Professional Documents
Culture Documents
ICL Paper BA-LLB - 48
ICL Paper BA-LLB - 48
Abstract:
This research paper examines the significant impact of the Electronic Bill of Lading ( eBL)
on the efficiency and safety of international trade. The paper first introduces the historical
context of the traditional Bill of Lading and then discusses the progress made towards the
evolution of the EBL system. Then, the paper reviews a broad array of literature focusing on
the current advantages, challenges, and implications of electronic Bill of Lading to
international trade and that demonstrates that the EBL solution has the capacity to alter global
trade by greatly increasing efficiency, lowering costs, and boosting security. For centuries,
the paper-based system has been at the heart of global trade. Nonetheless, the inefficiency
and security threats of paper BLs have promoted the innovation and uptake of eBLs. This
study has explored a literate on eBLs and synthesized the advantages, difficulties, and
international trade impact of eBLs. The results indicate that eBLs have a considerable
strength to improve trade efficiency by minimizing paperwork and enabling an easy and
transparent process. Second, eBLs integration features make them secure through verifying,
monitoring, and encoding data while in transit, which can protect fraud and robbers.
However, several problems such as legal and regulatory constraints, technology challenges,
and lack of industry-wide use prevent immediate adoption. In general, it can be concluded
that the eBL revolutionizes international trade by improving efficiency and safety accounts,
but there remains a critical need for more research and integration.
Keywords: Electronic Bill of Lading, eBL, international trade, efficiency, security
Introduction
International trade is an indispensable part of the global economy responsible for the trade of
goods and services across international borders and linking economies in various parts of the
world. Bill of Lading is a crucial aspect of the international trade process, a document issued
by a carrier to confirm the receipt of goods to be shipped. The BL is a receipt, contract of
carriage, and title document. The document is essential in the international trade context to
facilitate the delivery of goods to their rightful receiver bearing the terms and agreements
which the seller and buyer entered into.
In international trade, the conventional paper-based Bill of Lading has been the norm for
decades. However, the flaws and inefficiencies of this system have long been questioned.
Paper-based BLs are labour-intensive and prone to human mistake when processed manually.
They are also vulnerable to theft, loss, and fraud. Due to these difficulties, there is now more
interest in using Electronic Bill of Lading (eBL) solutions to digitize the BL process.
eBL systems offer a digital replacement for traditional paper BLs and have numerous benefits
over their paper-based counterparts. The shipping procedure is accelerated by electronically
generated, signed, and transferred eBLs, which do away with the need for paper
documentation. eBLs also come with enhanced security features including tracking,
authentication, and encryption that can help stop fraud and theft.
The use of eBLs has the potential to drastically improve efficiency and security, which might
transform global trade. Trade transactions can be completed more quickly and affordably
using eBLs thanks to their ability to streamline procedures, cut down on paperwork, and
increase transparency. Furthermore, trade transactions can be made more trustworthy and
safer by utilizing the additional security capabilities of eBLs to assist thwart fraud and theft.
Nevertheless, there are a number of issues that must be resolved in spite of the potential
advantages of eBLs. The main obstacles to the widespread deployment of eBLs include
technological limitations, legal and regulatory difficulties, and the requirement for industry-
wide acceptance. To completely comprehend the effects of eBLs on global trade and to
determine the best ways to apply them, more study is also required.
The purpose of this study is to investigate in further detail how Electronic Bill of Lading
affects the security and efficiency of international trade. It will examine the body of research
on eBLs, emphasizing the benefits, drawbacks, and implications for global trade. Along with
discussing the wider effects of eBLs on international trade, the presentation will look at case
examples of businesses or nations that have adopted eBL systems. The paper will conclude
with a discussion of how eBLs might transform global trade and a summary of future
research areas for eBLs.
Literature Review
Electronic Bill of Lading (eBL) has emerged as a transformative technology in international
trade, promising significant improvements in efficiency and security. This literature review
aims to provide an overview of the existing research on the impact of eBL on international
trade efficiency and security, highlighting the advantages, challenges, and implications of its
adoption.
