Commentary on sections of the Act Section 4: Change of form or medium Requirements for a valid change of form
Section 4(1) provides for the change of medium (or conversion) of a trade document from electronic to paper form and from paper to electronic form, provided two conditions are met.
	Section 4(1)(a) requires a statement that the document has been converted to be included in the document in its new form. For example, a document converted from paper to electronic form must contain, in that electronic form, a statement that it has been converted from paper. The statement need only specify that the document has been converted or changed from paper to electronic form; it need not contain additional details. The purpose of this requirement is to ensure that the transferee of a trade document, the medium of which has been changed or converted, is aware that the document was originally issued in a different form or medium. This puts the transferee on notice of a change of medium, helps maintain an audit trail of the document, and enables the transferee to ascertain the document’s genuineness and compatibility with any specific requirements.
	Section 4(1)(b) requires any contractual or other requirements relating to the conversion of the document to be complied with. Systems currently in use, which provide electronic alternatives to paper trade documents, generally operate in accordance with underlying contractual provisions governing a change of medium. The issuer, as well as the person in possession, would generally need to agree to the change of medium. The purpose of this requirement is to ensure that such arrangements are not rendered redundant or overridden. The intention is to ensure that a change of medium is permissible at law, but not to establish how or by whom it may be done.