zhihong, President of trade finance department of CMBC both provided insightful speeches at the event. China is currently the fastest expanding market for letters of credit, guarantees and standby letters of credit. This seminar is the world s premier letter of credit event which brings together perspectives on LC law & practice from every region of the World into a twoday interactive and intensive dialogue by leading international and Chinese experts in both law and Structure of the Seminar Day One focused on commercial letter of credit practice, cases and issues. Day Two focused on demand guarantees and standby letters of credit. The sessions address current issues, problems of which you should be aware, predictions, trends, and legal developments. The welcome address was given by Mr. Liang Yutang, Vice President of CMBC The Seminar discussed the implications of legal cases from the following countries and regions: China, Hong Kong, Singapore, Malaysia, Taiwan, the U.S.A., Canada, Australia, the U.K., England, South Africa, India, Tunisia, Dubai, and the Philippines. Delegates also had the opportunity to pose questions to the panel of leading experts and hear firsthand practical solutions and recommendations. Future IIBLP Events in 2012 Annual LC Survey New York March 2012 Hong Kong - 14 July 2012 Singapore July 2012 Istanbul October 2012 Guarantee & Standby Forums Hong Kong - 13 July 2012 Singapore - 18 July 2012 London - October 2012 Visit for updates on events and other seminars and publications from the IIBLP. EBSI EXPORT ACADEMY 8

9 Expert Commentary Growth beckons for receivables finance in the new normal Understanding your economic and commercial environment is, of course, essential for doing business. But at the moment this environment seems to be changing almost daily. The environment that receivables financiers work in has always been fairly dynamic, but the current economic and banking situation has taken this to new levels. One thing is certain and that is the commercial finance playing field has changed for good; a line has been crossed. We have entered a new period, still unsettled, but forever different from the one we have just left. We have entered a new normal. The business world is beginning to see the strength of the receivable. And it s not just SMEs; it s also large corporates, sometimes very large. The crisis has projected the receivable into the spotlight more than ever before. Banks, financial institutions and corporates of all sizes are beginning to understand that the receivable is an asset that can be counted on much more than other assets. Its short-term, self-liquidating nature means that much of the, uncertainty of advancing against other assets are absent. Other reports suggest that investment in equities is reducing. There is a powerful new investor class in developing, particularly in emerging markets, whose investment decisions will help determine global demand for different asset classes. The actions of these new investors will impact on how businesses obtain the capital they need to grow and one of their investment choices could well be receivables. Expert Profile Name: Michael Bickers Position: Managing Director Employer: BCR Publishing Location: London, UK Specialisation: Factoring Contact: mb@bcrpub.co.uk The new normal is a phrase coined in 2009 by William Gross, the founder of the global investment management firm Pimco, He used it to describe the post crisis environment of slow growth, unemployment and inflation. At the time, Gross thought that we were pretty much out of the crisis. Well that clearly is not the case, although the nature of the crisis has of course changed, particularly in Europe. Yet for the receivables finance industry, the new normal could easily stand for high growth, new markets and record profits and could signal the beginning of a great time for the factoring and supply chain finance industries. For factoring and supply chain finance providers, the new normal may be quite a different environment to that of traditional bank lenders. Growth, out of the downturn, which will be sooner in some markets than others, could put new demands on recession-weakened balance sheets, as companies try to restock to meet new orders. And larger companies are increasingly interested in invoice finance structures as cash-flow becomes a central focus of many treasury operations. According to a recent report by the Hacket group, freeing up unnecessary working capital is the cheapest form of financing. There is now a much bigger focus on working capital and cash flow. This could mean that there are vast opportunities looming on the horizon for receivables financiers only around five per cent of trade receivables are currently financed in Europe; but according to Igor Zax, the author of recent research by the London Business School, the potential could be five times that figure. Factors, with their in-depth knowledge of receivables, are in a unique position to take advantage of these new opportunities. EBSI EXPORT ACADEMY 9

10 Expert Commentary But what will be the medium for such growth? Events of the crisis and downturn have accelerated and continue to drive a growing trend towards greater efficiency in the utilisation of excess working capital. There are three ways in which this is happening. Firstly, the increasing use of traditional methods of factoring; secondly, growth in supply chain finance and thirdly, the gradual but increasing use of receivables exchange type operations where businesses sell their receivables on-line to investors. What will oil the wheels of this process even further is the move towards document standardisation and document digitisation through the harnessing of technology to create fast information flows, and also the greater utilisation of credit insurance to make receivables funding propositions more attractive. This all points towards a significant and, arguably, inevitable commoditisation of receivables. This may not happen this year, it may not happen next year, but it seems likely that it will happen in the not too distant future. These are the processes of the new normal. The new normal, created in the fallout of the crises that has changed the way the business of commercial finance is being conducted. But commoditisation will not be comprehensive; there will still be a need for traditional forms of finance like factoring - it will be very hard to beat the strength of advancing against a ledger with a wide spread of relatively high risk debtors. The really big question is what are banks and factors going to do about getting some of this new business? Jack Welsh, who used to be CEO of General Electric, once said control your own destiny or someone else will. There is a lot of truth in that statement for this industry, because if the current providers are slow on the uptake on grabbing this new business as it emerges, others will - interest is growing fast. Factors and perhaps those rapidly gaining experience in supply chain finance should be able to exploit this growth as they have a head start; they understand the receivable better than anyone else. I believe that this is the challenge for today s forward thinking receivables financiers how to exploit the changes that are happening, how to take advantage of the huge increase in receivables financing that the business world is heading towards. That means learning about the new methods of freeing up cash tied up in working capital, targeting new market sectors and harnessing existing technologies in new ways. This is all part of the new normal and for factors to profit from it they must understand it. What is required is some different thinking, some thinking which is beyond that of traditional factoring, what is needed is some new normal thinking. Michael Bickers is editor of the World Factoring Yearbook and publisher of the World Supply Chain Finance Yearbook. Copies available from BCR Publishing: info@bcrpub.co.uk The future of receivables finance will be discussed at BCR Publishing s 12th annual Receivables Finance International conference and exhibition, March, Amsterdam. EBSI EXPORT ACADEMY 10

