In our October 2021 blog “Possession as we (don’t) know it!”, we discussed the existing position under English law in respect of electronic trade documents and the scope for reform in light of the Law Commission’s consultation paper and draft legislation “Digital assets: electronic trade documents (2021) Law Commission Consultation Paper No 254”, published on 30 April 2021.
Continue Reading Solving the ‘possession’ problem – Law Commission publishes draft legislation for the legal recognition of electronic trade documents

Possession and tangibility are closely related concepts long established under English law. Yet a change to these concepts is around the corner. The change could finally unlock the full potential of digital trade documents, while at the same time keeping English law at the forefront of global commerce.

The existing position under English law is that one cannot legally ‘possess’, or have physical control of, something intangible (not including intellectual property rights, which are governed by separate rules). This means that a purely electronic or digital trade document cannot be possessed, and so cannot fulfil the legal functions of its possessable paper equivalent. But the UK Law Commission’s recent proposals for the reform of English law regarding possession of electronic trade documents and the accompanying draft legislation (the Draft Bill) suggest that more universal digitisation of electronic bills of lading and other trade documents will soon be a reality.

Electronic trade documents, at least in the form of ‘e-bills’, have been in use for almost two decades due to their undisputed benefits and efficiency. However, they remain, as the Law Commission puts it, “workarounds” to the problem of intangible, digital documents not being capable of possession under English law. This is primarily because electronic documents are created under multi-party contracts between a closed group of parties engaged in a particular trade that agrees to recognise them as having the same qualities as a paper document.

What the Law Commission’s proposals seek to address is the “possession problem”, a timely example of English law keeping up with technological solutions (including blockchain) to give electronic trade documents the same legal function as their paper equivalents.

What does the new law say?Continue Reading Possession as we (don’t) know it!

2020 has presented a number of challenges to the shipping industry, certainly none more so than the global pandemic which has significantly disrupted international trade and profoundly affected crew welfare.  The closure of national borders and the curtailment of commercial flights has introduced other limitations, including the ability of lawyers to travel to vessels following a marine casualty.  While this is certainly less of a concern than the plight of many seafarers, who have been stranded on board vessels without any immediate prospect of returning home to their families, it nevertheless presents another unwelcome headache for ship owners.

Evidence collection

Following any significant marine casualty, whether a collision, grounding, fire, or other significant event, it is essential that evidence is properly preserved.  This will be relied upon as the subsequent legal ramifications of the incident play out, which can often take many years.  The early preservation of evidence prevents electronic data being lost, or crew witnesses leaving the employment of the ship owners and subsequently being unavailable or unwilling to provide witness statements.
Continue Reading Remote casualty investigations

In these unprecedented times of global shutdown, the shipping industry has been forced to move rapidly into the digital age. Vessels still require their statutory surveys and the clock does not stop just because the surveyors are unable to fly out to a vessel. This has forced flag states and Recognised Organisations (ROs) to develop their own procedures for remote surveys/inspections.

Remote surveys/inspections were already in use before COVID-19 – Lloyd’s Register performed one in five of its surveys without attending the ship – but their use has increased considerably. In March 2020 the number of complex remote surveys performed by Lloyd’s Register increased by 25 per cent. As resources continue to remain limited, remote surveys/inspections will be an increasingly utilised tool from the suite of options available to flag states and ROs.
Continue Reading Remote surveys – the future?

After several successful trials over the last year, Israel’s largest cargo shipping company, Zim, has implemented a blockchain platform for electronic bills of lading.  According to Zim, this technology could replace paper bills of lading and further improve other activities which rely on physical means of transfer.

Zim recently conducted several transactions in which bills

The following guest blog was written by William Egerton LVO, Cyber Advisor, Charles Taylor

The amount of concern articulated about new technology in the recent survey conducted by Reed Smith is both welcome and revealing.  It is a healthy sign that respondents are concerned about cyber security and the impact of new technology on their business, whether for emissions control or other areas of improved performance.  But the rise of automation and the prospect of greater autonomous capability raise the issue of asset protection too: how can owners and charterers be sure that a vessel laden with precious cargo will travel without incident from port A to port B?  Will the (reduced) number of people left on board be able to regain control if the autonomous capability somehow gets subverted?  I would, however, challenge shipowners and charterers to match their rhetoric and concern with the resources necessary to do what is required to secure their business.Continue Reading Cyber Risk in Shipping

In a survey conducted by Reed Smith in the first half of 2018, industry participants predicted that big data analytics will be one of the most significant drivers of change in the shipping industry over the next five years. In addition, for the same five-year period, the survey revealed that the shipping industry considers the development of automated processes and functions on board vessels to be the biggest driver of efficiency in shipping.

The collection, analysis and management of huge volumes of unstructured data (i.e., big data), such as data on voyage performance, ship structure, machinery, fuel consumption, traffic, cargo and the weather, are expected to provide valuable insights into the operation of ships, and uncover hidden patterns as well as market trends. The analysis of big data will also allow the prediction of likely outcomes in certain voyages. In addition, it is likely to reduce costs, as the industry will be able to identify more efficient ways of doing business; it will allow decisions to be made more quickly; and it will make shipping safer by reducing risks.
Continue Reading Big data analytics and autonomous vessels – when will legislation catch up?

How ready is the shipping industry for data and digital technologies?

We are conducting a short anonymous survey to discover whether the shipping industry is embracing the digital age. Through collecting responses from companies representing the industry across different sectors and geographies, we’ll be looking to analyse how prepared different segments of the market are for