The Electronic Trade Documents Bill, submitted to the House of Lords last October and updated on the 12th July 2023, is now in the final stage before the Royal Assent and is expected to come into force in the Autumn of this year.
The bill will significantly ease the regulatory and bureaucratic burdens on businesses by allowing the legal recognition of electronic trade documents, reducing admin costs and making it easier for British firms to buy and sell internationally.
The commonly used documents in the UK for the trade in or transport of goods which the Bill will enable to become electronic include:
a bill of exchange
a promissory note
a bill of lading
a ship’s delivery order
a warehouse receipts
a mate’s receipt
a marine insurance policy
a cargo insurance certificate
The Digital Container Shipping Association has estimated that 16 million original bills of landing were issued by ocean carriers in 2020, and that more than 99% of those were in paper form. Hundreds of pages of documents previously required to be produced in physical format could now be exchanged digitally, more quickly and more securely.
Paul Scully, Parliamentary Under Secretary of State (Department for Science, Innovation and Technology, stated: "The Bill has global transformational potential. It will place the UK at the forefront of international trade as a thought leader for others to follow and will save businesses an estimated £1.1 billion over the next 10 years."
Update as of 20th July 2023
Following agreement by both Houses on the Electronic Trade Documents Bill 2023 was granted Royal Assent on 20 July 2023. The bill is now an Act of Parliament (law), which is the final step in the UK’s objective to digitalise Trade Documents..
With English law being followed by many countries around the world for international trade and shipping activities, the passing of this bill makes it easier for countries using this law and following the trade digitalisation agenda to possibly follow suit although it is not a requirement.
Chris Southworth, Secretary General, ICC UK said 'I'm sure I can't be the only one still computing what has happened this week. It's a game changer on an epic scale. We haven't just changed English law. From late September when the Act comes into force, we will have enabled 80% of bills of lading, 60% of global trade finance, the lion share of marine insurance and shipping as well as every company in the world which uses English law to now begin removing paper and digitalise trade transactions. The law will also unlock the first east-west #G20 trade corridor to go #paperless with Singapore and the first #G7 trade corridor to do the same with Germany'
A huge step forward for the UK who is one of the leading nations in the digitalisation of trade!
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