Singapore and UAE conduct first cross-border digital trade document transfer
Singaporean and UAE financial regulatory organisations have successfully concluded a cross-border digital trade document transfer, the first of its kind.
Singapore’s Infocomm Media Development Authority’s (IMDA) TradeTrust framework facilitated the transfer of electronic records between the two jurisdictions, both of which have adopted the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Electronic Transferable Records (MLETR)
The IMDA, the Monetary Authority of Singapore (MAS) and the Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM), in collaboration with commercial partners DBS Bank, Emirates NBD and Standard Chartered, worked together on the pilot.
MLETR does away with the need for paper-based documents in cross-border trade finance, which are vulnerable to fraud and error due to its complex nature and the number of parties involved.
The framework harmonises the legal recognition of digital documents is part of a wider effort by the G7 to move towards electronic transferable records in international trade.
IMDA’s TradeTrust is an interoperable framework that provides proof of authenticity, origin and ownership of trade finance digital documents, enabling counterparties and banks to validate documents digitally and securely.
The government outfit claims the framework mitigates the risk of fraud, reduces costs, and improves trust and efficiency.
IMDA chief executive, Lew Chuen Hong, says: “The pilot demonstrates how the TradeTrust Digital Utility can facilitate the digitalisation of trade finance processes. We have complemented this by providing legal certainty to electronic transferable records through the MLETR.”
MAS deputy managing director of markets and development, Leong Sing Chiong, says: “As a key trade hub and international financial centre in Asia, Singapore is keen to accelerate the digitalisation of trade finance.
“With this pilot, we hope to see broader adoption of digital trade finance in Singapore and the region.”