11 IDB Trade Operations Seminar Washington DC, USA A 2 day Trade Finance workshop was organised by Inter-American Development Bank and delivered by Vincent O Brien of on 8 and 9 th June This was the second formal training delivered by to IADB who are among the multilateral development banks who engage as a trade finance training provider. The objective of this trade finance workshop was to provide participants with the required tools to understand and analyse corporate customers trade finance needs so that they can provide trade finance solutions which match the customers needs and in turn generate continuing lines of income for their respective banks. The workshop was designed to guide the participants through the typical trading cycle identifying the correct trade product for different stages and situations and how to apply them. Participants from the regional offices of the IADB joined the staff at head quarters for this two day training program. Trade Finance Operations Program Outline The Trade Finance Operations seminar focused on the following areas in order to ensure first of all a proper understanding of the spectrum of trade finance products a bank can offer and how to manage them. Below is a summary of topics covered: * Benefits to Banks from International Trade Services. * Essentials to develop International Trade Services. * Payment and Risk Categories. * Understanding customers contracting requirements * Concise summary of Incoterms 2010 * Risk Analysis of Trade Products * Documentary Collection in Detail. * Managing Export Collections * Fundamentals of Documentary Credits * Types of Letter of Credit * Standby Letter of Credit * Bonds and Guarantees * Implications for Bank Customers * ICC Rules for the Issuance of Bonds and Guarantees * Receivables and Supply Chain Financing * Forfaiting * Factoring * Invoice Discounting * Warehouse Finance Vincent O Brien delivering the Trade Finance Training in Washington DC for IADB International Trade Certified Training Programmes Programme Intakes every two months from January & March 2009 Certificate in Logistics Certificate in Finance ITS Accreditation Advanced Certificate in International Trade & Logistics Diploma in Export Operations Certified Courses in Shipping Delivered exclusively by: The electronic Business School International Tel: Fax: Web: info@ebsi.ie EBSI EXPORT ACADEMY 11

12 Letters of credit: strict compliance and documentary discrepancies The Uniform Customs and Practice for Documentary Credits 500 ( UCP 500 ) is the predecessor to the UCP 600, which was published by the International Chamber of Commerce ( ICC ) in July The UCP are uniform rules for documentary credits which apply to a letter of credit where expressly incorporated. This case relates to a dispute arising out of a letter of credit incorporating the UCP 500 but is nonetheless relevant for its discussion of the doctrine of strict compliance in documentary credits and discrepant documents generally. The background facts S, an internet book retailer, entered into a sale agreement with a German book wholesaler, L, which required S to provide L with a guarantee for sums due to L. S therefore applied to RBS, which duly issued an irrevocable standby letter of credit. The credit expressly incorporated UCP 500 and provided that payment would be at sight on presentation of certain documents including a certified copy of the invoice evidencing the value of the goods delivered and a certified copy of the transport document. In return, S agreed to indemnify RBS in respect of its commitments to L and subsequently paid money into an account with RBS as security. After S went into liquidation, a dispute arose as to whether RBS had paid L against discrepant documents and whether it was consequently not entitled to debit S s account for the amounts paid. Expert Commentary Expert Profile Name: Steven Fox Position: Partner Organisation: Ince&Co Location: London Contact: steven.fox@incelaw.com Discrepant documents - Transport document The judge held that the transport document submitted by L, a letter from DHL referring to the number of packets consigned by DHL, together with a Packing List prepared by L, was non-compliant. The judge held that the transport document submitted by L, a letter from DHL referring to the number of packets consigned by DHL, together with a Packing List prepared by L, was non-compliant. Although the letter of credit had not specified the type of transport document required, the judge concluded that what was required was a document of the type referred to in UCP 500, for example, a bill of lading or air transport document issued by a carrier when the goods are consigned and evidencing that the goods have been despatched. Whilst UCP 500 also provides for transport documents issued by a courier, the DHL document in this case had not provided details as to the date or place of consignment nor as to the consignee and did not constitute evidence from DHL of the consignment of any goods to S s order at any time. The judge also held that presenting a single document as the transport document was not consistent with the invoice which, on its face, referred to many different transport documents, each with its own number. Article 13 of UCP 500 provides that documents which appear on their face to be inconsistent with one another will be considered as not appearing on their face to be in compliance with the terms and conditions of the Credit The Invoice According to the International Standard Banking Practice for the Examination of Documents under Documentary Credits ( ISBP ), an invoice must evidence the value of the goods shipped. Unit price(s), if any, and currency shown in the invoice must agree with that shown in the credit. The judge stated that the invoice had to be in the currency of the credit (in this case, sterling) because otherwise there would be uncertainty as to the sum to be paid under the credit, there being no basis on which to decide which exchange rate to apply and as at what date. Here, the amount in the invoice presented was one for which S had been invoiced for items supplied at various times during the previous year, in Euros, and L had simply applied an exchange rate from an unspecified source to the total of those sums as at the date of the invoice. The judge concluded that RBS had no sound basis for accepting that exchange rate or the date chosen for applying it and that it should have rejected the invoice as discrepant. The judge concluded that both RBS s payment to L and the debit to S s security account were unauthorised by S. Expert Profile Name: Reema Shour Position: Professional Support Lawyer Organisation: Ince&Co Location: London Contact: reema.shour@incelaw.com Ratification RBS sought to argue that accounting entries authorised by a director of S and subsequently by S s liquidator constituted ratification of RBS s payment to L because they purportedly demonstrated that S took the benefit of RBS s payment so as to reduce its debt to L. The judge disagreed and said that it was not possible to conclude that S ratified RBS s payment in circumstances where the company accounts expressly recorded that the payment was unauthorised, that S was maintaining a claim against RBS in that regard and that that claim was an asset of S. Unjust enrichment Whilst S had received payment in full from its customers, the judge disagreed that allowing S to recover from RBS would amount to unjust enrichment. Rather, as RBS s payment to L had been made without S s authority, it did not discharge S s debt to L and L could have pursued S for the full amount of the debt (and might have done so had RBS sought to join L in the proceedings and recover its payment to L on the basis that it had been made by mistake). Comment The terms of the letter of credit in this case were arguably unsuitable for the underlying trade relationship where L was despatching books directly to S s customers on an ongoing basis and there were thousands of individual delivery documents for the books supplied being transmitted electronically. However, this case highlights the fact that banks which pay against non-compliant documents cannot look to their customer even if their payment directly facilitates the delivery of goods to them. EBSI EXPORT ACADEMY 12