One of the key advantages of eBL is its potential to improve the efficiency of international
trade processes. Traditional paper-based Bill of Lading (BL) systems are often cumbersome,
involving physical documents that need to be processed and transmitted between multiple
parties. In contrast, eBL systems digitize the entire process, allowing for faster, more
streamlined transactions.
A study by Alvarez (2018) found that eBL systems can significantly reduce paperwork in
international trade transactions. By eliminating the need for physical documents, eBLs can
streamline the documentation process, reducing the time and cost associated with processing
paper BLs.
Kumar (2022) conducted a study on the impact of eBL on trade efficiency and found that
eBLs can lead to faster processing times. By enabling electronic transmission of documents,
eBLs can reduce delays caused by manual processing and physical document transfer.
In addition to efficiency gains, eBL systems also offer enhanced security features, which can
help prevent fraud and theft in international trade transactions. Traditional paper-based BLs
are susceptible to manipulation and counterfeit, whereas eBLs can provide greater security
through encryption and authentication mechanisms.
eBL systems offer advanced authentication and tracking features, which can help verify the
authenticity of documents and track the movement of goods. This can help prevent fraud and
ensure that goods are delivered to the correct recipient.
Another security feature of eBL systems is data encryption, which can help protect sensitive
information from unauthorized access. By encrypting BLs and other trade documents, eBL
systems can enhance the security of international trade transactions.
While eBL systems offer significant advantages, they also face several challenges that can
hinder their adoption and implementation in international trade. One of the main challenges is
the legal and regulatory framework surrounding eBLs, which varies by jurisdiction and can
impact their validity and enforceability.
The adoption of eBLs requires a supportive legal and regulatory framework to ensure their
validity and enforceability. Governments and international organizations play a crucial role in
establishing and harmonizing the legal framework for eBLs.
3.2 Technological Barriers
Another challenge is technological barriers, such as the need for investment in technology
and infrastructure. Implementing eBL systems requires significant upfront investment, which
can be a barrier for some companies, especially smaller ones.
The success of eBLs also depends on industry-wide adoption. While some companies and
industries have embraced eBLs, others have been slower to adopt due to concerns about
security, reliability, and interoperability.
Methodology
The utilization of a combined methods strategy is undertaken within this scholarly article in
order to scrutinize the repercussions of electronic bill of lading (eBL) on the efficiency and
security of global trade. The research approach encompasses qualitative and quantitative
methodologies in order to furnish an exhaustive scrutiny of the subject matter.
Qualitative Research: The examination of the quality facet of the research encompasses an
exhaustive evaluation of extant literature sources, encompassing scholarly articles, industrial
assessments, and governmental releases. Within this comprehensive literature survey lies the
foundation for comprehending the historic underpinnings of the bill of lading, the progression
of eBL, and the examinations carried out on the repercussions of eBL on trade effectiveness
and safeguarding. The qualitative evaluation further comprises instances of prosperous eBL
integrations in varied nations and sectors, furnishing practical illustrations of the advantages
and obstacles related to the adoption of eBL.
Quantitative Research: The numerical factor of the investigation consists of gathering and
scrutinizing information to quantify the effect of eBL on the effectiveness and security of
trading. This encompasses the compilation of data on essential performance metrics (EPMs)
like processing durations for documentation, rates of errors, and financial benefits connected
with the adoption of eBL. The information is assessed employing statistical methodologies to
detect patterns and trends that exhibit the influence of eBL on trading procedures.
Overall, the mixed-methods approach employed in this research paper provides a holistic
understanding of the impact of eBL on international trade efficiency and security, combining
theoretical insights with empirical data to offer valuable insights for policymakers, industry
stakeholders, and researchers.
But with the world’s industries becoming more digitally integrated, and in large part because
of the recent enactment of the E-Bills of Lading Act, electronic bills are anticipated to
proliferate in international trade and shipping operations, eventually displacing their paper
counterpart completely.
