the blockchain bill of lading or the smart contract basis of the system where selfimplementation according to a set of injected instructions is the framework under
which it operates. Given that the system precludes any control by a particular entity
in the chain, the question of liability become crucial in the event of system failure.
There are those who fallaciously believe that coding is error-free. That is not the
case; also, platforms that provide for the system may suffer failure of operation.
There may be problems relating to programming of the smart contract. Erroneous
programming inevitably leads to liability issues involving contributory negligence of
parties concerned and associated problems of apportionment of liability. If, for
example, there is a fire outbreak in a hold of a ship, destroying the cargo, it may
be allegedly due to negligence of the shipboard crew, or also attributable to the
shipper not providing adequate information to the carrier on the inflammable
characteristics of the cargo. Given the rigidity inherent in the parameters of a
blockchain bill of lading, it may be impossible to quantify and apportion liability
if both parties are found to be at fault.
6.3.7 Security and Cybercrime Risks
No doubt security precautions are built into the blockchain bill of lading, but they
still involve such things as the need for signatures and logging in by each participant
in the transaction. As tamper-proof as the system might seem to be, there is always
the possibility of cybercriminals intervening and causing major havoc as has been
proven in instances of theft of cryptocurrencies.
7 Conclusion: Proposal for Consideration
Blockchain technology has evolved as a revolutionary development in the current
climate of economic upturns and downturns. It is seemingly adaptable to global trade
and commerce to bring about positive changes by providing a secure device to pay
for goods in a seamless fashion and, in the case of blockchain bills of lading, can
transfer title through the utilization of a smart contract overlying the blockchain.
Unfortunately, however, contract clauses cannot be incorporated into its architecture, and therefore, blockchain is unable to deal with events occurring during the
actual movement of goods. In a contract for the sale of goods as well as a carriage
contract, an important feature of the terms of these contracts is how potential
eventualities are to be handled during their performance.
The engagement of blockchain technology in the business of sale of goods and
their maritime carriage, whether through charterparties or simply by the use of bills
of lading, is still in a state of infancy despite the huge technological advances
engendered by the system. Several significant matters of concern have remained
unaddressed in blockchain use given the absence of appropriate contract clauses.
Typical examples are those concerning force majeure and dispute resolution
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H. Liu
which it operates. Given that the system precludes any control by a particular entity
in the chain, the question of liability become crucial in the event of system failure.
There are those who fallaciously believe that coding is error-free. That is not the
case; also, platforms that provide for the system may suffer failure of operation.
There may be problems relating to programming of the smart contract. Erroneous
programming inevitably leads to liability issues involving contributory negligence of
parties concerned and associated problems of apportionment of liability. If, for
example, there is a fire outbreak in a hold of a ship, destroying the cargo, it may
be allegedly due to negligence of the shipboard crew, or also attributable to the
shipper not providing adequate information to the carrier on the inflammable
characteristics of the cargo. Given the rigidity inherent in the parameters of a
blockchain bill of lading, it may be impossible to quantify and apportion liability
if both parties are found to be at fault.
6.3.7 Security and Cybercrime Risks
No doubt security precautions are built into the blockchain bill of lading, but they
still involve such things as the need for signatures and logging in by each participant
in the transaction. As tamper-proof as the system might seem to be, there is always
the possibility of cybercriminals intervening and causing major havoc as has been
proven in instances of theft of cryptocurrencies.
7 Conclusion: Proposal for Consideration
Blockchain technology has evolved as a revolutionary development in the current
climate of economic upturns and downturns. It is seemingly adaptable to global trade
and commerce to bring about positive changes by providing a secure device to pay
for goods in a seamless fashion and, in the case of blockchain bills of lading, can
transfer title through the utilization of a smart contract overlying the blockchain.
Unfortunately, however, contract clauses cannot be incorporated into its architecture, and therefore, blockchain is unable to deal with events occurring during the
actual movement of goods. In a contract for the sale of goods as well as a carriage
contract, an important feature of the terms of these contracts is how potential
eventualities are to be handled during their performance.
The engagement of blockchain technology in the business of sale of goods and
their maritime carriage, whether through charterparties or simply by the use of bills
of lading, is still in a state of infancy despite the huge technological advances
engendered by the system. Several significant matters of concern have remained
unaddressed in blockchain use given the absence of appropriate contract clauses.
Typical examples are those concerning force majeure and dispute resolution
432
H. Liu