On July 13, 2017, the UN Commission on International Trade Law (UNCITRAL) released for implementation the Model Law on Electronic Transferable Records (MLETR). The MLETR legally enables the use of electronic transferable records that are functionally equivalent to transferable instruments including bills of lading, bills of exchange, promissory notes and warehouse receipts. The use of electronic transferable records is expected to bring about benefits to electronic commerce including efficiency and security of transmission. Electronic transferable records are relevant for business areas such as transport and logistics and finance. The MLETR sets forth the requirements for the use and defines control as the functional equivalent of possession of a transferable instrument. The MLETR also provides guidance on the assessment of the reliability of the method used to manage the electronic transferable record, on change of medium and on cross-border aspects. The adoption of the principle of functional equivalence allows the MLETR to operate without affecting the substantive law. The adoption of the principle of technology neutrality allows to accommodate the use of all methods and technologies, including blockchain distributed ledgers).
JCP congratulates the successful completion of the MLETR project and the UNCITRAL Working Group IV that has been working on this very hard for years. Hopefully the new Model Law will be widely adopted around the world like the previous two Model Laws in the filed of e-commerce.