13 Weblinks for Exporters Weblinks for Exporters is a new section that will provide you 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 Import Export Directories Country Portals If you have a site to recommend then send it to Weblinks for Exporters at weblinks@ebsi.ie! China Systems is the biggest Trade Finance Software vendor in the world with a broad and loyal customer base. Their Eximbills Trade Finance System is a great platform to manage trade finance operations for any bank. Coracle Voice is a social media, news monitoring and online consultancy service for the shipping industry. Coracle Voice is brought to you by Coracle Onlinehttp://coraclevoice.co.uk/ Coracle delivers expert professional development packages and training solutions for the shipping industry. Their blended and adaptable skills courses allow shipping professionals to easily integrate education and training into their work or home lives. That is why counts Coracle as its strategic education partner for our clients in the Shipping industry. Check out their new iphone apps for the shipping industry at: A new Brazilian Government Portal offering the best of brazil to a world of hungry importers. Info on investing in Brazil is also available there. Export Law Blog is a very interesting and informative resource for anyone interested in International Trade Law or compliance issues with a wide variety of articles posted by various contributors. Exportcourse.com is a free online resource which offers basic guides to exporting and coordinates enrolments for Caribbean students of Export Academy. Their basic guides are an excellent primer for the more advanced studies offered by the International Trade Specialist Accreditation. A lively and interesting online forum and community focusing on trade with China. You can ask questions and get answers and find opportunities. GlobalTrade.net is an initiative from the Federation of International Trade Associations ( with the objective of being a knowledge resource for international trade professionals & a crossborder database of international trade service providers. The Global Small Business Blog (GSBB) was founded on July 20, 2004 by Laurel Delaney for the purpose of helping entrepreneurs and small businesses expand their businesses internationally. EBSI EXPORT ACADEMY 13

14 IFC FIT Initiative IFC FIT INITIATIVE EVENTS 2011 Bangladesh and Nigeria celebrate new FIT Grads! Dhaka, Bangladesh ICC Bangladesh and organized a series of seminars in Dhaka and Chittagong Bangladesh on 5 and 7 December 2011 covering the subject of ICC Rules and Tools for International Trade Operations incorporating Legal Cases. The events also incorporated graduation events of the IFC FIT Initiative in Bangladesh which were presided over by Mr. Mahbubur Rahman, President of ICC Bangladesh. The next intakes of the IFC FIT Program will be taking place from 14 February 2012 so contact us at info@ifcfitinitiative.com if you would like to join the course! Project Partners in the IFC FIT Initiative Gratefully acknowledges the participation and contribution provided to the success of this project by the following project participants: The IFC FIT Initiative is an e-learning program that is designed with an important dual purpose: 1. to train and certify international trade finance professionals 2. to build an online global network of international trade and finance professionals who will share knowledge and experience on an online platform specifically developed for the program This Three Month program is delivered in a combination of the following learning elements: Online Support site for students Students will be incorporated into the Alumni and will be able to collaborate through a purpose built learning platform. Online Specialised training in UCP 600 ICC Approved Online Training in UCP 600 (Mentor or Upskill 600). Online Collaboration Site for stakeholders To leverage the network aspect of the 'FIT' Initiative all stakeholders (participants, tutors and coordinators) will have access to an online networking and collaboration system designed to facilitate exchange of ideas and contact building. Online Interactive Core Learning Material The Finance of International Trade (FIT) course is comprised of the following Learning Units: * Methods of Payment * Bills of Exchange * Documentary Collections * Documentary Credits * Import Documentary Credits * Bonds & Guarantees * Forfaiting, Factoring & Invoice Discounting * Structured Trade Finance * Export Credit Agencies * Complex Transactions * Warehouse Financing * GTFP Trade Facilitation Program FIT Initiative Graduation held in Dhaka Bangladesh on 1 August 2010 EBSI EXPORT ACADEMY 14

15 IFC FIT Initiative Lagos, Nigeria ICC Nigeria celebrated the second graduation of Nigerian IFC FIT Graduates on Friday 18 th November 2011 in Lagos where Dr. Christopher Kolade, former Nigerian High Commissioner to the UK as well as Mr. Vincent Olu, former governor of the Central Bank of Nigeria were the Guests of Honour. The event also marked the 80 th anniversary of the ICC Banking Commission globally which was celebrated in 2011 by over 120 countries. Feedback from a cross-section of our graduates has been very positive. Next Intake Dates for the IFC FIT Initiative The next program intakes will take place in the following countries on 24 January 2012 Bangladesh, Ataur Rahman, Bangladesh@ifcfitinitiative.net Pakistan, Umar Farooq, Pakistan@ifcfitinitiative.net Nigeria, Bunmi Funke, Nigeria@ifcfitinitiative.net Vietnam, Martin Nguyen, Vietnam@ifcfitinitiative.net Cambodia, Cambodia@ifcfitinitiative.net East Africa, Kenya@ifcfitinitiative.net For other countries please contact info@ifcfitinitiative.net Nigerian FIT Graduates at 2011 Graduation event in Lagos EBSI EXPORT ACADEMY 15

