Two companies have completed a successful trial with CargoX’s blockchain-based Smart Bill of Lading Solution.
CargoX claims trials with its Smart B/L involving G2 Ocean and Manuchar “show the paper Bill of Lading is ready for retirement”. CargoX is a Solvenia-based start up with a blockchain-based Bill of Lading platform called “Smart B/L” that completes the document ownership transfer securely and reliably within minutes. Its background can be read in our previous coverage.
The trials involved G2 Ocean, a Norway-based joint venture between Gearbulk and Grieg Star specializsng in bulk and breakbulk cargoes, and Manuchar NV, a trading & distribution company with focus on emerging markets.
CargoX described the tests as follows: “The two companies concluded their test of the blockchain-based B/L system this April. During the test, they transferred ownership of goods with shipments traveling from China to Peru…In total we have completed five separate pilot shipments, with five Smart Bills of Lading. They departed the port of loading Xingang China on the 5th of April 2019, and reached the port of discharge, Callao, Peru, on the 26th of May 2019. The distance between ports is 9,504 nautical miles. The importer received the Smart B/ Ls after a couple of minutes”.
Stefan Kukman, Founder and CEO, CargoX confirmed to WorldCargo News that no traditional Bill of Lading documents were sent as a backup. Rune Birkeland, CEO at G2 Ocean, is excited about the possibility to retire paper Bills of Lading, which he said are “already considered a historic artifact”. The Smart B/L solution, he continued, “gives both us and our clients the power of a modern, reliable, and efficient tool. It will bring cost optimisation and improved data security into their processes. The document transaction reliability in this system is indisputable.”
"G2 Ocean consider Smart Contracts based on Distributed Ledgers or blockchain as a unique opportunity to digitalize and automate manual processes between its clients and subcontractors,” Leif Arne Strømmen, Vice President of Innovation G2 Ocean added. “The Bill of Lading is one of two priority areas in 2019 using blockchain technology. Based on these successful pilots, our next step will be to scale this up and offer it’s as a value-added service to our clients”.
Bart Troubleyn, COO of Manuchar, also endorsed the Smart B/L. “The implementation of new technologies is essential to establish and maintain our leading position in terms of cost-efficient sourcing & supply chain solutions for our customers. We focus on technologies that go beyond the hype and deliver real benefits in terms of speed, efficiency and the quality of service. That is exactly why this successful Smart B/L pilot is such an important next step in Manuchar’s digital transformation program: it provides real value. We thank G2 Ocean and CargoX for the excellent collaboration in achieving this success”.
One issue that has yet to be resolved around using a blockchain to transfer a Bill of Lading is insurance coverage. The key issue here is approval from the P&I Clubs, which have approved some electronic Bills of Lading using other technology previously. In September last year CargoX told WorldCargo News it had started the approval process for its blockchain system, which is continuing. “We have provided the P&I clubs with extended information and additional explanations for mutually satisfactory outcomes. We are therefore in the final stage of the process of P&I clubs approval acquisition,” Kukman advised this week.