Evaluating the Use of Blockchain Technology in Improving the Inefficiencies related to Bill of Lading for Containers in the Shipping Industry: A Comparative of Case Studies

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CURTIN UNIVERSITY
SCHOOL OF INFORMATION SYSTEMS
Evaluating the Use of Blockchain Technology in
Improving the Inefficiencies related to Bill of
Lading for Containers in the Shipping Industry:
A Comparative of Case Studies
ADITYA CHILKA
Dr Albert Tan
February 2018
This dissertation is submitted in partial fulfilment of the conditions for completion of
the degree of …Master in Supply Chain Management… from Curtin University.

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Abstract
Current research is about Blockchain technology and how this technology is helping
in improving the inefficiencies in the present shipping line. The study aims to
evaluate the use of Blockchain technology in resolving the Bill of Lading issue as
well as improving the Security, Transparency, Traceability in the Container Shipping
Industry with the help of case studies.
The research critically evaluates and examine the various concepts, terms, issues and
the barriers to the adoption of Blockchain technology to Shipping Industry and Bill of
Lading.
The research uses qualitative analyses with the help of comparative case studies
between 4 companies. The first comparison between International Business Machines
(IBM) Corporation which are the pioneer in the industry for Blockchain technology
for Supply Chain (Maerk) and Accenture which is the second position, in improving
efficiencies in Supply Chain ecosystems. The second part of the research is a
Comparative between two case studies one being BoLero-Electronic Bill of Lading
and the other being SWIFT-The Society for Worldwide Interbank Financial
Telecommunication for trade finance. The researcher also conducts comparative
analyses of Paper-based Bill of Lading vs. Electronic Bill of Lading vs. Blockchain
based Bill of Lading IBM in removing inadequacies in Supply Chain ecosystem for
containers in the Shipping Industry.
The research finds that IBM with the help of its immutable public permission
Blockchain technology is a leader in the current market. Moreover, seems more
suitable for critical stakeholders for adopting Blockchain technology in Shipping
Industry especially in relation Supply Chain issues related to Bill of Lading as
compared to Accenture’s, editable private Blockchain which seems more suitable for
the finance industry. The research finds that Blockchain technology seems promising
in solving many issues and inefficiencies in the Paper-based Bill of Lading and
Electronic Bill of Lading.
The research provides suggestions to key stakeholders such as vendors, shipping
liners, etc. in adopting suitable Blockchain technology based on the analysis above as
an improvement over the Paper-based and Electronic Bill of Lading.

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Acknowledgements
I would like to thank all those who have helped me in the completion of research.
First and foremost, I would like to thank my teacher Dr Albert Tan at Curtin
University, who provided me with knowledge of various subjects and set the base
knowledge much needed for understanding various aspects of research.
Mainly I would like to thank my supervisor who at every step of research right from
selection of a suitable topic till the completion guided me in the completion of this
research.
I would like to thank all my friends with whom I discussed topics and gained more
understanding and insight which proved helpful in research.
I would like to thank various companies selected in research who are doing such
commendable work in the field of Blockchain technology and has valuable
information put on their websites and other places which helped me in gaining the
content understanding much needed.
I would like to thank my parents and relatives who supported me financially and
emotionally during my course and research work.

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LIST OF FIGURES
FIGURE 1 BUILDING A BLOCKCHAIN ...........................................................................19
FIGURE 2 KEY CONCEPTS OF BLOCKCHAIN ................................................................20
FIGURE 3 DISTRIBUTED BLOCKCHAIN.........................................................................21
FIGURE 4 DISTRIBUTED LEDGER SYSTEM ...................................................................21
FIGURE 5 TYPES OF BLOCKCHAIN...............................................................................23
FIGURE 6 FEATURES AND ADVANTAGES OF BLOCKCHAIN..........................................24
FIGURE 7 ISSUES RELATED TO PAPER-BASED BILL OF LADING ...................................45
FIGURE 8 BLOCKCHAIN TRACING CONTAINER JOURNEY IMPROVES TRANSPARENCY
AND SECURITY....................................................................................................45
FIGURE 9 BLOCKCHAIN SMART CONTRACTS IN ACCENTURE......................................52
FIGURE 10 ISSUES AND RISKS IN PAPER-BASED BILL OF LADING................................55
FIGURE 12 ISSUES IN ADOPTION OF ELECTRONIC BILL OF LADING..............................65
FIGURE 13 BENEFITS OF BLOCKCHAIN BILL OF LADING .............................................65
FIGURE 14 BLOCKCHAIN JOURNEY OF BILL OF LADING..............................................66
FIGURE 15 BLOCKCHAIN SMART CONTRACTS ADDRESSING TRADE FINANCE ISSUE...69
FIGURE 16 BLOCKCHAIN BASED SMART BOL .............................................................82
Figure 17 Letter of Credit Before Blockchain
Implementation…………………………………………………………………......82
Figure 18 Letter of Credit After Blockchain Implementation……………………...83
Figure 19 Customs Process Before Blockchain
Implementation…………………..............................................................................84
Figure 20 Customs Process After Blockchain
Implementation…………………………………………………………………......84