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17 Expert Commentary International Standard Sanction Practice There are a few issues in the trade finance area that seem impossible to 'crack.' One of these, which is 'hot' right now, is the issue of how to deal with existing sanctions against named persons, companies, commodities, and countries. The sanctions are expressed in various ways; in programs, resolutions, or laws. In order to make the sanctions operational, the so-called sanction lists are made available. These are lists that include the names of the parties, or even ocean vessels, that are sanctioned. The best-known sanctions list is the OFAC SDN list issued by the U.S. Department of Treasury. While this is a U.S. list, similar lists are also issued by international bodies like the European Community or the United Nations Security Council. Banks and other parties are compelled to comply with the sanctions in accordance with the applicable national law or regulation in the jurisdictions in which they operate. Expert Profile Name: Kim Sindberg Position: Technical Trade Finance Adviser and Vice President at Nordea Employer: Nordea Trade Finance Location: Copenhagen, Denmark Specialisation: International Trade Finance Contact: kim.sindberg@nordea.com The issue has been taken up by the ICC in the document 'Guidance Paper on the Use of Sanction Clauses for Trade Related Products (e.g., Letters of Credit, Documentary Collections, and Guarantees). Subject to ICC Rules,1 but a recent query submitted to the ICC Banking Commission reveals that this issue is indeed alive and kicking and by no means resolved. The query is up for discussion at the meeting of the ICC Banking Commission at the end of October Therefore, the text available for the opinion when this article was written is not the final one. Thus this article is not an analysis of Draft Opinion TA752 (as it is numbered) but springs from a statement taken from it. The statement reads: International rules of practice do not address how sanctions should be treated or their consequences under the rules. This is no doubt true, but it is my firm view that the rules should strive to establish some sort of practice. Right now this issue is like 'The Wild West.' There is no common view, and cases where sanctions are called for are handled in an immature way. A sober International Standard Sanction Practice could include the following in my view: A banks obligation under a documentary credit and under sanctions are by nature two different matters. The fact that there are sanctions in force that prohibit a bank from fulfilling its obligation under a documentary credit does not change the fact that such bank is obligated vis-à-vis the UCP 600. If there are sanctions in force the bank may be prohibited to from fulfilling its obligation under the documentary credit. Sanctions are legal requirements; the UCP is a contractual requirement. Legal requirements will always override the contractual requirement. The fact that a documentary credit transaction indicates a person, company, commodity, or country that appears on a sanction list does not in itself mean that an issuing/confirming bank is prohibited from fulfilling its obligation under the documentary credit. A bank should only refuse to honour its obligation under a documentary credit where there are sanctions in force actually prohibiting that bank from honouring its obligation. EBSI EXPORT ACADEMY 17

18 Expert Commentary When a bank refuses to honour its obligation under a documentary credit with reference to sanctions it should provide sufficient proof to the presenter. 1. As a general rule a nominated bank that has acted pursuant to its nomination should be protected, just as is the case where the issuing bank is prevented from paying due to an injunction / stop payment order received from a court. In addition it seems relevant to address the sanction clauses that a number of banks include in their documentary credits. These come in all kind of forms and shapes and (of course) this text is important in the outcome of a case. For Draft Opinion TA752 there is a sanction clause added by the confirming bank that is identical to the one mentioned in the ICC Document regarding sanctions (referred to above), namely, the one found in 3.3: [Abank] complies with the international sanction laws and regulations issued by the United States of America, the European Union, and the United Nations (as well as local laws and regulations applicable to the issuing branch) and in furtherance of those laws and regulations, [A bank] has adopted policies that in some cases go beyond the requirements of applicable laws and regulations. Therefore [the bank] undertakes no obligation to make any payment under, or otherwise to implement, this letter of credit (including but not limited to processing documents or advising the letter of credit), if there is involvement by any person (natural, corporate, or governmental) listed in the USA, EU, UN, or local sanctions lists, or any involvement by or nexus with Cuba, Sudan, Iran, or Myanmar, or any of their governmental agencies.' This is indeed a problematic sanction clause as it indicates that the bank may refuse to pay based on its own 'policies that in some cases go beyond the requirements of applicable laws and regulations.' This means that the beneficiary has a really difficult case, much more difficult than had it merely been a discussion regarding the EU Regulation. Beneficiaries that present documents under a documentary credit with a sanction clause that wide should be aware of the (uncontrollable) potential risk. Put another way, in this case the beneficiary faces a higher risk compared with a documentary credit that does not include a sanction clause, or one that plainly states the regulations that the bank operates subject to, and nothing more than that. This underlines the fact expressed in the ICC document regarding sanctions that: 'A sanction clause should not bring into question the bank s commitment under a transaction to which it relates.' Foundation Certificate in Transport & Logistics Learn the core fundamentals of Transport and Logistics! Online Tutorials Certificate of Completion awarded by Coverage of legal issues Export Packaging requirements Interactive self-paced learning An excellent introduction to this area. Contact us for more details: Export Academy Tel: Fax: Web: info@ebsi.ie EBSI EXPORT ACADEMY 18

