Overview of the Act
The Act gives effect to the recommendations made by the Law Commission of England and Wales in its report on Electronic Trade Documents, published on 16 March 2022. 1 The Act is concerned with certain types of documents used in trade and trade finance whose functionality depends on their being capable of being (physically) possessed. Before the passing of the Act, the law in the United Kingdom did not recognise the possibility of possessing electronic documents; possession was associated only with tangible assets. These documents could not therefore be used effectively in electronic form.
	The Act gives effect to the recommendation of the Law Commission for England and Wales to allow for the legal recognition of such documents in electronic form. It does so by providing that a trade document in electronic form that satisfies the criteria set out in the Act (that is, an "electronic trade document") is capable of possession. In providing for the possessability of electronic trade documents that fall within its scope, the Act enables such documents to have the same legal recognition and functionality as their paper counterparts. Furthermore, the Act sets out provisions relating to the use of electronic trade documents in practice, such as indorsement and change of medium between electronic and paper trade documents. It also repeals sections 1(5) and 1(6) of the Carriage of Goods by Sea Act 1992, and makes consequential amendments to section 89B(2) of the Bills of Exchange Act 1882.