In some circumstances, this document may also function as a document of title, particularly
in relation to negotiable bills of lading. If a bill of lading is negotiable, the holder of the
document may transfer ownership of the goods. When the goods arrive at their destination,
the holder of the original negotiable bill of lading is entitled to claim and take ownership of
them. This idea is comparable to the process of proving ownership of a car using a physical
title document.
Because they serve as documentation of shipments, proof of the contractual arrangement
between the shipper and the carrier, and a means of securing cash or products upon the arrival
of the cargo, bills of lading are essential to international trade. They also have a significant
impact on record-keeping, legal and financial operations, freight insurance, and logistics. In
the end, bills of lading play a crucial role in guaranteeing the planned and traceable
transportation of commodities in both local and international trade. A bill of lading is crucial
since the person holding it is the owner of the goods, to quote Maersk. It serves as a formal
title document that enables the bearer to assert ownership of the goods.
When shipping cargo or freight from one location or distribution centre to another, a bill of
lading is crucial. It functions as a receipt that a carrier issues to the shipper in addition to
being a contract between a carrier and the shipper for the carriage of goods.
The bill of lading In general, these include a shipping receipt, a transferable title document
that allows the holder to demand the cargo, and proof of the terms. Before the cargo are
turned over, the ship-owner or his agent at the port of destination will need to see one
authentic bill of lading. In addition, if the freight hasn’t been paid at the port of
transportation, he will typically demand payment. The value of a set of bills of lading is lost
when one of the bills is delivered to the shipping firm. If the person claiming to be the
consignee provides a letter of indemnity—which is typically countersigned by a bank—the
shipping company will permit delivery of the goods in the event that the bill of lading is lost
or delayed in transit. This releases the shipping company from any liability should the actual
bill of lading eventually be discovered by another party.
The Electronic Bill of Lading (eBL) is a digital adaptation of the paper-based Bill of Lading,
which is the foundation of international trade. The eBL functions in much the same way as its
physical forebear; it serves as a recognized proof of ownership for goods in transit and acts as
a contract between the shipper and carrier. However, unlike traditional bills printed on paper,
electronic ones are created entirely in cyberspace — they exist only in digital form — this
makes them faster, more secure and easier to handle.
Digitality is one of the most important characteristics that make an electronic document like
BL efficient. It can be generated electronically, signed electronically , transmitted
electronically thus removing the necessity for any hard copies which take up time and require
manual labour or additional expenses to produce them. Moreover, being saved in computers
creates opportunities for better organization systems such as easy retrieval when required plus
faster sharing among concerned parties leading ultimately towards quickening trade
processes.
Security is always vital during any international business transaction; hence eBL has
incorporated advanced security measures designed specifically for this purpose too. For
instance encryption usually takes place making sure everything remains intact while
authentication ensures that no unauthorized person gains control over such important records
thereby preventing frauds from happening across different stages relating to shipping goods
globally.
Another transparency and accessibility of the eBL is that it can be easily accessed and shared
among authorized parties since they are stored electronically. This enhances visibility within
a supply chain by reducing delays and errors related to paper-based records. Furthermore,
tracking can be done on real-time for electronic Bills of Lading (eBLs) thus giving concerned
individuals current details about where goods are while in transit.
Flexibility is also among the several things that characterizes an eBL; the document may
include extra data fields or have transaction-specific information inserted into it thereby
making different types of consignments easy to handle using this system. Such kind of
adaptability enables these papers to be used in many trade deals ranging from simple ones up
to complex ones.
The under listed are some of the terminologies associated with Electronics bills of ladings
transactions :
ii. EDI means electronic data interchange which s the interchange of trade data
carried out by e-transaction.
iii. Unedifact means the United Nations Rules for Electronic Data Interchange for
Administration, Commerce and Transport.
iv. Transmission means one or more messages electronically sent together as one
unit of dispatch which includes heading and terminating data.
vi. Private Key means any technically appropriate form, such as a combination of
numbers and/or letters, which the parties may agree for securing the authenticity
and integrity of a Transmission.
vii. Holder means the party who is entitled to the rights described in Article 7(a) of
the Uniform Rules of conduct for Interchange of Trade Data by Tele transmission,
1987, by virtue of its possession of a valid Private Key.
viii. Electronic monitoring system means the device by which a computer system can
be examined for the transactions that it recorded, such as Trade Data Log or an
Audit Trail.
