Part 1: MLETR, The Model Law on Electronic Transferable Records
Part One of the Havona three part blog series on the key frameworks on the road to implementing digital trade and the transfer of electronic records in international trade.
In this introduction, we will discuss the role of the United Nations Committee on International Trade Law (UNCITRAL) in developing international frameworks to promote the use of electronic methods in business dealings. The Model Law on Electronic Transferable Records (MLETR) is a prominent framework that encourages the legitimate use of ETRs in domestic and international trade.
Using the Multilateral Electronic Trade Regime to Facilitate Digital Commerce
The goal of the MLETR is to make it easier to utilise electronic transferable records, which are legally binding and may be used in the same way paper papers or instruments can to transfer rights to performance following possession transfer. Warehouse receipts, promissory notes, bills of lading, and exchange draughts are all examples of papers that can be transferred.
Digital trade transactions, which the framework hopes to facilitate, have the potential to expedite and secure digital commerce, as well as automate some transactions using smart contracts. The MLETR is projected to be especially helpful for developing nations that want to set up electronic warehouse receipts to enable farmers gain access to loans.
Similarity in Function and Regulation
Nondiscrimination, functional equivalence, and technical neutrality are the cornerstones on which the MLETR is built. Electronic transferable records must meet the same criteria as a paper document or instrument, including being able to be reliably identified, rendered, and kept in their original, unaltered form.
The MLETR places a premium on the idea of control, which is analogous to the legal possession of a transferable document or instrument. To determine who owns an electronic transferrable record and establish exclusive control over it, a trusted mechanism must be utilised. When one party can be positively identified as the controller, possession is established.
Conclusion
The Multilateral Electronic Transactions Requirements (MLETR) establishes rules for the legitimate exchange of electronic records across national borders. With its emphasis on nondiscrimination, functional equivalence, and technical neutrality, it facilitates the widespread use of digital commercial transactions. The MLETR supports the usage of electronic transferable records in a paperless commerce setting by creating trustworthy techniques for identifying, rendering, and protecting the integrity of such data.
