Recent proposed changes to the Singapore Electronic Transactions Act would allow for the digitalization of cross-border trade documents and other important legal documents.
The Singapore Parliament introduced various amendments to the Electronic Transactions Act (ETA) on 4 January 2021. The ETA aims to facilitate electronic transactions in Singapore and provides for the legal recognition and use of electronic signatures and records, thereby giving predictability and certainty to electronic transactions. The recent amendments to the ETA allow for the digitalization of cross-border trade documents such as bills of exchange, promissory notes and bills of lading to be legally recognized and aim to reduce the time and money required to process a huge amount of paperwork. The changes will take effect on a future date appointed by the relevant ministry.
As part of the government’s broader digitalization journey, the Ministry of Social and Family Development (MSF) has also proposed to digitalize the lasting power of attorney (LPA), which allows an appointed person to make medical and financial decisions on another’s behalf should the latter lose mental capacity.
Broad Adoption of Model Law
Several new provisions have been introduced to the ETA for the purpose of adopting the UNCITRAL Model Law on Electronic Transferable Records (Model Law). The Model Law aims to enable the legal use of electronic transferable records both domestically and across borders. It applies to electronic transferable records that are functionally equivalent to transferable documents or instruments.
Transferable documents or instruments are paper-based documents or instruments that entitle the holder to claim the performance of the obligation indicated therein and that allow the transfer of the claim to that performance by transferring possession of the document or instrument. Examples of transferable documents or instruments typically include bills of lading, bills of exchange, promissory notes, and warehouse receipts.
Digitalization of Cross-Border Documents Added to ETA’s Scope of Operation
Currently, most of maritime trade involves the use of physical bills of lading, which are legal and commercial documents providing evidence for the contract of carriage, receipt, and ownership of goods for a cargo shipment. With the intricacies of maritime trade, the paper trail typically runs up to hundreds of pages for a single transaction, which consumes a lot of time and money.
Following the amendments to the ETA, electronic versions of cross-border documents such as bills of exchange, bills of lading, and promissory notes will have legal effect.
Parliament also seeks to digitalize the LPA with proposed amendments to the Mental Capacity Act. Currently, only hard copies of LPAs are accepted.
The proposed amendments to the Mental Capacity Act will do the following:
If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers, who are solicitors of Morgan Lewis Stamford LLC, a Singapore law corporation affiliated with Morgan, Lewis & Bockius LLP:
 Cap 88, 2011 Rev. Ed.
 Cap 177A, 2010 Rev. Ed.