Following the announcement of the UK to legislate electronic trade document transfer, long-time trade rival and erstwhile EU partner France is now looking to digitalize international trade documentation, and trade finance operations.
Recognizing the fact that digitization of international trade could play a critical role in making French companies internationally competitive, the Government of France is encouraging importers, exporters, and their financers to move towards the digitization of international trade finance procedures.
In line with this, the French Government has announced the launch of a programme dedicated to the digitization of international trade finance procedures, to be assigned to the Paris Europlace working group, which already focuses on this topic and is made up of ICC France and various representatives of the international trade finance sector.
Announcing the initiative, Bruno Le Maire, Minister of the Economy, Finance and Industrial and Digital Sovereignty said “The digitization of international trade finance procedures could be a major driver of simplification, which would benefit the competitiveness of our businesses, and in particular our SMEs. It will also make the Paris marketplace a global trade finance hub.”
As per the press release, this digitization would be consistent with the initiatives recently undertaken at the UN1 and the G72 to promote paperless procedures and the use of transferable electronic documents in this sector.
Earlier in the year, released a White Paper on the challenges and opportunities offered by the digitization of international trade in which the French committee of the International Chamber of Commerce estimated that only 1% of the 4 billion trade documents issued each year in international trade finance were digital and despite significant efforts to digitize the financial sector, trade finance continues to be carried out mostly through paper documentation.
The programme is also tasked with
- evaluating stakeholders’ needs in terms of digital technology, and
- identify the necessary changes, particularly as regards legal and technological changes
- putting forward proposals that would strengthen the attractiveness of the Paris marketplace with regard to international trade finance activities.
The conclusions and recommendations of this programme will be drawn up in a final report which is expected to be submitted to the Government in March 2023.
Éric Dupond-Moretti, Keeper of the Seals, Minister of Justice who forms part of the launch said “Law is a tool to be used to follow the major economic shifts linked to digital technology and more generally to strengthen the attractiveness of the Paris marketplace.
The programme assigned to the Paris Europlace working group will be significant in evaluating the opportunity to modify the legal texts governing international trade activities, consistent with the recommendations made by the UN Model Law.”
Olivier Becht, Minister Delegate for Foreign Trade, Economic Attractiveness, and French Nationals Abroad, co-lead in this initiative said “Digitization is key to modernizing exports and reducing transaction costs. It is an essential driver for our businesses, especially SMEs and intermediate-sized enterprises, in the international arena. That is why I want to support this digitization, which will benefit our businesses.”
If the programme progresses as planned and France also adopts the MLETR, it will be a major boost to efforts to digitalize international trade and will make France the first EU country to adopt this legislation.
Other countries that have currently adopted MLETR are Bahrain (2018), Belize, Kiribati, Paraguay, Singapore, Abu Dhabi Global Market (2021), and Papua New Guinea (2022) with the UK’s bill currently with the House of Lords.