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The Roadmap to Digitalise UK Trade

Making Trade Cheaper, Faster, Simpler, Secure, Sustainable

Delivering on the government mission to drive growth and productivity

ICC United Kingdom, International Centre for Digital Trade and Innovation (iC4DTI)

Digitalising the trade ecosystem

What has changed?

Trade digitalisation has been a topic of conversation for many years, so what has changed and why are we now calling on government and industry to take action? Despite much investment in digitalising customs and trade facilitation processes, worldwide only 1–2% of trade documents are handled in digital (data) form. Trade platforms and systems remain fragmented and disconnected due to a lack of trade data standardisation. This situation is changing. Companies can digitalise trade today in ways that were not possible only a few months ago. The legal environment has changed, technology solutions are available and more and more case studies are proving the benefits.

The ICC Digital Standards Initiative (DSI)

Launched in 2020, DSI for the first time provided an international focal point to coordinate digitalisation efforts across governments, institutions, standards bodies and industry. Its role is critical with a goal to enable 60–80% of world trade to be digitalised by the end of 2026. ICC’s Key Trade Documents and Data Elements toolkit now enables companies to map all documentary processes. The ICC Reliable Systems Framework provides a globally recognised standard to support legal reforms and digitalised trade.

For more information visit dsi.iccwbo.org

Legal infrastructure

Antiquated laws, dating back to the 1800s, have been a major block to trade information being handled in digital form. UNCITRAL Model Laws on e-contracts, e-payments, e-signatures and e-transactions have created an interoperable legal framework for digitalised trade for the first time. G7, G20, the World Trade Organization, United Nations, ASEAN and Commonwealth are just some of the institutions and trade blocs working with ICC to actively remove legal barriers. The Electronic Trade Documents Act 2023 has changed the game with English law now enabling 80% of bills of lading, 60% of global trade finance and the lion share of shipping, insurance and commodity trade to be digitalised. Today, 80–90% of all trade transactions can be digitalised with governments covering 80% of world trade now committed to remove legal barriers to electronic transactions.

For more information on the status of legal reforms visit digitalizetrade.org

Data Standards infrastructure

A lack of common, interoperable data standards in trade and too many competing data standards have prevented trade information from flowing across platforms, systems and jurisdictions in the way we need for future trade. Of the 35–40 documents in trade, ICC has mapped every data point and every data field and format to prepare the ground for data standards alignment. When complete, this work will, for the first time, enable trade information to flow in standard formats across platforms, systems, supply chains and jurisdictions.

Policy environment

In the past, trade digitalisation has not been well understood by governments with an over focus on customs and not enough focus on enabling the whole trade ecosystem to be digitalised. This is changing with digitalisation now front and centre of trade strategies all over the world.

Industry

There has been significant progress in the shift to digitalised trade with companies all over the world benefiting from electronic transactions. The Digital Container Shipping Association and Bimco are on track to stop using paper bills of lading by 2030. Internationally, the use of e-bills of lading (eBL) has more than doubled since 2023 with adoption rates amongst the largest commodity traders of over 60%.

Training

The ICC Academy now provides two online training courses — MLETR Foundations and Certificate on Digital Trade Strategy.

For more information on training courses visit https://icc.academy

Why we need a roadmap

Digitalising trade requires all stakeholders to take action — buyers, sellers, government, investors, logistics, ports, carriers, financiers, insurers, lawyers, regulators, technology providers… The purpose of this roadmap is to provide a framework for decision makers to inform decisions on what to do and when to take action.

How we transition to a data-driven trading system

Guide: Where to get started

Delivering growth and productivity

The government is playing a leading role as a global champion to digitalise trade. Trade digitalisation delivers a wide range of government priorities to unlock growth, improve productivity, secure supply chains and foster innovation.

Trade digitalisation provides an opportunity to improve the environment, remove export and market access barriers, reduce border friction and improve access to finance to fund trade.

Trade digitalisation provides a solution to a host of government priorities including:

Legal reforms — leveraging the Electronic Trade Documents Act and Digital Assets Bill to enable cheaper, faster, simpler trade; position the UK as a global legal centre for future trade.

Industrial strategy — six priority sectors are beneficiaries of digitalised trade (Defence, Advanced Manufacturing, Greentech, business/professional/financial services, tech).

Trade strategy — enabling global trade; promoting international cooperation; making trade cheaper, faster, simpler and more sustainable; improving access to SME trade finance.

SME Digital Adoption Task Force — enabling SMEs to adopt digital tech for international trade.

