Practice update: Technology project

Consortium delivers world’s first cross-border quantum-secure digital trade transaction.

The project:

The 21st century is characterised by unprecedented technological advancements and interconnectedness, which have transformed the way people live, as well as the global economy, international trade and supply chains. These advancements have the potential to unlock the flow of value at a global scale, but as the digital age continues to progress, the need for the law to adapt remains paramount in ensuring that our existing lives and modes of value transfer are not unnecessarily disrupted; instead seamlessly improved.

In this case, the overlap of Law and Technology requires replicating existing paper based systems with digital ones. This is harder than it sounds – for example, can we replace a paper based currency with a digital one (cryptocurrency)? As it turns out, not easily; and that is because of the medium – the law recognises paper as a tangible asset that can be “possessed”, whereas it does not recognise its digital equivalent in the same way. Put more simply, the law recognises that only one person can posses the same £5 note at any one time, and that the note gives the owner the right to claim its performance – “I promise to pay the bearer the sum of five pounds“. In this case £5 of value can be transferred by the bearer using the note. Whereas, currently the law of England and Wales does not recognise cryptocurrency in the same way (if at all). That is not to say parties cannot exchange cryptocurrency – they do; impliedly under private agreements. Instead, the law does not recognise cryptocurrency in the same way as fiat currency and therefore flows are (perhaps rightly) stymied – particularly as regards international trade.

Typically, the exchange of value in trade is conducted using physical documents whose functionality depends, as a matter of law or commercial practice, on their being “possessed”. This is because the right to claim performance of the obligation recorded in the document (such as the right to claim payment of a sum of money, or delivery of goods) pertains to the person in possession of the document. The right is embodied in the document, and can be transferred by the (physical) transfer of possession of the document [1]. Enter, Electronic Trade Documents, and the question arises – can they be uniquely possessed and subject to rivalrous transfer ?

In September 2020, the Department for Digital, Culture, Media and Sport (#DCMS) asked the Law Commission to make recommendations to solve the problems caused by the law’s approach to the “possession” and transfer of electronic documents. DCMS also asked the Law Commission to prepare draft legislation to implement those recommendations.[1]

In response, the UK’s Electronic Trade Document Bill (#ETDB) proposes legislation that will allow Bills of Lading, to be used in electronic form, as an Electronic Trade Document (#ETD). To qualify as an ETD it must be protected against unauthorised interference or alteration; be susceptible to exclusive control; be divestible; be capable of being possessed.

AG MIDGLEY LTD under the stewardship of the ICC United Kingdom successfully set up and chaired the Consortium to deliver a pioneering pilot project to deliver a live shipment and shadow digital transaction to test the efficacy of the ETDB prior to its enactment in Autumn 2023. DLT4 comprises specialists in #cybersecurity, #iottechnology and #nfts within the following organisations respectively: ARQIT, Imperial College, and DNA, with #legal guidance and advice being provided by energy and transport law firm Watson Farley & Williams LLP in London and Singapore in association with Wong Tan & Molly Lim LLC.

This landmark transaction was made possible following the signing of a Digital Economy Agreement (DEA) between the #uk and #singapore in 2022, with the ambition to facilitate cheaper #trade through the adoption of digital trading systems between two of the most advanced digital trading nations, which followed on from the 2021 Memorandum of Understanding on Digital Trade Facilitation.

The pilot project tested the hypothesis that to qualify as an ETD an E-BL can:

(i) contain the same information as would be required to be contained in the paper equivalent;

(ii) be protected against unauthorised interference or alteration;

(iii) be susceptible to exclusive control;

(iv) be divestible;

(v) be capable of being possessed;

(vi) be identifiable as ‘the document’ so that it can be distinguished from any copies, and

(vii) use a reliable electronic trade document system to ensure that the document contains certain functionality designed to replicate the salient features of a paper trade document.

The pilot project deployed a unique approach in the field of E.B/Ls because (i) it did not set out solely to build an E.B/L platform; instead and taking lessons from the market, our system provides an interoperable means to transact any #DigitallyNegotiableInstrument (DNI) securely and to correlate it with tangible world assets, and (ii) we are a consortium of specialists outside of shipping. Put another way; we are not aligned with any carrier or E.B/L provider; we are not a competitor in an already crowded market; instead, we complement the market with technical expertise.

[1] Electronic trade documents: Report and Bill – HC 1188 Law Com No 405: London March 2022

Further reading here:

Trade Finance Global:

International Trade Magazine:

Yahoo Finance:

Yahoo Finance Australia:



Dark Reading:


Asia Bulletin:



The Korea Herald:

Canberra Times:

ASEAN briefing:

Value Invest Asia:

Association of Blockchain Asia: