ONE eBL(Electronic Bill of Lading)Starter Pack v1.0

September 2021

OCEAN NETWORK EXPRESS Pte. Ltd.
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CONTENTS
01 What is a Bill of Lading (BL)?

05 Benefits of eBL

02 What is an Electronic Bill of Lading (eBL)?

06 Limitations of eBL

03 What is NOT an Electronic Bill of Lading (eBL)?

07 Legality of eBL

04 Why the change to eBL now?

08 Fitting eBL functionality into ONE process

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History of Bill of Lading (BL)

What is a Billof Lading(BL)?
“A bill of lading is adocument issued bya carrier toacknowledge
receipt of cargo forshipment.”(Source: Wikipedia)

Middle Ages

1727

BL non-existent; merchant was the master, nodocuments, speculative businessFirst definite evidence b/l was made ‘to order’. Transfer
by endorsing thus becoming a document of title.

14thCentury

Cargoes started tobe registered in a‘ship-book’ by adesignated clerk.
This book (ormanifest) served as
evidence of receiptof the cargo

19thCentury

Bill of lading gained its third function - evidence ofcontract of carriage

3 Main Attributes
Evidence of Receipt

Document of Title

Contract of Carriage
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What is anElectronic
Bill of Lading(BL)?

“An electronic record
which aims to havethe functional
equivalence of an
original paper BL”

An electronic Bill of Lading also has the same attributesof a master Bill of Lading
Evidenceof Receipt

Documentof Title

The release of an electronic bill of lading also acts asevidence of cargo receipt by the carrier.

An electronic BL also acts as a document of title. It isparamount that the document is unique, ensuring that only
one legal owner exists>>> main characteristic for electronic documents <<<Contract ofCarriage

The issuance of an electronic bill of lading also acts as acontract of carriage between carrier and shipper.

(Source: Tricks and Parson, ICC report 2018)
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What is NOT an Electronic Bill of Lading (BL)?
An electronic BL is not the same as….

BL PDF Copy

Web BLA copy is only for reference, no legal
value/attributes

BL prep process is done electronically - thedocument is physicalInternet BL

Seaway Bill

Printed at customer premises, legal value only inphysical form

The seaway bill is non-negotiable, ascribing
possession – not ownership

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Why the change to eBL now?
The electronic Bill of Lading product has been around in the market for over 15 years but with limited traction.
What has changed now?

BLOCKCHAIN

Digital Trade (ref OECD)

Provides immutable records ofdocuments through next-gen encryption
and registration of title transfer in adigital ledger.

A growing consensus and pushacross parties in the trade chain toachieve paperless trade forincreased efficiency and risk
mitigation.

Previous platforms / security protocols
are not flexible/strong enough for
scalability

SHIFT
INTERCONNECTIVITY

The advances in cross-platform
interconnectivity (e.g., API)
improves the ease of datatransfer, less configuration.

COVID-19

The pandemic has sped up
digitalization efforts in all industries;
BL processes depending on physicalinteraction were severely disrupted(e.g., India and USA surrender
process; payment release by banks).

Copyright © Ocean Network Express Pte. Ltd. All Rights ReservedBenefits of eBL
Replicating the study done by DCSA (Digital Container Shipping Association) on eBL benefits“As an Exporter, I do not have to print the BL and can save both processing time and courier costs
since I do not have to send the BL to my customer. Since I can provide the documentation details
directly to the shipping line by electronic means, I control the speed of which the process iscompleted.”– Exporters / Forwarders“As an Importer, I do not have to wait for the BL to be received by courier. I can reduce the paperflow and my administrative processes significantly and speed up the cargo release process upon
arrival of the goods.”– Importers“As a documentation manager, I can avoid themanual process of printing and stamping theBL for every customer and achieve economies
of scale by automating the process. This
enables me to provide a better customer
experience – at both origin and destination.”“As an operations manager, I will be able tohave access to real time and reliable data
related to cargo details. This will allow me tofocus on exception management and identify
the shipments where special attention isrequired.”– Shipping Lines“As Customs, I can improve scanning of suspicious
shipments since the documentation is now digitally
available. That allows me to focus resources on wheretariffs and legislation is most complicated.

“As a bank representative, I no longer have to worry about whether the BL is original and valid sincecarriers provide a secure means of issuance. I can automate the process of comparing the BL to thePO or letter of credit and easily verify correctness prior to release of funds. Furthermore, I don’t haveto store physical documents any longer.

