100% eBL by 2030

The bill of lading (B/L) is one of the most important trade documents in container shipping. It functions as a document of title, receipt for shipped goods and a record of agreed terms and conditions. Currently, stakeholders along complex supply chains must physically pass paper B/Ls from one place to another. This makes for a time-consuming, expensive and environmentally unsustainable trade documentation process.  

Ocean carriers issue around 45 million bills of lading per year. In 2021, only 1.2% were electronic.* However, this 1.2% figure represents usage of “traditional” eBLs, which are PDFs passed electronically. A DCSA standards-based eBL is a framework for the collection, processing and analysis of digital data used in the end-to-end documentation process for carrier-issued B/Ls  (original, straight and to order). 

*DCSA internal member research.

The shipping industry is incredibly complex, involving many stakeholders and governed by a raft of country- and region-specific legislation. Despite this, significant progress has been made towards digitalisation. For example, the FIT Alliance (formed by DCSA, BIMCO, FIATA, ICC, and SWIFT in February 2022) signed a memorandum of understanding to collaborate on the development and adoption of standards to facilitate the digitalisation of international trade. An independent study, conducted for the Alliance, revealed three key factors hindering eBL adoption by industry stakeholders: 

• Concerns about technology, platform and lack of interoperability 
• Insufficient adoption by other stakeholders 
• Legal acceptance of eBL 

By creating open-source digital standards for the end-to-end trade documentation process, and collaborating closely with eBL platform providers as well as FIT Alliance partners to achieve legal and technical interoperability, DCSA is directly and indirectly addressing each of these concerns. With standards as a framework for digitalisation, stakeholders have a clear path forward to eBL adoption and a future empowered by paperless trade for more efficient and sustainable shipping. 

Currently, many international shipping documents are not standardised, and the majority are still paper based, requiring physical hand-off between participants. The manual handover of paper documents is inefficient, expensive and error prone, which contributes to high costs and supply chain bottlenecks.

The benefits of digitalisation have been clear for many years and, indeed, all industries have been touched by automation and digital information exchange. The COVID-19 pandemic shone a light on the limitations of paper-based processes which further increased the call for electronic documentation.

Currently, there is significant momentum towards eBL. Prominent collaborations and initiatives to achieve technological alignment and legal acceptance have formed to facilitate the digital transition. Most notably, the formation of the Future International Trade (FIT) Alliance by DCSA, BIMCO, FIATA, ICC and SWIFT, and the recent announcement by the UK government to legalise electronic trade documentation.

The Electronic Trade Documents Bill, currently making its way through UK parliament*, will legally recognise digital trade documentation as equivalent to paper by mid-2023. This paves the way for widespread adoption of eBL for all sectors and industries using English law as a basis for international contracts, which includes 80% of bills of lading**, much of world trade and several leading ocean carriers.

*Source: https://www.lawcom.gov.uk/electronic-trade-documents-bill-introduced-to-parliament/

**Source: https://www.tradefinanceglobal.com/posts/breaking-uk-introduces-electronic-trade-documents-bill-into-parliament/

End-to-end digitalisation of trade documentation, starting with eBL, will make international trade more efficient, reliable, secure, sustainable and less susceptible to illegal activity. As a result, it will reduce costs across the board while providing a better experience for shippers who will be able to choose an eBL platform based on service levels and capabilities, while maintaining the ability to exchange electronic documentation with carriers, banks and other parties that may use different platforms. Everyone who participates in international trade, the logistics industry as a whole and the planet will realize the benefits.

The FIT Alliance surveyed 278 industry stakeholders across 66 countries, including banks, freight forwarders, carriers, shippers, agents, consignees. When asked what could be achieved through eBLs and wider trade digitalisation, an overwhelming 86% of survey respondents identified increased speed, while 78% cited process efficiencies, 73% improved customer experience, and the same percentage, cost savings. Nearly nine in ten respondents (86%) said they believe eBLs can/will unlock wider trade digitalisation.