The Electronic Bills of Lading is also subject to rules of procedure to ensure compliance and
uniformity. The conduct between parties to an electronic bill of lading is governed by the
Uniform Rules of Conduct for Interchange Of trade Data by Tele transmission, 1987
(UNCID) shall govern the conduct between the parties. The EDI under these Rules must
conform to the relevant UN/EDIFACT standards. However, the parties may use any other
method of trade data interchange acceptable to all the users.
A genuine Electronic Bill of Lading must have three core attributes, namely;
A) Legal framework : A legal framework must be put in place either through the
current multipartite agreement route or, in future and subject to their widespread
adoption, via the Rotterdam Rules, to ensure that the electronic bill of lading (eB/L)
replicates the rights and obligations of the parties under a paper Bill of Lading. As an
essential component of this legal framework, any provider of an electronic bill of
lading solution must as a matter of necessity, ensure that its system meets all its users’
insurance requirements, particularly those of ship owner Insurance.
B) Functional framework.
The electronic bill of lading must have the necessary range of functions as follows;
a. The inherent functionality to allow the progress of an eB/L from issue to
production in a manner similar to a paper bill of lading: this includes the
ability to;
1.The General Assembly of the United Nations in December 1996 adopted the UNCITRAL
Model Law on Electronic Commerce, which is intended to serve as a model to countries in
order to create a uniform law and practice involving the use of computerized systems in
international trade.
2. Legislation based on the UNCITRAL Modern Law on Electronic Commerce, 1996, has
been adopted in 20 countries as follows:
i. AUSTRALIA: adopted it through the Electronic Transactions Act, 1999 (Act No.
162, 1999)
ii. BERMUDA: adopted the model law in the Electronic Transactions Act, 1999
iii. COLOMBIA: The Electronic Commerce Law, 1999
3.In the United States, the Uniform Electronic Transaction Act,adopted in 1999 has been
enacted by almost all States in within the United States. Canada adopted, The Uniform
Electronic Commerce Act, 1999, which has been adopted by 10 provinces and territories of
Canada. Other Countries includes Malaysia and Argentina. Malaysia adopted the Digital
Signature Act, 1997, which is compatible with the patter of the UNCITRAL Model Law and
in 2001, the status was upgraded with the enactment of the, Digital Signature (Amendment)
Act, 2001.
4. Nigeria is not mentioned in UNCITRAL database, which means, they are yet to adopt the
Model Law. In Nigeria. However, the Federal High Court has the jurisdiction to hear matters
relating to maritime issues. Nigeria is a major world destination of cargo and the trade
volume between Nigeria and other countries of the World increases daily. The Nigerian
seaports are busy by the day due to large volumes of transactions and as such the need to
adopt the Model Law in Nigeria is required.
It has been generally seen that Electronic Bill of Lading in most part of the world has
evidential value because in both civil law and common law systems, computerized
records are generally admissible as evidence in many countries. For example, in
Derby & Co Ltd v. Weldon & Others the English Court held that the database of a
Computer, in so far as it contained information capable of being retrieved and
converted into readable form and whether stored in the computer or record in backup
file, is a document for the purposes of the High Court Rules governing discovery
document.
“In any legal proceedings, nothing in the application of the rules of evidence shall apply so as
to deny the admissibility of a data message in evidence:
ii. If it is the best evidence that the person adducing it could reasonably be expected
to obtain, on the ground that it is not in its original form”.
Article 5 of the Model Law, provides that “information shall not be denied
effectiveness, validity or enforceability solely on the ground that it is in the form of a
data message”. It is therefore a legal truism that the Model Law governing Electronic
Bill of Lading globally, expressly gives electronic messages the same legal status as
writing.
