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Financial Services Law Insights and Observations

UNCITRAL Adopts Legal Framework for Electronic Records Use

Fintech ESIGN UNCITRAL Electronic Records MLETR UETA


On July 13 the United Nations Commission on International Trade Law (UNCITRAL) adopted the Model Law on Electronic Transferable Records (MLETR). If broadly enacted by nations, the MLETR would provide uniform legal framework for the use of electronic records in connection with transferable records—including bills of lading, bills of exchange, promissory notes and warehouse receipts. By establishing uniform standards under which electronic records of such documents may be the equivalent to paper, the MLETR has the potential to streamline international commerce and provide a higher level of security over paper documents. The model law, among other things, addresses standards for establishing control of an electronic record as the equivalent of possession of a paper instrument, as well as guidance for establishing the reliability of systems and methods used for the generation and transfer of such records. Like the UETA and ESIGN in the United States, the MLETR is meant to be technology-neutral and is designed to work within the framework of existing laws governing transferable records. The full text of the final MLETR and an accompanying Explanatory Note (akin to official comments) will be available here.

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