The UK will introduce legislation that gives legality to digital documents on the blockchain
The British Parliament has introduced a new bill that gives legal status to paperless documentation used in international trade. The Electronic Trade Documents Bill seeks to encourage the adoption of digital documents similar to electronic bills of lading and digital cargo insurance certificates.
Most of these digital certificates are based on blockchain technology, with platforms such as Contour and Komgo leading the way. Other platforms looking to use blockchain in trade finance include GSBN, CargoX and TradeLens, a platform jointly developed by IBM and Maersk.
The proposed legislation aims to reduce administrative costs and red tape associated with paperwork. The submitted regulations will also modernize the Bills of Exchange Act of 1882 and the Goods Transport Act of 1992, which will usher in a number of benefits for stakeholders in the field.
Right out of the gate, experts say digitizing trade documents could save the UK nearly $1 billion over 10 years and cut processing times from two weeks to just 20 seconds. Furthermore, the Digital Container Shipping Association predicts that using electronic invoices for shipping will save a staggering $4 billion globally if half of the shipping industry embraces digitization.
“Our digital-first plans will make it easier for the nation’s firms to buy and sell around the world – driving growth, supercharging our economy, cutting carbon and boosting productivity,” Digital Secretary Michelle Donelan said. “Britain was central to the establishment of the international trading system in the nineteenth century, and we are again leading the world in increasing global trade in the twenty-first century.”
The bill was read in the House of Lords five times and will make its way to the House of Commons for another round of parliamentary hearings. The latest proposed regulation was developed by the country’s Law Commission and stemmed from the Group of Seven commitment to promote increased digitization in the country.
The British tango with digital assets
The UK has undergone a transparent relationship with virtual currencies in recent years, marked by the unceremonious exit of Binance from the country and the crackdown on ads by digital asset service providers from its advertising regulator.
However, there appears to be a ray of light at the end of the tunnel with the Queen’s speech to Parliament in May. The content of the address, while offering a soft landing for service providers, also gave broad powers to regulators to rein in the industry and prevent abuse of the asset class.
“A bill will be brought forward to further strengthen powers to tackle illicit finance, reduce financial crime and help businesses grow,” the speech said. “Measures will be introduced to support the security services and help them protect the UK.”
While the digital asset enthusiast may proceed with trepidation, blockchain supporters can rest easy knowing they have the full support of regulators.
See: BSV Global Blockchain Convention presentation, Elas: Creating private permissioned ledgers on the public blockchain
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