“Where the law requires information to be in writing, that requirement is met by a Data
message if the information contained therein is accessible so as to be useable for subsequent
reference”.
The shipper must confirm this receipt message to the carrier, upon which Confirmation; the
shipper shall be the Holder. Upon demand of the Holder, the receipt message shall be updated
with the date and place of shipment as soon as the goods have been loaded on board.
Terms and conditions usually form part of the Contract of Carriage and must be
readily available to the parties to the Contract. In the event of any conflict or
inconsistency between such terms and conditions, the Rule of International
Conventions shall prevail.
ii. Nominate the consignee or substitute a nominated consignee for any other party,
including itself,
iii. Transfer the Right of Control and Transfer to another party;
iv. Instruct the carrier on any other subject concerning the goods, in accordance with
the terms and conditions of the Contract of Carriage, as if he were the holder of a
paper bill of lading.
a. By notification of the current Holder to the carrier of its intention to transfer its Right
of Control and Transfer to a proposed new Holder, and
c. The carrier shall transmit the information to the proposed new Holder, whereafter
d. The proposed new Holder shall advise the carrier of its acceptance of the Right of
Control and Transfer, whereupon
e. The carrier shall cancel the current Private Key and issue a new Private Key to the
new Holder.
Of noteworthy is the fact that the transfer of the Right of Control and Transfer in the
manner prescribed above shall have the same effects as the transfer of such rights
under a paper bill of lading.
The Private Key is of vital importance in Electronic Bill of Lading. The private key is
unique to each successive holder. It is not transferable by the Holder. The carrier and
the Holder shall each maintain the security of the Private Key.
DELIVERY
Under the Electronic Bill of Lading, the carrier shall notify the Holder of the place
and date of intended delivery of the goods. Upon such notification the Holder has a
duty to nominate a consignee and to give adequate delivery instructions to the carrier
with verification by the Private Key. In the absence of such nomination, the Holder
will be deemed to be the consignee.
The carrier shall deliver the goods to the consignee upon production of proper
identification in accordance with the delivery instructions specified and such delivery
shall automatically cancel the Private Key.
The carrier shall be under no liability for wrong delivery if it can prove that it
exercised reasonable care to ascertain that the party who claimed to be the consignee
was in fact that party.
The world of international trade paperwork has changed as a result of Electronic Bill of
Lading (eBL), which comes in a variety of forms to meet diverse needs and technological
capacities. To fully realize how electronic business letters (eBL) may improve trade
efficiency and security, it is essential to comprehend various kinds of BL and their
advantages over conventional paper-based BL.
There are two different methodologies of documenting and managing the movement of
tangible assets in international trade and they are associated with the Traditional Paper-based
Bill of Lading (BL) and the Electronic Bill of Lading (eBL). While they share the same
purpose, they have great disparities in terms of their features, supremacies, and demerits.
1. Documentation Processing:
Traditional Paper-based BL: Requires manual processing, including
printing, signing, and physical delivery. This process is time-
consuming and prone to errors and delays.
Electronic BL: Can be generated, signed, and transmitted
electronically, reducing the time and effort required for documentation
processing. This streamlined process leads to faster transaction times
and improved efficiency in trade operations.
2. Security:
Traditional Paper-based BL: Vulnerable to loss, damage, and
tampering. Requires physical storage and transportation, which can
increase the risk of security breaches.
Electronic BL: Offers enhanced security through encryption and
authentication mechanisms. Digital storage reduces the risk of loss or
damage, and the digital nature of eBLs makes them harder to tamper
with compared to paper documents.
3. Cost Savings:
Traditional Paper-based BL: Incurs costs for printing, storage, and
transportation. These costs can be significant, especially for large
volumes of transactions.
Electronic BL: Eliminates the need for physical documents, resulting
in cost savings for traders. Additionally, the digital nature of eBLs
reduces the need for manual intervention, further reducing costs
associated with documentation processing.
