Consultation to inform options for implementing the Model Law on Electronic Transferable Records in Australia - How transferable records are used in Australia (Questions 1–10) - Attorney-General's Department

How transferable records are used in Australia (Questions 1–10)

We are interested in how stakeholders currently use transferable records.

The MLETR confirms that electronic transferable records are just as legally valid as traditional, paper-based transferable records. If enacted, it would therefore give confidence to Australian trade participants that they may use electronic transferable records (like bills of lading and bills of exchange) instead of paper versions, if the relevant MLETR criteria are met.

However, the Australian Government does not necessarily have oversight over how transferable records are used for commercial purposes. We are therefore asking for information about how Australian stakeholders currently use transferable records. This will allow us build a preliminary understanding about what types of records might be included in the scope of any Australian MLETR legislation, and what practices need to be enabled.

Please refer to Parts 2.1-2.2 of the Consultation Paper which inform Questions 1–4.

Current experiences using paper-based transferable records (Questions 5–9)

We are also interested in any available data from stakeholders about the time and costs currently spent processing paper-based transferable records, and any estimate of time or costs savings which might be achievable by using electronic versions of these documents. This will inform our analysis to government on implementation options for the MLETR.

Please refer to Part 2.3 of the Consultation Paper which informs Questions 5–9.

Paper-based transferable record requirements and paperless trade (Question 10)

We are also interested in stakeholder reflections about why they use paper documents in trade generally, and especially whether this is due to the legal uncertainty around electronic transferable records, or to other factors.

Australian law currently does not clearly permit the use of electronic transferable records, which is one of the reasons many people continue to use or require paper trade documents, even those which are not ‘transferable’ (like invoices). This uncertainty may be resolved by the MLETR – however, we understand that other factors like security concerns or cost-barriers may also drive paper-based trade practices.

Please refer to Part 2.4 of the Consultation Paper which informs Question 10.

1. Please identify which of the below documents you most predominantly use in your business activities.

Alternatively, if you do not use any of these documents yourselves, please select those with which you are most familiar, or with which others in your network most predominantly use.

(You may select more than one)

a) bills of exchange b) cheques c) promissory notes d) consignment notes e) bills of lading f) warehouse receipts g) transferable insurance certificates, like marine insurance policies and cargo insurance certificates h) air waybills i) letters of credit j) dock warrants k) dock receipts l) ships delivery orders m) mate’s receipts n) warehouse-keeper’s certificates o) wharfinger’s certificates.

2. Can you identify any other document, used in Australia or by Australian entities, where a person needs to physically possess the document in order to claim the goods or money stated on the document?

Possessing a document Possessing a document

Under the MLETR, a ‘transferable record’ is a type of document, issued on paper, which entitles the holder to claim performance of an obligation, and which can be transferred to another person along with the right to performance.

3. Please describe how you (or your business) use transferable records in your day-to-day business practices.

Please reference any records you identified in Question 1 and Question 2.

Alternatively, if you do not use these records yourself, please describe broadly the ways in which you understand these records are most commonly used.

Guidance Guidance

For example, please describe:

the commercial settings in which you use these records
the entities or people from whom you ordinarily receive these records, and in what circumstances
the entities or people you would give or transfer these records to, including why
the reasons why physical possession or transfer of the paper record is necessary, if relevant
the commercial benefits which come from your use of these records (for example, whether it minimises a particular risk).

4. If you or your business use transferable records in the context of trade, do you use these records in the context of international, inter-state or intra-state trade?

(Please select all that apply)

International trade (goods imported into, or exported from, Australia) Inter-state domestic trade (goods produced in one state for use in a different state) Intra-state domestic trade (goods produced in one state for use in that same state)

5. How many hours per year do you estimate you, or your business, spend in processing paper-based transferable records?

Please refer to the records which you identified in Question 1 and Question 2.

Guidance Guidance

Please provide an estimated or approximate number, for an aggregate of the transferable records you most frequently process, based on available data.

‘Processing’ for these purposes includes arranging couriers, posting, reviewing, completing, amending, accounting for unexpected changes or errors, filing, and other similar actions.

6. What would you estimate to be the average annual financial cost to you, or your business, in processing paper-based transferable records?

Please refer to the records which you identified in Question 1 and Question 2.

Guidance Guidance

Please provide an estimated or approximate amount based on available data. Please account for employee or contractor hourly rates, legal fees, posting or printing, and other similar expenses.

7. If possible, please provide an estimate of how many hours you (or your business) might expect to save per year processing electronic transferable records, compared to paper versions.

If applicable, please also provide a brief description of the basis on which you made this estimate.

8. If possible, please provide an estimate of the financial savings you (or your business) might expect per year processing electronic transferable records, compared to paper versions.

If applicable, please also provide a brief description of the basis on which you made this estimate.

9. How would you assess the impact of using electronic transferable record processes upon your or your business’ customers and consumers?

Please expand on your answer – including, if applicable, a description of the basis on which you made this assessment.

(Please select one)

It would likely result in lowered costs for my customers and consumers. It would likely result in higher costs for my customers and consumers. It would likely not have any effect on costs for my customers and consumers.

Please expand on your response

10. To what extent are your (or your business’) trade documentation processes generally affected by the specific issue of uncertainty about the legal validity of electronic transferable records?

Please expand on your answer. For example, if applicable, please expand on which barriers prevent you from using electronic trade documentation generally.

(Please select one)

Paper transferable record requirements do not affect our processes. We use paper trade documents for several reasons, including paper transferable record requirements. The primary reason we use paper trade documents is paper transferable record requirements.

Please expand on your response