24 November 2020 (London/Dublin) – Renowned trade finance institutions including BNP Paribas, Commerzbank, Intesa Sanpaolo, İşbank, LBBW, Raiffeisen Bank International AG, S-Servicepartner, SMBC, and TradeIX together with international law firm Sullivan & Worcester, and facilitated by the International Trade & Forfaiting Association (ITFA), designed and released the first rulebook for MarcoPolo’s Payment Commitment solution.
The new trade finance instrument, Irrevocable Payment Commitment (IPC) introduced earlier this year and offered by the Marco Polo Network, secures payments against the successful matching of digital trade data.
The Marco Polo Rulebook for Payment Commitment provides a legal framework for the creation of Irrevocable Payment Commitments using the Marco Polo Payment Commitment Module. An IPC relates to an Underlying Trade Transaction with respect to which participants have agreed to engage in an IPC transaction pursuant to an IPC program.
The rulebook applies to the utilization of the Marco Polo Payment Commitment Module within the Marco Polo Business Network. The rulebook is binding on each participant that has accepted it by subscribing to the Marco Polo Network and the Payment Commitment Module.
The completion of the Marco Polo Rulebook for the Payment Commitment Module represents not only an important milestone for the network and its members but also an opportunity to build on existing trade disciplines and global standards in order to fully realize the benefits of digitalization and paperless trade.
The members of the Marco Polo Network expect that the rulebook together with the technology solution will grant corporate clients access to wider ecosystems in trade finance and working capital solutions.
Dani Cotti, Managing Director, Centre of Excellence, Banking & Trade at TradeIX
“We came together with the various Marco Polo members to lay the foundation of the legal framework. This exemplifies the unique principles within the Marco Polo Network rooted in collaboration and in collective innovation. We welcome new members and partners to join the Marco Polo Network as we continue our quest to transform the trade landscape and build upon this important milestone in the digitalization of trade.”
Angela Koll, VP, Senior Business Expert at Commerzbank AG, Co-Chair of the Marco Polo Rulebook Working Group
“I am very pleased about the fruitful discussions we had in the working group to create the legal framework for the Marco Polo Payment Commitment. The rulebook is leaning on existing rules for trade finance, ongoing discussions to support digitalisation in trade finance and tailored to the practical needs of a new digital instrument to secure payments and provide finance. With Geoffrey Wynne and his team we had excellent legal consultants to support our work and also building a bridge between Marco Polo and the ICC.”
Med Ridha Ben Naceur, Program Lead Marco Polo, International Business at LBBW
“At LBBW, we aim to guarantee our customers the greatest possible legal security, even when using innovative technologies. This is reliably guaranteed by the rulebook so that our customers can finally use the time and cost-saving trade finance solutions of the Marco Polo Network.”
Martina Zimmerl, Head of Trade Finance, at Raiffeisen Bank International AG
“The development of the first version of the Payment Commitment Rulebook is a milestone jointly achieved by the Marco Polo Banks, TradeIX and Sullivan & Worcester. Now, the legal environment has been created to ensure that processes, rights and obligations of all parties to the Payment Commitment are clearly described and enforceable in accordance with the terms of the rulebook. Raiffeisen Bank International AG is glad to have contributed to this joint effort.”
Shinichiro Yamazaki, Global Head of Trade Innovation, Global Trade Finance Dept at SMBC
“The ability to finance trade will define our recovery from the current pandemic. The need to build networks and bring together market participants by creating efficient and accessible environments is more important than ever if we are to ensure the necessary evolution of the trade finance market. This rulebook and this product is an indispensable step in that evolution and I am pleased that this project, through the involvement of so many devoted individuals and institutions, has shown the collaborative spirit that energises the move towards greater adoption of technology which will ultimately benefit us all.”
Geoffrey Wynne, Head of the London Office of Sullivan and its Trade and Finance Practice at Sullivan & Worcester
“We were approached by ITFA and TradeIX based on our previous work with irrevocable payment undertakings to create the legal basis for this concept to be called the irrevocable payment commitment (IPC) to work on the Marco Polo Platform. We were very pleased to have the discussions and for the rulebook to have been created to achieve the mechanics for the use of the IPC. This is another example of how to move forward with digital trade transactions and we were very pleased to have been part of the team”.
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