Vakt, a blockchain platform for commodity post-trade management, has signed a memorandum of understanding (MoU) with essDocs to digitise the post-trade process for the north-west European barge market.
Traditionally, this market has relied on a highly inefficient paper-based post-trade process. Trading parties typically agree information to send on to the terminal, which then in turn add its own information before sending on to barge captains to agree and sign for the product and quantities loaded or discharged from the vessel. This lengthy process results in several paper documents including the barge receipt, which when physically signed allows the barge to sail and the seller to invoice the buyer.
This new partnership will eliminate those processes, allowing them to be handled entirely digitally. Paperless trade platform provider essDocs will implement its CargoDocs DocEx solution to replace paper documents such as barge receipts with electronic versions, and then through Vakt, these shipping documents and data will be added to the immutable, tamper-proof blockchain platform, offering an easily-retrievable single source of truth for all parties involved in the transaction.
“At its core, Vakt is a multisided platform that allows the various parties in a physical energy transaction – traders, terminals, inspection companies, brokers, port agents, brokers and trade finance banks – to exchange information securely and seamlessly,” says Etienne Amic, CEO of Vakt. “Some information is transactional; some operational; and some of it represents the documents related to the transfer of the physical goods themselves. There are not that many well-conceived solutions allowing these documents to be passed safely in a digital form within current legal constraints. It was therefore a very natural step for us to enter into a collaboration with essDocs, who have been developing solutions in this field for a number of years.”
Although the partnership’s initial focus is on the north-west European tank barge market, Alexander Goulandris, CEO of essDocs, highlights that the companies are “also exploring additional global markets where electronic documents are key to full digitisation”. According to essDocs, over 6,000 exporters, traders, importers, shipowners, ship agents and independent inspectors use its CargoDocs DocEx solution. Through this latest strategic alliance, the company plans to expand its usage across the combined Vakt and essDocs energy network.
This comes after essDocs announced a similar partnership in April with the Voltron blockchain consortium, which will see the firm implement its CargoDocs DocEx to the Voltron application, enabling banks and corporates to access CargoDocs data when executing a Voltron-based letter of credit.
For Vakt, this collaboration represents a further step towards expanding its services to cover the full physical energy trading ecosystem. At its launch in late 2018, the platform, which counts BP, Equinor, Shell, Gunvor and Mercuria as users, said it is building its roadmap “in response to industry need”. As well as Northern European refined product barges, it also plans to extend its platform to US crude oil pipelines and Northern Europe refined product barges later on this year.