Electronic Trade Documents Bill to bring global trade into the 21st century

This year, the UK is set to become the first G7 country to pass a ground-breaking piece of legislation, which has the potential to transform global trade as we know it.

The Electronic Trade Documents Bill, which has now completed its second reading in the House of Lords, will allow electronic trade documents to have the same legal outcomes as their paper equivalents.

Why does this matter? In a digitally led world of ChatGPT, Uber and Amazon, it is almost impossible to imagine a paper-based system where around 28.5 billion trade documents, including bills of lading and bills of exchange, are physically printed and flown around the world daily, because electronic forms of trade documentation can’t currently be used in the same way as their paper equivalents. 

To retrieve traded goods, one must physically visit ports with paper documentation in hand – highlighting how a 21st century UK is having to comply with 19th century legislation. Without this vital change, trade will continue to be paper-based, costly, complex and time-consuming.

Trade has formed the foundation for HSBC since 1865 and our global footprint enables us to facilitate $799bn of trade annually. As the world’s leading bank for international trade finance, we firmly believe that the future of international business banking is digital and sustainable. 

As the world moves forward digitally, it is only right that trade follows suit. The UK’s international trade is already worth more than £1.4tn – removing this legal obstacle to electronic versions of trade documents is expected to provide a £1.14bn boost to UK business over 10 years. 

This change is vital for ambitious UK businesses who are eager to pursue international growth. As highlighted in Going Global for Growth, HSBC UK’s latest research into businesses’ attitudes towards international growth and expansion, 53% of the 2100 businesses surveyed said international sales were critical to their growth. In addition, 8% – the equivalent of 448,000 UK businesses – expressed their ambitions to start trading internationally. 

Given the clear ambition and drive displayed by UK businesses to trade internationally, this change in legislation has never been more necessary – by recognising digital documents, trade will be easier, faster and more secure for businesses. Huge environmental benefits will also be realised from the reduced use of paper and emissions from couriers.

The UK has an excellent opportunity to become the first G7 country to pioneer this groundbreaking legislation. Unlocking this final piece of the puzzle will enable UK businesses to flourish and realise their global trade ambitions.

Laura Murray is the interim head of global trade and receivables finance at HSBC UK.