The Model Law on Electronic Transferable Records (MLETR) by UNCITRAL aims to enable the legal use of electronic transferable records that are functionally equivalent to transferable documents or instruments.. Transferable documents or instruments typically include bills of lading, bills of exchange, promissory notes and warehouse receipts..
Since the adoption of MLETR on 13th July 2017, only 6 states and 7 jurisdictions, have adopted this model as legislation and incorporated it into their country’s law..
Singapore became the second country to adopt this model in February 2021, when they passed The Electronic Transactions (Amendment) Bill in Parliament, to amend the Electronic Transactions Act (ETA), and make consequential and related amendments to the Bills of Lading Act and the Contracts (Rights of Third Parties) Act..
This adoption by Singapore has enabled the first ever electronic Bill of Lading (eB/L) transaction governed by Singapore law issued in accordance with the Singapore Electronic Transactions Act..
This milestone was achieved on a container shipment carrying Nickel Matte (an intermediate product in the metallurgical processes with a nickel content varying between 30-60%) from Australia to China carried by ONE, the 7th largest container shipping line in the world..
The transaction is reported to have have been done between BHP of Australia and Jinchuan Group, under a letter of credit (LC) with National Australia Bank (Hong Kong branch) acting as advising bank on behalf of BHP and a leading Chinese trade finance bank acting as issuing bank on behalf of Jinchuan Group..
Announcing this transaction, essDOCS, the eB/L solution provider wrote that the end-to-end documentation process was completed electronically in under 48 hours, compared to days (or even weeks) required in a traditional, paper-based transaction with 100% of documents required under the LC presented electronically..
This milestone is yet another step closer in the realisation of digitalisation of trade documents and another step towards its widespread adoption..
If other countries, customers, banks and other stakeholders were waiting to see who would do it first, this would be it.. How far are you, UK..??