A recent McKinsey study estimates that if eBL achieved 100% adoption across the industry, it could unlock around $18bn in gains for the trade ecosystem through faster document handling and reduced human error (among other improvements) plus $30-40 bn in global trade growth, as digitalisation reduces trade friction.* The same study also suggests that paperless trade enabled by 100% eBL adoption can save 28,000 trees per year, equivalent to around 39 football fields of forest.** In addition, research from the Economic and Social Commission for Asia and the Pacific (ESCAP) suggests that fully digitalising regulatory procedures around trade could save between 32 and 86 kg of CO2 equivalents per end-to-end transaction.

100% adoption of the eBL will also help to fight crime. Many customs administration offices across the globe have already implemented digital customs systems for (advanced) cargo screening. However, the submission of that data requires manual “translation” and manual entering of data into customs systems. This is not only burdensome to the private sector, it leads to a loss of data quality for customs and other border authorities who are reliant on that data for protecting society from terrorism, smuggling, fraud and other criminal behaviour. By using an eBL in true digital form, data quality will improve and the data can be real-time. With 100% eBL adoption, the McKinsey study predicts illegal trade could be reduced by 10-15% globally.

*Source: Source: IHS Markit; Lloyd;s List; European Commission; International Chamber of Commerce (ICC); World Bank; UN; McKinsey Global Institute; interviews with subject matter experts (e.g., in customs); assumptions tested in interviews with carriers

**Source: IHS Markit; Lloyd;s List; European Commission; International Chamber of Commerce (ICC); World Bank; UN; McKinsey Global Institute; interviews with subject matter experts (e.g., in customs); assumptions tested in interviews with carriers

DCSA member carriers will be adopting DCSA standards to make 100% eBL possible from end-to-end. Until national legislation and government procedures around the world create full equivalence for electronic documents compared to paper documents, local requirements may be such that documentation for certain parts of the shipment journey need to be printed out. However, carriers will be working on issuing data-based eBLs so that the industry can be ready for entirely paperless transactions. DCSA is also working with governments to help them drive legislation for the acceptance of digital documentation and to resolve situations where documents must still be printed.

The bill of lading is the most important document, hence a very significant starting point. However, there are many documents used in international trade and more work is needed to understand every use case so they can be prioritised for digitalisation to benefit the entire supply chain. Digitalising the eBL, which is the most complex document, will pave the way for digitalisation of all documentation. Our eBL initiative provides a working example of what can be achieved when the entire industry collaborates.

DCSA eBL standards enable a fully electronic Sea Waybill as well. Given it is not a document of title, a Sea Waybill can be exchanged using an eBL platform but does not require one. Any organisation that has implemented the DCSA eBL standards can exchange a standardised electronic Sea Waybill directly with another party that has also implemented a DCSA standards.

In 2020, DCSA began its Digital Trade initiative to facilitate acceptance of a universal eBL. As part of this initiative, DCSA released data and process standards for the booking request and confirmation, shipping instructions and the bill of lading, as well as interface standards including interface definitions. Subsequent releases of DCSA’s Digital Trade initiative will include data and process standards and API definitions for arrival notice and shipment release. DCSA is also expanding the documentation standards to cover non-standard cargo, such as reefer and dangerous goods, and validating the need for other standards, such as Quote to Book. DCSA will communicate further in 2023 regarding its plans in these areas together with steps to enable adoption, which will include a knowledge kit and other tools designed to support shippers, banks, freight forwarders and other supply chain stakeholders.

eBL adoption is a change management initiative, and must be approached as such. That means it will involve multiple parts of each business – commercial, operations, compliance, legal, IT, finance and more. Organisations must also talk to their partners issuing eBLs to further understand what is required. Importantly, a standards-based eBL means stakeholders will only need to implement once to be able to connect with any number of standards-compliant organisations. In this way, managing this change is an investment that will deliver value by lowering costs and increasing efficiency overall.

All documentation processes covered by DCSA standards will be streamlined, including: 

• Booking a shipment 
• Confirming a booking 

• Submitting shipping instructions 
• Issuing a bill of lading 
• Notification of arrival 
• Notification of release