19 China Systems Update Beijing China Systems Prize Draw Vincent O Brien, in his role as China Systems Trade Finance Advisor, arranged a Prize Draw for an Apple ipad2 at the ICC Banking Commission Meeting in Beijing from October CS Newsflash Bank of Jiangsu Goes Live with Phase 2of Eximbills Solution World leading trade finance solutions vendor China Systems announced that Bank of Jiangsu has gone live with the second phase of their implementation of Eximbills Enterprise, China Systems' core trade finance product. Eximbills Enterprise is an established global standard installed by many international banks to meet their trade services processing requirements. It combines a Rapid Application Development toolkit with a flexible base business model, providing support for Traditional Trade, Open Account, Supply Chain Finance, and Payments operations. The first phase of the project was successfully carried out from October 2008 to November 2009, marking the first independent implementation of the standard version of Eximbills Enterprise in China. As Bank of Jiangsu had just then been formed from a merger of ten city commercial banks a year earlier, completing the first phase of the project within a little over a year was a major achievement that involved the integration of business services and all peripheral systems from three legacy systems. The integration also included the bank's SWIFT Message Management System. Bank of Jiangsu was restructured from a cluster of ten city commercial banks in East China's Jiangsu Province in These ten banks operated in the cities of Wuxi, Suzhou, Changzhou, Zhenjiang, Yancheng, Yangzhou, Nantong, Lianyungang, Huai'an and Xuzhou. Bank of Jiangsu has more than 420 service outlets, covering all prefecture-level cities in Jiangsu and branches in Shanghai and Shenzhen, and will open more branches in developed areas. EBSI EXPORT ACADEMY 19

20 Expert Commentary Viewpoint - Tackling the Challenges of funding SME Exporters in Nigeria It s no surprise that the major challenge for the growth of SME exporters in Nigeria is funding. This funding challenge is aggravated by inadequate infrastructure (good roads and stable power supply in particular), lack of flexible and SME export friendly financial Institutions and the dominance of Asia with large financial muscles in the Nigerian Export business who offer very high prices to commodity merchants and thus increase the cost of procurements of most exportable commodities. Expert Profile Name: Ayemibo Bamidele Position: Trade Development Consultant Employer: 3T Impex Consulting Nigeria Location: Lagos, Nigeria Specialisation: Trade & Finance Contact: bayemibo@gmail.com This article is solution focussed and was therefore put together to give ideas to the federal government and financial institutions both within and outside Nigeria in order to enable them to consider SME exporter s funding as an investment option. I will therefore like to offer the following possible solutions to tackle the challenges of inadequate funding of SME exporters in Nigeria. Government should make laws to encourage the establishment of specialised banks that will only finance export transactions. These laws should allow private individuals to establish export focussed banks and Government should own and contribute 50% of these banks capitalisation so as to have a good control over its operations and thus enable the government to achieve its objectives of growing SME exporters. The law should stipulate the following among other things: 1. The export banks are to finance only export transactions and any financing done outside this should be penalized. 2. The export banks should offer trade finance products like Export Credit guarantee, Export Credit Insurance, Factoring, Forfaiting, Invoice discounting etc. 3. The interest rate on the export financing facilities from this bank should be set by the Central Bank and should be lower than the prevailing rate in the market at any point in time. 4. The export banks should be given tax holiday to enable them to maximize profit. 5. Government should reward any of the export banks that have the highest export finance facility portfolio at the end of each financial year. 6. The export banks should offer both pre and post export financing to exporters. 7. The banks should only finance SME exporting companies or cooperatives with at least 6 month experience in the business and with Bill of lading records of export and evidence of receipt of export proceeds from the buyers abroad. 8. The banks should only finance SME exporting companies that are owned 100% by Nigerians 9. The export bank should have a warehouse where all the products that they are financing are inspected to ascertain the quality before they are exported. 10. The export bank should grant export facility that is as low as 1 Million Naira and as high as 50 Million Naira 11. The goods should be used as collateral for post shipment financing while equity contribution of 30-50% must be a pre-requisite for pre-shipment financing. 12. The export financing facilities from the export bank should cover the export of solid minerals and agricultural commodities, semi-processed products and finished goods. 13. The export bank financing facility should only be granted to export transactions with Letter of Credit that is confirmed by a reputable Bank, Sight Bill for Collection and Avalised Bill of Exchange. If the above proposed solutions can be given a favourable consideration, I believe it will not only boost the growth of SME exporters in Nigeria, it will consequently increase the rate of employment generation, drastic reduction in poverty and significant growth in Nigerian Gross Domestic Product. Ayemibo Bamedele International Trade Certified Training Programmes Programme Intakes every two months from January 23 rd, 2012 Certificate in Logistics Certificate in Finance ITS Accreditation Advanced Certificate in Delivered exclusively by: International Trade & Logistics Export Academy Diploma in Export Operations Certified Course in US Customs Procedures Tel: Fax: Web: info@ebsi.ie EBSI EXPORT ACADEMY 20

21 Advertisement Feature DISCOVER HOW GLOBALTRADE.NET CAN HELP YOUR OVERSEAS OPERATIONS Want to share your expertise to the international trade community and in return gain new business leads from other trade professionals? FITA Online ( makes it possible through its new website Are You an Importer/Exporter? Find informative content and service providers for your international trade operations in GlobalTrade.net s Knowledge Resource. Here international trade professionals can find experts analysis, market surveys, tips, white papers, country profiles, experts views, webinars, news flows, video tutorials, etc. Are You a Service Provider? Feature your expertise by posting content to our Knowledge Resource and listing yourself in our Database of International Trade Service Providers. International trade professionals can select experts such as international marketing consultants, trade finance companies, banks, freight forwarders, quality control firms, lawyers, accountants, customs brokers, instructors, insurance providers for their international operations. is run by FITA Online ( the online services division of the Federation of International Trade Associations (FITA), together with partners U.S. Commercial Service, UK Trade & Investment, ThomasNet, Alibaba and Kompass. Export Academy has teamed up with FITA Online to provide you with special invitations to try out this new website. You will be among the first to try it out. So what are you waiting for? Sign up today! The new website is currently in its soft launch phase that meaning you can only access it by an exclusive invite. Launching in only a matter of weeks, GlobalTrade.net would like to invite all TradeBrief subscribers to create a profile today, post informative content and gain new business leads for FREE. Creating a profile and posting content is free. Being listed in the Database of International Trade Service Providers is free until June Simply log in with the ID and Key below to start getting new business today! ID: KEY: 1234 *** FITA Online offers diverse online services to the worldwide international trade community. Its services include the websites and as well as International Trade Information Platforms for Banks, online international trade information systems for government economic development agencies and customized international trade marketplaces. Explore GlobalTrade.net for FREE at EBSI EXPORT ACADEMY 21