– Authorities
Source: 2020, DCSA– BanksReduces significantly risk of fraud (no registered cases in eBL
Copyright © Ocean Network Express Pte. Ltd. All Rights ReservedBenefits of eBL – Cost Savings
Cost Benefits• Courier costs can be eliminated (orsignificantly reduced)

Based on DCSA’s research 100 Mn BLs are issued annually and USD 6 Bn in costs
can be removed through digitization – EVERY YEAR

• Paper administration costs reduced(filing/storage etc.)• Process lead-times can be reduced
resulting in staff efficiency• Compliance (legal and audit) processes
can be improved

Cost Assessment
Estimated global costs in 2020:• USD 12.3 BN*• USD 122 per BL

Potential saving by adopting eBL• Overall – USD 79 per BL• Customer – USD 48 per BL

Impact Assessment Accompanying the Proposal for a Regulation of the European Parliament and of
the Council on electronic freight transport information, European Commission, Ecorys, 2018
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Limitationsof eBL
Despite the benefits ofutilizing electronic Billof Lading, there aresome limitation on theadoption

No Interoperability,No Standards

Regulatory
Gray Areas

TechnicalConstraints

All parties in the chain (shipper, consignee, bank, etc.) must be
signatories in the same platform; if one party is not in theplatform, the document cannot be endorsed or transferred tothat party – the eBL must be switched to paper.

There are no standards for eBL – DCSA is working on it. In
addition to that, there is no cross-platform operability – with theincrease of platforms, scaling becomes harder.

Although the eBL platforms operate under bylaws, in somelocations the local regulation might not provide clarity on thevalidity of eBL.

Cost of implementation, potential risk of cybersecurity(considering the usage of computers, not for the eBL itself) anddemand of technical infrastructure.

(Source: Tricks and Parson, ICC report 2018)
Copyright © Ocean Network Express Pte. Ltd. All Rights ReservedLegality of eBL

Contract ofCarriage

The contract of carriage entered by the carrier is the same
one used for paper Bills of Lading that are governed by
the same applicable law and regulation that applies tothat carrier.

Copyright © Ocean Network Express Pte. Ltd. All Rights ReservedLegality of eBL

Bylaws and Contracting
Establishing the Bylaws

DCSA is working to standardize the bylaws – faster
adoption of new platform (legal perspective)eBL contract parties adhere to a club-system agreement. The platform require allmembers (sellers, buyers, carriers or banks) to sign up to a single contract (thebylaws/rulebook), which is itself subject to a established legal system.
Users agree to treat electronic documentation as the functional and legal
equivalent of paper documents and undertake not to challenge the validity –Protection & Indemnity (P&I).
In case a party is not a member, paper conversion is required.
(e.g., present to customs or terminal).

LEGAL STANDARDSUNCITRAL MLETR
Model law by UN designed to govern electronic
documents transference in Trade. It requires
government adoption into national legislation,and ratification takes time; however, it is been
expedited in several countries.
DCSA is developing industry standards in linewith MLETR + working with government
authorities to encourage its adoption.

P&I approvalPlatforms scrutinized by P&I Club to ensure they are capable of performing thethree functions of a BL. Approval by P&I means platform is able to perform current
functions of paper BL and it is usually a necessary condition to utilize the platform.

Copyright © Ocean Network Express Pte. Ltd. All Rights ReservedLegality of eBL
Bylaws and Contracting

Establishing a contract for eBL issuanceAt this point, based on the bylawsof the platform, both customer and carrier
must be signatory of the eBL platform

There is no need for additionalsignature of agreement and there areNO COSTS incurred from ONE to customer

Copyright © Ocean Network Express Pte. Ltd. All Rights ReservedLegality of eBL – ReferenceeBL legality and ‘grey area’s’Grey AreaseBL in reality• Not have specific considerations for electronic documents• Most countries have available legislation covering• Limited ratification by member states (UNCITRAL)• Specifics on title/ownership and a physical document• Some countries are fully incorporating electronic(COGSA, Hague/Hague Visby)(UK Law)

electronic document exchange(e.g., Brazil, Australia, UAE)

documents coverage on local laws(e.g., Singapore's ETA)

• No reported issues faced due to country law noncompliance

IMPORTANT: The platform bylaws cover the legality of the document; in case a local legislation require paper document, carrier isable to switch the eBL to paper ONLY when presentation to customs is required.
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Fitting eBL functionality in ONE process
Acting mostly as an “eCourier”,
focusing on the documenttransference***Covering the release <> surrenderperiod.

1234

BL Creation& AmendmentBL Issuance& Release

BLEndorsingBLSurrendering

No changes on processing theBL creation and amendment.
The receipt of amendment
request might come inthrough the eBL platform.

eBL is transferredfrom ONE system to theeBL platform; release isfully electronic into the platform.

Endorsing process is fullyelectronic, via eBL platform.
Ownership transfer ensures aunique version of the document

Surrendering process isfully electronic, via eBL
platform. When surrendered,carrier becomes the final ownerof the BL.
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