An influential shipping industry body has said that adoption of electronic bills of lading (eBLs) still faces regulatory barriers in major markets, urging authorities to address legal uncertainty and harmonise requirements. 

Moving from paper bills of lading to electronic equivalents could cut direct trade costs by US$6.5bn, boosting growth while reducing the industry’s carbon footprint, says the Digital Container Shipping Association (DCSA), whose members include several of the world’s largest container shipping companies. 

But despite these benefits – and a series of legal reforms facilitating the use of electronic trade documents – the association says there remain several obstacles to full adoption rooted in the legal environment. Last year, just 3.8% of bills were electronic, up from 2.1% the year before. 

“Not all barriers can be addressed by the industry itself,” the DCSA says in a May report produced alongside law firm Baker McKenzie. “Indeed legislation and government procedures can complicate or even prevent the use of the eBL.” 

The association says that a review of the rules and procedures impacting eBLs in 15 jurisdictions shows their use is generally permitted today, without parties having to reach their own contractual agreements beforehand. 

Chinese Taipei, Germany and the UK have a “perfect score” in the commercial legal environment, having finalised legislation that explicitly allows eBLs without being overly prescriptive.  

Overall, Singapore, Taipei, China and Japan score highest of the jurisdictions reviewed, followed by Korea, the UK and Germany.  

However, across all jurisdictions reviewed – which together account for around 60% of global trade – there are a variety of challenges linked to the regulatory environment. 

The association finds some existing rules impose specific conditions, such as mandatory registration or the use of accredited technology solutions, while others set no conditions at all, risking regulatory fragmentation. 

“The more specific conditions are made, the more likely the conditions divert from other jurisdictions,” it says. “Jurisdictions in which the eBL is explicitly made possible but with technology neutral conditions demonstrate best practice.” 

The report says some markets, including Belgium, Hong Kong and the UK, currently show signs of “semi-digitalisation”, where parties can be required to present a digital copy of a paper document or where officials can request an original paper copy. 

Canada and the US, the two worst scoring jurisdictions, have “legacy issues” that still necessitate the use of paper, though the report says both show examples of best practice in other areas. 

Two markets, France and the Netherlands, currently have legislation in place that can prevent eBL usage, the association adds.  

Although initiatives to digitise are underway in both countries, the report warns that the Netherlands’ version “would divert substantially from other jurisdictions” if it is not brought in line with model laws drafted by a UN commission. 

There are also challenges within the private sector, the DCSA report finds. 

It says that during research, some private sector parties claimed paper bills of lading are required by law, whereas in reality barriers were rooted in internal compliance or risk management processes. 

“This seems to generally be the result of a lack of legal certainty [or] legal ambiguity, especially for banks and insurers,” it says. 

In Belgium, Hong Kong, Italy, the Netherlands and the UK, the report adds that attitudes towards digitalisation in the private sector seem “more passive and there is a tendency to maintain traditional ways of working”. 

The report calls on governments to address legal uncertainty without being overly prescriptive, and to harmonise conditions for eBLs across different areas of trade, such as transport, customs and finance. 

It adds authorities should resolve legacy issues prohibiting the use of eBLs, and encourage adoption by educating stakeholders on the benefits of digital trade.