22 Expert Commentary EU Competition What are the Rules? This article is directed at UK organisations but also seeks to provide a European flavour for the broader readership. It is not legal advice but rather our concise interpretation of the rules, which we hope will draw attention to them or act as aide memoire. We commence with an overview of the legislation, highlight some consequences, indicate what to watch out for before concluding with some actions an organisation might take to mitigate risk. In the UK there are two sets of competition rules that apply in parallel: (1) Anti-competitive behaviour within the UK is prohibited by Chapters I & II of the Competition Act 1998 & the Enterprise Act Expert Profile Name: Gavin Makowski Position: Supply Chain Manager Employer: Dishman European Operations Location: London, United Kingdom Specialisation: Supply Chain Management Contact: gavinmak@hotmail.co.uk (2) EU-member states are covered under Articles 101 & 102 of the Treaty on the Functioning of the European Union (TFEU) Failure to comply with either UK or EU competition law can have very serious consequences: Fines of up to 10% of global group turnover Third party action e.g. customers, competitors, consumers (if they can show they have suffered loss) Conduct can be stopped by court injunction Director disqualification (& criminal sanctions for significant breaches) Whole agreements or provisions within them may become void & unenforceable Individuals prosecuted for a cartel could face up to five years imprisonment and/or unlimited fines Major disruption & damage to a company's reputation Expert Profile Name: Adeline Michau Position: Customer Services Manager Employer: Dishman Europe Ltd Location: London, UK Specialisation: Supply Chain Management The two main types of anti-competitive activity include (a) Anti-competitive agreements (under the Chapter I and Article 101 prohibitions), and (b) Abuse of dominant market position (under the Chapter II / Article 102 prohibitions). Each will be discussed below. (a) Anti-competitive agreements (Chapter I / Article 101) One should not make agreements, arrangements or partake in concerted business practices that prevent or intend to restrict or distort competition. In addition to the wording and form of a written agreement, anticompetitiveness may be assessed on an organisation s objectives, conduct and other suspicious activities. Verbal & informal 'gentleman's agreements' are also capable of being found to be anti-competitive. One should be wary of agreements that:- 1. Directly or indirectly fix purchase or selling prices or other trading conditions (e.g. discounts or rebates) 2. Limit or control production, markets, technical development or investment (e.g. setting quotas or levels of output) 3. Share markets or sources of supply 4. Apply dissimilar conditions to similar transactions, placing other trading parties at a disadvantage. The most serious behaviour are cartels which involve price fixing, market sharing, bid rigging, or limiting the supply or production of goods and services. Exemptions An agreement restrictive of competition which seemingly falls within the prohibitions may still be exempted. For instance, parties market shares might be sufficiently low that there is no real consequence on trade and are considered harmless. EBSI EXPORT ACADEMY 22

23 Expert Commentary Alternatively, an agreement may have a real effect on trade but might fall under a 'block exemption'. A block exemption is a group exemption that automatically exempts agreements falling within its terms e.g. certain criteria relating to market share or a particular type of restriction. Different block exemptions may apply depending upon the nature of the agreement or the market sector concerned. An example is the EU liner shipping exemption which allowed lines to collude on prices and services for the better good of the EU economy, although this was repealed in Furthermore, if an agreement does not fit squarely within a block exemption, it may still not automatically be unlawful or unenforceable; an agreement may be individually exempted on the grounds that its restrictions of competition are outweighed by its beneficial effects. For instance, two pharmaceutical companies to developing a new drug are likely to be subject to the Chapter I or Article 101 prohibition, because working together may be seen to be reducing the number of products being produced and preventing each from working on independent ventures. Yet the benefits for consumers resulting from such co-operation e.g. more investment leading to better drugs with faster market entry, may be considered sufficient to off-set any anti-competitive effects. (b) Abuse of a dominant market position (Chapter II / Article 102 prohibition) Organisations owning significant market share are prohibited from unfairly exploiting their strong market positions. A position of dominance means that the business has the ability to act independently of its customers, competitors & consumers. This is a complex assessment of a number of elements but, as a general rule, if a business has a 50% market share there is a presumption that it is dominant. Then again dominance has been found to exist where market share is as low as 40%. Dominance must be in a substantial part of the EU (Article 102) but no minimum requirement exists in the UK (Chapter II), meaning that (in theory at least) dominance could be considered to exist in a fairly small area of the UK. Having a dominant position does not in itself breach competition law: it is the abuse of that position that is prohibited. Examples of behaviour that could amount to abuse include: 1. Imposing unfair trading terms, such as exclusivity 2. Excessive, predatory or discriminatory pricing 3. Refusal to supply or provide access to essential facilities 4. Tying (e.g. stipulating that to buy one product a buyer must buy another) Exemptions Unlike 'anti-competitive agreements' a compensating benefit of actions will not exonerate an organisation s conduct. Although a dominant company may be able to show, in certain circumstances, that it has objective justification for otherwise abusive behaviour. For example, a company may refuse to supply a particular customer based upon its poor credit rating and this is protecting its legitimate business interests so long as such behaviour does not go beyond this. International Factors Brief Mergers and Acquisitions are an important characteristic of global trade. As more jurisdictions become more deeply involved in merger and competition reviews, the risk of divergence between rules increases. Rising trade activity with Chindia is impacted by a hange in Chinese anti-monopoly law as well as revised laws in India: these may thwart prolific cross border mergers and acquisitions. In 2009 China s Ministry of Commerce prohibited Coca Cola s $2.4 billion takeover over Huiyuan Juice resulting in sweeping concern of protectionist tendencies. Even EU rules can impact upon international companies doing business or trading here, regardless of whether they are established within the EU. Extraterritorial application of different competition rules could also apply - certain conduct could feasibly be evaluated under EU Competition laws and US antitrust laws in addition to those of the country in which conduct occurs. EBSI EXPORT ACADEMY 23

