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advising that the electronic methodology will be a contractual requirement. However, transferring to a completely electronic system is going to be complex; in certain jurisdictions only paper documents are accepted, which will actually require changes in the law. In fact, in the UK, the eBL has no legal status.
There is a Bill currently moving through Parliament to facilitate eBLs and other
e-documents of trade which was considered in the House of Lords in November 2022. The draft bill resulted from The Law Commission’s recommendations on electronic trade documents made in March 2022. The Law Commission’s recommendations were: 1. Only one person should be permitted to exercise control over any e-document at any one time; 2. Once transferred, the transferor should no longer have control over the e-document; 3. The system of use must be reliable to manage those e-documents meeting the necessary criteria. One further recommendation was made, being that there should be a list of factors to be taken account of when assessing the reliability of the system of use. The expected benefits are efficiency and economy in operating costs, increased security and compliance, environmental benefits, and to maintain English law’s leading role in global transaction governance. Business benefits Lord Parkinson, in the House of Lords, giving the lead comments announced that the Bill is permissive and facilitative and only seven clauses in length. He referred to figures in support saying that UK trade is worth £1.4 trillion, and this Bill should provide benefits to UK businesses over the next 10 years of £1.1 billion. Such changes, if and when they are fully implemented, will need a considerable re- engineering of forwarding processes. Also, there is the possibility of a dual approach, with some key documents moving through an electronic pathway, whilst paper documents are still required for Customs clearance, etc. Undoubtedly change is coming. The UK government is looking at implementing a single trade window that would allow digital messaging to replace paper documents. This would be a step in the correct direction, but particular questions regarding costs, the methods available to submit data and what shipping lines will do with the data are still causing concern.
The UK government is looking at implementing a single trade window that would allow digital messaging. While this is welcome, there are several areas of concern The introduction of electronic Bills of Lading
Members will probably have noted various reports in the trade press advising of significant initiatives to extend digitalisation within the container trade. There has been progress in implementing similar programmes in air and there are plans to do so in roadfreight via the eCMR. FIATA is digitalising its Forwarders Bill of Lading, transforming it into an eFBL – more information is available at www.efbl.fiata.org/ . There is a clear direction of travel in trade documentation but, as a whole, the sector has been remarkably resistant to change. The paper bill of lading, depending on who you read, has certainly been in existence since the 17th century. Bills of lading have evolved over the centuries, with the three main functions of a traditional negotiable bill of lading today being: • Evidence of a contract of carriage, • Proof that the carrier has received the goods, • Document of title to the goods. The Express Bill of Lading is a type of bill of lading in which the carrier is obligated to deliver the goods to the named consignee with no
original bills of lading re-issued. Estimates indicate that approximately 45 million bills of lading are issued by carriers each year, of which 1.2% are electronic. In February this year, the nine members of the Digital Container Shipping Association (DCSA), a neutral, non-profit organisation founded by major ocean carriers to digitise and standardise the container industry, committed to converting 50% of original bills of lading to digital within the next five years and 100% by 2030. Cost savings The press release highlighted that the adoption of the electronic Bill of Lading (eBL) would save $6.5 billion in direct costs for stakeholders and enable $30 to $40 billion in annual global trade growth. The problem with this announcement is, who will be the main beneficiaries of this significant change? Forwarders remember similar pronouncements from IATA in the air environment, where the perception was that most of the cost savings accrued to the carrier and very little to the forwarder. In some jurisdictions carriers are already contacting shippers and/or freight forwarders
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April 2023
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