To trade internationally, importers and exporters need trade documents. These documents underpin their participation in both financial and physical supply chains. They are crucial to the many support partners that enable their transactions, from cargo logistics to cross-border payments and trade finance. Realising the benefits of trade process digitalisation relies on governing jurisdictions around the world legally recognising data contained within the electronic transferable records (ETRs) of importers and exporters.
In pursuit of this goal, the International Chamber of Commerce Digital Standards Initiative (ICC DSI) has analysed the legal and technical standards of 36 such trade documents, including eight paper-based ‘documents of title’: bills of exchange, cheques, promissory notes, consignment notes, bills of lading, warehouse receipts, insurance certificates, and air waybills.
To the same end, the United Nations Commission on International Trade Law’s Model Law on Electronic Records aims to enable the use of ETRs as documents of title, both domestically and across borders, by recognising them as legally and functionally equivalent to their conventional paper-based alternatives.
Yet for the full benefit to be felt, another foundational building block must be laid: market participants need to be uniquely and unambiguously identifiable by anyone, anywhere in the world. Currently, businesses use many non-standardised ways to identify themselves. Some do so using only their names. This makes the job of establishing ‘who is who’ both cumbersome and time-consuming. It also complicates the business of transacting between trading parties.
Currently, trade documents contain the mention of many legal entities: importer, exporter, payer, payee, guarantor, carrier, forwarder, and so on. The ICC DSI work revealed that, across the 36 trade documents analysed, up to 42 different parties may require identification. How can the industry deal with that challenge?
The answer lies in establishing a standardised and universal form of trusted organisational identity. The Global Legal Entity Identifier (LEI) System is perfectly suited to play this role. For over a decade, all legal entities have been able to obtain a Legal Entity Identifier (LEI), a unique, globally standardised code which enables anyone, anywhere in the world, to trust that they are who they claim to be. Already, over 2.7 million businesses identify themselves internationally using an LEI. It is a proven, established, and genuinely universal cross-border business identity system backed and overseen by the G20, the FSB, and the Regulatory Oversight Committee (ROC), a group of worldwide public authorities.
In the fight against money laundering, terrorism financing, and other forms of financial crime, more than 200 financial regulators worldwide have already adopted the LEI for legal entities engaging in business-to-government activities. The system is now expanding beyond regulated use and re-focusing on helping organisations use the LEI to bring greater trust, efficiencies, and transparency to business-to-business trades of all kinds. Its already-broad adoption by regulators globally also means it can be easily integrated into current and future regulatory frameworks supporting trade digitalisation.
More recently, GLEIF, the supra-national, not-for-profit guardian of the Global LEI System, has pioneered a new form of digital organisational identity, the verifiable LEI (vLEI), and has established the governance framework and supporting ecosystem, which is now operational today.
The vLEI is transforming the field of organisational identity management and, specifically, how trade document transactions can take place in the digital world. Crucially, it answers the need for automation in entity verification that will equip global supply chains to fight financial crime.
Using decentralised, tamper-resistant cryptography, the vLEI enables any company to digitally bind its LEI code to each transaction, and to further supplement it with verified identity data for the role-holder authorising that transaction. And because the LEI and vLEI systems are based on internationally recognised ISO open data standards, any organisation can utilise their services and enact them across all online platforms. It provides a new, verifiable digital trust layer that sits beneath the conventional information exchanged between supply chain organisations.
GLEIF, which sits as the root-of-trust for all vLEIs, operates independently of geo-political, technological, and commercial influence so, uniquely, the system itself can also be trusted by everyone, everywhere.
Usefully, the Financial Stability Board has already advised that standardised global identifiers, such as the LEI, should be required to enhance cross-border payments, and has recommended national authorities to take steps to support their use.
Now, the LEI and vLEI system can go much further, and instil much-needed confidence amongst trading parties resulting in more transparent and efficient cross-border exchanges of goods and data. This doesn’t just improve the experience for the trading parties, it improves it for everyone involved. It is uniquely positioned to answer the call that can be heard so clearly from all corners of the global digital economy.
This editorial piece was originally published in The Paypers` Global Payments and Fintech Trends Report 2025. The report compiles insights and expertise from leaders representing companies across the financial services spectrum and it delves into the latest innovations and trends in payments and fintech across key markets worldwide.
Alexandre Kech is GLEIF’s CEO, a seasoned executive and thought leader in the fields of digital assets, blockchain, and data standards, with over 25 years of experience in traditional and digital finance.
Gerard Hartsink is Senior Advisor and Chairman Emeritus of the ICC’s Digital Standards Initiative, which is dedicated to advancing the digitalisation of financial and physical international supply chains.
GLEIF is a not-for-profit organisation that makes available the LEI and its digital counterpart the vLEI. GLEIF manages a global partner network to provide trusted services and open data for legal entity identification worldwide.
The ICC Digital Standards Initiative works to accelerate the development of a globally harmonised, digitalised trade environment, to enable dynamic, sustainable, inclusive growth. It aims to progress regulatory and institutional reform by harmonisation and adoption of legal and technical standards.
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