A. General Information
Trade Financing Pilots to Promote Digital Trade between Singapore and China under Singapore – China (Shenzhen) Smart City Initiative(SCI)
B. Lessons Learned
Enabled by IMDA’s TradeTrust framework, banks, shipping lines, buyers, sellers, platform service providers and fintech companies have collaborated on successful technical pilots on trade financing using simulated electronic Bills of Lading (eBLs). UOB, together with its Shenzhen Branch in China, and their clients have successfully concluded two digital trade financing technical pilots. DBS Singapore, DBS China and their client have also conducted a third successful technical pilot. The successful pilots conducted in the second half of 2021 demonstrated how key maritime trade documents like the eBL could be used across different trade financing platforms and jurisdictions. Businesses between Singapore and Shenzhen can also soon enjoy expeditious cross-border trade financing transactions as the SCI continues to deepen technological cooperation and test policy innovations between both cities.
Transferable documents: Trade documents that entitle the holder to claim the performance of an obligation or ownership (e.g. bills of lading, bills of exchange, etc.). In 2017, The UNCITRAL Model Law on Electronic Transferable Records (MLETR)117 was introduced to enable legal use of electronic transferable records (ETRs) that are functionally equivalent to transferable documents. The ETRs would need to satisfy the requirements of singularity, exclusive control and integrity. Blockchain technology can be used in the implementation of ETRs. For example, the ERC721 provides a smart contract API used for non-fungible tokens (NFTs) that supports transfers of ownership whilst being able to provide satisfaction of key functional requirements of the MLETR.
(bills of lading, bills of exchange, etc.)