24 Expert Commentary Company Action In general, organisations having a monopoly/dominant position are held to a higher standard of conduct than smaller firms. In view of the risk of severe consequences, organisations should promote understanding amongst their employees and provide guidance as to what type of behaviour is and is not permissible under the law(s). An organisation may firstly publish an overarching written policy documenting its aims to prevent violation of any applicable competition law with respect to its activities. This should declare how they will not take actions that could prevent, restrict or distort competition in breach of any applicable competition laws, most specifically the UK Competition Act 1998, the Enterprise Act 2002 and Articles 101 and 102 of the Treaty on the Functioning of the European Union. To provide the appropriate level of gravitas the policy could be endorsed by the Owner/CEO and the following implementation actions enforced by the legal or another authoritative department. Enforcement should follow clear and demonstrable written procedures and actions, such as prompting employees to remain vigilant and exercise care during all of their activities, particularly commercial communications, whether these are trade fair interactions or during ongoing business relations. They shall bear in mind that actions could lead to future as well as immediate competition infringements, and that particular care should be taken when entering verbal or written agreements when the organisation is in a strong market position, or where they may be communicating with present or possible future competitors and exchanging information such as pricing or terms of business, or setting standards that exclude competitors. Examples of inherently harmful conduct and guidance relating to these should be provided. The organisation may also consider encouraging related parties, not wholly owned or managed by the organisation, to adopt its own policies, or at least not operate in conflict of them. To avoid overwhelming employees the organisation may confine its training and guidance to its individual activities. A training balance should be struck basic, yet consistently enforced. De Beers provides over 1700 of their staff with an online competition law compliance programme, while others ask employees to undertake computer based training on an annual basis, thereby providing regular update and a refresher to old and new staff. Training and guidance resources should be routinely reviewed and updated. This is particularly important if a large strategic change such as mergers or acquisitions has repositioned the organisation within the Competition framework. Finally, regardless of whether laws apply, the organisation may decide to install certain policies and actions as part of its voluntary ethical drive or corporate social responsibility (CSR) framework. US Customs Broker Exam Prep Course Learn the key aspects of US Customs and launch a career as a US Customs Expert! Online Tutorials Certificate of Completion awarded by Coverage of legal issues US Security requirements Self-paced learning An excellent introduction to this area. Practice Exams with Tutor Feedback Optional Discussion Forum Support Available Contact us for more details: Export Academy Tel: Fax: Web: info@ebsi.ie EBSI EXPORT ACADEMY 24

25 Recent Events Demand for experts to deliver seminars and attend conferences around the world has grown dramatically despite financial crisis. Here is a brief overview of some of our more notable appearances since last issue! Skopje, Macedonia Vincent O Brien has been delivering during 2011 a series of Seminars on Trade Debt Restructuring in the context of the Global Financial Crisis. On 21/22 September the tour of seminars moved to the Balkans for a seminar in Skopje, Macedonia for EBRD Issuing Banks. Belgrade, Serbia The second Balkans workshop for the EBRD Trade Debt Restructuring program was in Belgrade, Serbia. The workshop took place on 26/27 September Vincent O Brien with Serbian participants in Belgrade. Zagreb, Croatia ICC Croatia invited Vincent O Brien to deliver a workshop in Zagreb on the new Incoterms 2010 rules from ICC in Paris. The seminar included interventions from Prof. Marina Dabic who presented the local perspectives and practices in Croatia. The seminar took place in 29 September Vincent O Brien Participants at the seminar in Zagreb. EBSI EXPORT ACADEMY 25

26 Recent Events Sofia, Bulgaria Mr. Pavel Andrle, Senior Consultant for and secretary to the Banking Commission of ICC Czech Republic, was invited by the ICC National Committee in Bulgaria to deliver a 2 days seminar on Incoterms and banking practice, risk assessment, problem issues from banking and trade companies perspective, 4 October 2011, Sofia, Bulgaria Pavel Andrle & participants following the highly anticipated Incoterms 2010 event. Istanbul, Turkey EBRD organised a major international forum as featured in this issue on 5-7 October 2011 to update issuing and confirming banks on the status of various regions of the EBRD s countries of operations of developments following the Global Financial Crisis.. Thomas Smith with other EBRD Trade Finance Forum participants and organisers. Ulaanbaatar, Mongolia The next leg of Mr. O Brien s Tour of EBRD Trade Debt Restructuring Seminars was delivered in Ulaanbaatar, Mongolia on October Vincent O Brien with Participants in Ulaanbaatar. EBSI EXPORT ACADEMY 26

27 Recent Events Katmandu, Nepal Pavel Andrle was invited to deliver a 2 days seminar Incoterms 2010 and Documentary Payment instruments, ICC Rules for Documentary Credits - UCP 600 & Demand Guarantees URDG 758 seminar on October, 2011 in Kathmandu, Nepal Participants from Katmandu with Pavel Andrle at the seminar. Paris, France The International Chamber of Commerce HQ in Paris France invited Vincent O Brien to deliver a seminar on Incoterms 2010 rules and their impact on Documentary Credits on 21 October 2011 Vincent O Brienduring the delivery of his Incoterms 2010 seminar in Paris. Manila, Philippines Pavel Andrle was invited by CACCI in Manila to deliver a 2 days seminar on Introduction of Bank Guarantees and Standby Letters of Credit; Typical Cycle, Main types of Guarantees; Standby Letters of Credit according to UCP 600 & ISP 98;The new URDG 758 Rules for independent bank guarantees on the October 2011 in Manila, Philippines. Pavel Andrle with Participants at the Manila Seminar. EBSI EXPORT ACADEMY 27