FTA utilisation — enabling 40% of UK FTAs with digital chapters (estimated by OECD to double the value of UK trade).

Increasing emerging market trade — making trade cheaper, faster, simpler, sustainable with Asia (ASEAN, APEC, CPTPP), Africa (supporting AfCFTA), Commonwealth, Middle East (GCC FTA).

Supporting priority programmes — delivering the world’s most effective border, freeport innovation, National Wealth Fund, Net Zero/biodiversity strategies (sustainable global supply chains, Scope III commitments).

Reducing fraud and tax evasion — shutting fraudsters out of the trade system, using smart API technology to connect HMRC with financial institutions.

Aligning to multilateral trade commitments and ambitions — G7, G20, WTO, CPTPP, APEC, ASEAN, Commonwealth.

Supporting the Regulation Innovation Office — removing barriers to growth created by paperwork and bureaucracy.

Meeting the recommendations of the government’s “Task and Finish” Group — better data management, supporting Critical Imports Strategy.

Securonomics — bringing together of legislation, policy, standards and technology.

Office for Digital Identities and Attributes/Companies House review — establishing interoperable digital identity infrastructure, aligning UK to global system.

De-risking private sector investment — catalysing the transition to a data-driven trading system, unlocking $10 trillion in global trade growth, supporting the International Centre for Digital Trade and Innovation / ICC United Kingdom — Corporate and Trade Digitalisation Taskforces.

The benefits

National and international

Sources: ‘Creating a Modern Digital Trade Ecosystem; the economic case to reform UK law and align to the UNCITRAL Model Law on Electronic Transferrable Records (MLETR)’, ICC United Kingdom, 2021. ‘Impact assessment of the Electronic Trade Documents Bill’, 2022.

Sources: ‘G7 | Creating A Modern Digital Trade Ecosystem Cutting The Cost And Complexity of Trade’, ICC United Kingdom, 2021. Quantitative Analysis of the Move to Paperless Trade’, The Commonwealth, 2023. ‘Study on the ASEAN Digital Economy Framework Agreement’ Boston Consulting Group, 2023.

For companies

Since the Electronic Trade Documents Act (ETDA) came into force, we have seen transformational improvements to the way companies are trading. The opportunity now is to scale these benefits to all trading companies.

Trade digitalisation and faster e-transactions benefit companies of all sizes and sectors in a myriad of ways. These include.

Full list of company benefits

Finance benefits

Why this matters for sustainability

Digitalising trade will enable companies to get ‘match fit’ for a future world where there will be an expectation to have full visibility and transparency across global supply chains in line with Scope III commitments in the Paris Climate Accord and Global Biodiversity Framework. Current trade systems don’t enable this — they are fragmented, disconnected with many processes still paper-based. Key trade information is inaccessible but can be better utilised for supply chain reporting and decision making if using interoperable data systems. Such information includes what the goods are, where they are geographically, who owns them, who is paying for them.

Replacing paper-based systems enables companies to better use data to reduce regulatory reporting risk, age cash, reduce costs, improve efficiencies and make better, more informed decisions with an end-to-end data trail.

Digitalising trade enables companies to demonstrate how they are delivering on 12 of the UN Sustainable Development Goals and meeting ESG commitments. Data-driven systems improve reporting accuracy and reduce the risk of ‘greenwashing’ accusations.

Making it happen

Action plan for government and industry

Explainer

Digitalisation will not happen unless we all play a role in making it happen. The purpose of this section is to set out practical actions for government and business to ensure UK trade is able to realise the benefits that digitalisation will deliver.

The following action plans are divided into roles and responsibilities under three categories:

Incentivise — for Government to do
Catalyse — for ICC United Kingdom/International Centre for Digital Trade and Innovation (iC4DTI) to do
Lead — for buyers and sellers (cargo owners) to do

Incentivise

Recommendations to government

Incentivise

Recommendations to government

Catalyse

For ICC United Kingdom/International Centre for Digital Trade and Innovation to do

Lead

For buyers and sellers to do

Trade corridors

Explainer

The purpose of this section is to highlight which trade corridors companies can undertake e-transactions under public law.

Transactions on commercial law can take place in all corridors through existing solutions providers.

The slides show where UK companies can e-transact under the Electronic Trade Documents Act and/or Free Trade Agreements. Where both the UK and corresponding government accept e-transactions under public law. Information on the value of UK exports to these countries is also provided.

Note the information provided is intended to demonstrate the scale and pace of change to legal infrastructure over the next three years.

For accurate, up to date legal information check the ICC/UNESCAP MLETR Tracker

2024 countries with no legal barriers