Legally binding digital original documents is possible with trace:original
There are many situations where an original document must be presented in order to claim its legal content. Good examples are bills of exchange and some trade finance documents, such as bills of lading. In other situations, it can be convenient and of significant evidentiary value to know who holds the master document, the original, in a digitalised environment.
For all documents referred to above, containing a future promise to pay, deliver goods or perform a service, the formal requirements are that the promise has to be in writing and in many cases it must also be duly signed by authorised persons. These types of documents frequently need to be transferred to a holder in due course and sometimes these documents need to be endorsed.
Possession of a digital original document
When digitising these documents, it is critical to know who holds the master document, the original, which is something that has not been possible until now.
Enigio has solved this problem with a patented solution - trace:original - that safely creates and manages who is the holder of the digital original document throughout its lifetime. All of this without having to put business content in a blockchain, nor the need for creating a closed ecosystem for users.
In most jurisdictions there is legislation regulating which types of documents are legally admissible in electronic form. Furthermore, many jurisdictions have signature regulations defining how electronic signatures should be applied and how electronic identifications should be performed. The trace:original solution can be used with reliance on statutory law in all jurisdictions where the law is applied in a technology neutral manner.
In jurisdictions where statutory law does not cater for trade with electronic documents such as promissory notes or bills of exchange the International Trade and Forfaiting Association (ITFA) has developed electronic payment undertakings (ePU) equivalent to bills of exchange and negotiable promissory notes, but based on English contract law. The ePU is available for members of ITFA.
Adoption of MLETR
Currently there is significant progress in harmonising legal admissibility of electronic documents of title, negotiable instruments and other documents that need to be drawn up in an original enabling the holder to have “possession” of a document, i.e., as an original. In this endeavour the UN Model Law for Electronically Transferable Records (MLETR) is the template to which different jurisdictions seek to adapt their legislation.
The adoption of the MLETR is promoted by the United Nations Commission on International Trade Law and seen as a priority by the G7 and G20 countries. The ambition of International Chamber of Commerce is that 100 countries shall be MLETR complaint by 2025.