4. Environmental Impact:
Traditional Paper-based BL: Contributes to environmental degradation
through the consumption of paper and energy for printing and
transportation.
Electronic BL: More environmentally friendly, reducing paper
consumption and carbon emissions associated with traditional paper-
based processes.
1.Processes optimization: The paper B/L requires printing, packaging, shipping, and waiting
for a response, which prolongs the commercial process by days or even weeks. Even more so
if shipping losses cause this procedure to be halted. This isn’t the case with its electronic
format because all the data is registered online, allowing for process continuity, acceleration,
and optimization.
2.More safety: Since the eB/Ls are processed properly and securely, there are no losses or
frauds during transportation because there is no physical movement. Furthermore, significant
solutions to remove the risks in these activities can be realized with technology like
blockchain.
3.Immediate information: The parties have access to the information immediately and at
their fingertips at any time, which facilitates the operation’s follow-up.
4.Useful for everyone: Since it’s an automated documentation procedure, the parties, banks,
freight forwarders, and shippers can communicate easily thanks to the established standards.
This implies that regardless of origin, everyone speaks the same language.
5.Fewer mistakes: As already said, the B/L is an important document in maritime logistics,
and avoiding mistakes in it is crucial. The electronic Bill of Lading allows to minimize those
codifications mistakes that can happen by registering or correcting the information because it
has forms fields and standard autocomplete functions.
eBL (Electronic Bill of Lading) can be a powerful catalyst of the global trade transformation,
offering advantages like higher efficiency, better security, and overall cost savings.
Nevertheless, eBL implementation has its limits and barriers that must be tackled to improve
its existence. These challenges are the legal and regulatory hurdles, the technological
limitation and the interoperability issues, and the resistance to change and the lack of
awareness respectively.
Confronting these difficulties and obstacles is critical and has to be closely pursued by the
governments, research organizations, and technology providers. Legal systems and
authorities should get updated to identify and assist the practical use of eBL. The inegration
should be doen to prevent any commun interaction issues which may emerge between the
domiciles BL systems. As part of this, awareness campaigns and training programs are
necessary for educating stakeholders on the merits of intimation of bills of lading via
telecommunication and how to incorporate it accordingly in their trade operations.
Case Studies
Given below are some examples of Successful Implementation of Electronic Bill Of Lading:
Now, here are some Case studies showing impact of eBL on Trade Facilitation and Supply
Chain Efficiency:
Conclusion
The introduction of Electronic Bill of Lading (eBL) offers an opportunity to
revolutionize the way of international trade by offering higher level of safety and
efficiency across the board. Through the digitalization of the trade documents, eBLs
are a means that enable advantages like minimization of document management,
faster processing times, increased security of documents, and greater level of
transparency in trade transactions.
The use of eBL case studies in countries such as Singapore, the Netherlands, and
Australia, and partnerships like Maersk and IBM TradeLens platform and Bolero
International ePresentation solution, among others, clearly shows that eBL improves
supply chain efficiency and streamlines trade operation.
Anyway, the increased eBL use might face a number of barriers, among others the
legal and the regulatory barriers, the technological limitations and the “human beings
are crooked” syndrome. This issue calls for all the concerned parties to work together
including the governments, entrepreneurs and the technology stakeholders for the
development of standard policies, improvement of the infrastructure and sensitize all
the stakeholders on the notion of e-BL.
The future of eBL seems to be extremely promising with advanced technologies, such
as blockchain integration, AI, and IoT, presently under development to enhance both
the effectiveness and the security aspects of electronic bills of lading. Although there
are obstacles, the digital letter of credit technology that will eliminates the paperwork
in international trading is expected to be encouraged, and as a result, there will be an
effective and sustainable global trade ecosystem.
References :
Alvarez, J. (2018). The Digital Revolution in Trade Finance. International
Chamber of Commerce. https://iccwbo.org/publication/digital-revolution-
trade-finance/
Asian Development Bank. (2020). Digital Trade Facilitation in Asia and the
Pacific. https://www.adb.org/publications/digital-trade-facilitation-asia-and-
pacific