28 Recent Events Beijing, China China Minsheng Banking Corporation took advantage of the presence of two of the worlds top trade finance trainers to organise a staff training for their trade finance department in Beijing just after the ICC Banking Commission meeting on 29 October Vincent O Brien teamed up with Chee Seng Soh from Singapore to deliver the training. Chee Seng Soh, Vincent O Brien & Li YongHong general manager of bills center of trade finance department of CMBCwith CMBC Staff Members. Manilla, Philippines The Asian Development Bank following the previous year s highly successful in house training in their headquarters in Manila followed on with an advanced case study based seminar on trade finance for their staff on 3-4 November Vincent O Brien with ADB participants in Manila. Dubai, United Arab Emirates Dubai Chamber of Commerce organised a training seminar on Incoterms 2010 delivered by Vincent O Brien on 24 November Vincent O Brien with participants in Dubai Chamber of Commerce. EBSI EXPORT ACADEMY 28

29 Recent Events Kiev, Ukraine The next location scheduled for the EBRD tour of seminars on the topic of Trade Debt Restructuring was for Kiev in Ukraine on 10 and 11 October Vincent O Brien with Ukrainian participants at the EBRD Trade Debt Restructuring workshop. Moscow, Russia The EBRD Series of workshops on the Trade Debt Restructuring continued with two seminars in Russia. The first seminar in Moscow was held on 17/18 November Vincent O Brien with participants in Moscow. Yekaterinburg, Russia The growing importance of Regional banks in Russia was reflected by the organising of a second seminar in Russia of the EBRD series of workshops on the Trade Debt Restructuring in Yekaterinburg, Central Russia on 21 and 22 November Vincent O Brien with attendees of the final EBRD Trade Restructuring Seminar in Yekaterinburg. EBSI EXPORT ACADEMY 29

30 Recent Events Jakarta, Indonesia Vincent O Brien was invited to deliver a seminar in Jakarta, Indonesia with a regular contributor of TradeBrief, Soh Chee Seng. The seminar was focused on Incoterms 2010 and Documentary Credits and took place on 26 November Vincent O Brien with participants in Jakarta, Indonesia. Dhaka, Bangladesh ICC Bangladesh and celebrated the fourth Graduation of students from the highly Successful IFC Finance of International Trade Program on 5 December 2011 with Seminars in Dhaka and Chittagong. As usual for the very progressive nation of Bangladesh the uptake of the highly innovative IFC FIT Program was the highest of all the countries participating, which is a testament to the organisation of the ICC Bangladesh National Committee. Well done! Vincent O Brien and graduates of the IFC FIT Program. Chittagong, Bangladesh The second seminar in Bangladesh was in Chittagong on 7 th December and also enjoyed a graduation event on 7 December Vincent O Brien is thanked by Graduates of the IFC FIT Program in Chittagong. EBSI EXPORT ACADEMY 30

31 Recent Events Doha, Qatar delivered an Incoterms 2010 booster workshop as part of an ongoing learning program with Commercial Bank of Qatar which covered the key aspects of Trade Finance. The seminar was held in Doha on 13 December 2011 Vincent O Brien with participants at the CBQ Incoterms Seminar. Dubai, United Arab Emirates Vincent O Brien presented certificates to graduates from Commercial Bank of Dubai corporate elearning program on 14 December at their headquarters in Dubai. Vincent O Brien with participants of the corporate elearning programme with CBD. Are You a National of an Emerging Market? Do you qualify for the Emerging Market Grant Scheme (EMGS)? If you said YES to these two questions you may apply for and be eligible to up to 60% grant financial support toward the cost of the certified programmes listed in this advertisement! Certificate in Finance International Trade Specialist Accreditation Diploma in Export Operations Contact us for more details: The electronic Business School International Tel: Fax: Web: info@ebsi.ie EBSI EXPORT ACADEMY 31

32 Upcoming Events Global Trade Review The world s leading international trade finance and export finance magazine. 9th Annual Middle East Trade & Export Finance Conference February 14-15, 2012 Dubai UAE 8 th Annual India Trade & Export Finance Conference February 23, 2012 Mumbai, India 6th Annual Africa Trade & Export Finance Conference March 8-9, 2012 Cape Town, South Africa 6 th Annual Turkey Trade & Export Finance Conference March 22-23, 2012 Istanbul, Turkey emeafinance The complete information source for the finance industry in the EMEA region. Upcoming Events: Worldwide: Intakes for elearning programs 30 January 2012 & 30 March 2012 Country Specific: Ulaanbaatar, Mongolia EBRD Training 2-3 February 2012 Moscow, Russia Exporta Trade & Export Finance 7 February 2012 Dubai, UAE 9 th Annual Middle East Trade & Export Finance February 2012 Mumbai, India India Trade & Export Finance Conference 23 February 2012 New Delhi, Chnnai & Mumbai, India ICC India Incoterms 27 & 29 February, 2 March 2012 Vienna Austria ICC Seminar on Incoterms March 2012 Cape Town, South Africa Africa Trade & Export Finance 8-9 March 2012 Istanbul, Turkey- Turkey Trade & Export Finance March 2012 Doha, Qatar ICC Banking Commission Meeting March 2012 If you would like information on any of these events please events@ebsi.ie and we will send you the relevant details. Congratulations! We would like to Congratulate the winner of the China Systems Prize draw IPAD 2 compliments of China Systems Corporation. The prize was presented at the ICC Banking Commission Trade Finance Summit in Beijing on Friday 28 October To subscribe to this ezine simply go to and we will add you to our subscriber list and add an entry to the draw for a free scholarship for our International Trade Specialist Accreditation worth EUR 2000! also provided compliments of China Systems Corporation. Certificate in Logistics Learn all you need to know about Transport and Logistics! Online Tutorials Certified by the Chartered Institute of Logistics & Transport Includes Section on Logistics Customer Service Recognised Internationally Interactive self-paced learning 3 Written Assignments and 1 Online Exam Contact us for more details: The electronic Business School International Tel: Fax: Web: info@ebsi.ie EBSI EXPORT ACADEMY 32