PH ratifies UN treaty facilitating use of e-communications in global trade

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UNECC to facilitate electronic communications
The ratification of the UN Convention on the Use of Electronic Communications in International Contracts (UNECC) ensures concluded contracts and other digital communication exchanges are as valid and enforceable as their traditional paper-based equivalents. Image by StartupStockPhotos from Pixabay
  • President Rodrigo Duterte has signed the instrument of ratification of UN treaty that bolsters cross-border digital trade
  • The ratification of the UN Convention on the Use of Electronic Communications in International Contracts (UNECC) will facilitate use of electronic communications in international trade
  • The Convention ensures concluded contracts and other digital communication exchanges are as valid and enforceable as their traditional paper-based equivalents
  • The UNECC creates a modern and enabling legal framework for electronic commercial transactions

The recent ratification by the Philippines of the United Nations (UN) Convention on the Use of Electronic Communications in International Contracts (UNECC) is expected to facilitate use of electronic communications in international trade.

The Convention ensures that concluded contracts and other digital communication exchanges are as valid and enforceable as their traditional paper-based equivalents.

President Rodrigo Duterte recently signed the instrument of ratification of the UNECC.

Early this year, the Department of Foreign Affairs (DFA) endorsed to Duterte the UNECC for ratification, after receiving certificates of concurrence from the Bangko Sentral ng Pilipinas, Department of Budget and Management, Department of Information and Communications Technology, Department of Finance, Department of Justice, Department of Science and Technology, and the Department of Trade and Industry (DTI).

“Ratification of this treaty is important because it sends a strong signal on the Philippines’ readiness to adopt a modern and predictable legal regime for international electronic contracts. It will further bolster our efforts to promote cross-border transactions,” Trade Secretary Ramon Lopez said in a statement.

Digital readiness

DTI noted that in the 2021 UN Global Survey on Digital and Sustainable Trade Facilitation, the Philippines scored 86.02% higher than the Southeast Asia average of 74.29%.

In March 2022, the UN Economic and Social Commission for Asia and the Pacific (ESCAP) conducted a Legal Readiness Assessment for Cross-Border Paperless Trade report and recommended the accession by the Philippines to the UNECC to govern the legal recognition of cross-border electronic transactions, while domestic law will continue to govern domestic transactions.

READ: BOC launches UNESCAP report on PH cross-border trade readiness

The UNECC creates a modern and enabling legal framework for electronic commercial exchange as it reinforces the level of uniformity in electronic transactions by establishing common rules across jurisdictions, Lopez added.

According to the UN Commission on International Trade Law (UNCITRAL), the UNECC is an enabling treaty whose effect is to remove formal obstacles by establishing equivalence between electronic and written form.

The treaty also serves the following purposes for further facilitating the use of electronic communications in international trade, as follows:

  • Strengthen the harmonization of rules regarding e-commerce;
  • Foster uniformity in the domestic enactment of UNCITRAL model laws relating to e-commerce; and
  • Update and complement certain provisions of those model laws in light of recent practice.

UNECC was adopted on November 23, 2005 and entered into force on March 1, 2013. The Philippines signed the Convention on September 25, 2007.

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