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Table of Contents
CURTIN UNIVERSITY ......................................................................................................... 1
1 INTRODUCTION AND BACKGROUND ........................................................................ 7
1.1 Introduction .............................................................................................................. 7
1.2 Background and Context .......................................................................................... 7
1.3 Problem Statement ............................................................................................... 9
1.4 Structure of Dissertation ...................................................................................... 10
2 SIGNIFICANCE OF RESEARCH .................................................................................. 12
3 LITERATURE REVIEW .............................................................................................. 13
3.1 Introduction .......................................................................................................... 13
3.2 Shipping Industry .................................................................................................... 13
3.3 Issues and Challenges in Supply Chain for Shipping Industry ............................... 13
3.4 Blockchain ............................................................................................................... 18
3.5 Advantages of Blockchain in the Shipping Industry ................................................ 24
3.6 Smart Contracts ...................................................................................................... 30
3.7 Challenges of Blockchain technology ...................................................................... 31
3.8 Summary ................................................................................................................. 34
4 RESEARCH QUESTIONS ........................................................................................... 35
5 RESEARCH METHODOLOGY AND DESIGN ............................................................... 36
5.1 Research Design ...................................................................................................... 36
5.2 Research Philosophy ............................................................................................... 36
5.3 Research Approach ................................................................................................. 37
5.4 Research Process .................................................................................................... 38
5.5 Research Strategy ................................................................................................... 38
5.2 Data Type (Qualitative) and Analysis ...................................................................... 40
5.3 Research Ethics ....................................................................................................... 42
6 DATA PRESENTATION AND ANALYSIS ..................................................................... 44
6.1 Case 1- Digitalised Blockchain Maersk (IBM Blockchain) ....................................... 44
IBM Blockchain Process example consignment of Roses .............................................. 45
6.2 Case 2- Accenture Blockchain ................................................................................. 50
6.3 Issues related to Paper-based Bill of Lading ........................................................... 54
6.4 Case 3 -BoLero (Electronic Bill of Lading) ................................................................ 57
6.5 Case 4- SWIFT ......................................................................................................... 59
6.6 Benefits of Electronic Bill of Lading over Paper-based Bill of Lading ...................... 61
6.7 Issues in Electronic Bill of Lading ............................................................................ 62
6.8 How Blockchain based BL is improvement over Electronic Bill of Lading ............... 63
6.9 Benefits of Blockchain over other existing Systems ................................................ 65
6.10 Challenges of Trade Finance resolved by Blockchain Smart Contracts ................. 68
6.11 Comparative Case Study of Paper-based Bill of Lading Vs Electronic Bill of Lading
and Blockchain Technology in Shipping Industry .......................................................... 71
7 RESEARCH FINDINGS AND CONCLUSION ................................................................. 86
7.1 Research Findings ................................................................................................... 86
7.2 Research Conclusion ............................................................................................... 89
7.3 Research Recommendations ................................................................................... 92
8 LIMITATIONS AND AREA OF FURTHER RESEARCH ................................................... 94

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9 GLOSSARY OF TERMS ............................................................................................. 95
10 REFERENCES ........................................................................................................... 96

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1 Introduction and Background
1.1 Introduction
According to IBM (2017a), the annual turnover of the international Shipping
Industry is around $4 trillion with almost 80% goods being transported by the ocean
vessel. Most of the delivery activity, shipment, and delivery tracking estimated time
of delivery, seeking customer signoff on the same and from the port and customs
officers are all manual paper process. The annual cost of the global trade is around
$1.8 trillion which includes saving of about 10% from some well-managed process.
The overall magnitude and cost of the total trade value have been increasing with a
lot of difficulties. In the year 2007, 13.5 trillion employees were recruited, who
worked on $4trillion goods. With the increase in magnitude and cost of the total
trade value and world trade ecosystem, there have been more difficulties as well
(Sadouskaya, 2017). There is a need to reduce the cost and time involved in the
shipping of goods along with paperwork and with the implementation of the new
process, the price shall decrease by around 80%. The World Economic Forum says
that, once the Supply Chain barriers reduce and the transportation process becomes
transparent and digitalized, there will be about 15% rise in overall trade which shall
also result in economic development. Liner freight comprised of around 67% of
world trade in the past decade. The primary element is to reduce the time of delivery
along with cutting the time taken for information about the container to reach the
port and sail efficiently (Riley, 2017). Bernard Hoekman, then the director of the
World Bank’s International Trade department said in the year 2013 in a
communication along with the report of WEF in coordination with Bian & Company
and the World Bank that came out along with the Davos forum said that more than
the import charges and duty the Supply Chain barriers act as a significant drawback
for trade. Reducing these barriers shall not only reduce the cost of goods but also
help in economic development by generating more employment opportunities.
1.2 Background and Context
According to (IBM, 2018c), IBM, i.e., Big Blue and the Danish business
conglomerate A.P. Moller – Maersk Group which is also known as the Maersk have

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planned a joint venture which shall provide a much more efficient and robust
techniques of global trade with the help of Blockchain technology Using this
technique, they shall also innovate and bring about digitalization the Supply Chain
and enable tracking of cargos. This new platform shall bring about a revolution in the
shipping business as it shall make an annual saving of millions of dollars. It shall also
save a lot of time as the estimated time of delivery shall keep the port or yard
available for the containers to offload. The Global trade digitalization head at Maersk
group said that this portal should bring in transparency across all levels of the Supply
Chain and shall enable transfer of cargo information on the real-time basis the buyers,
port and customer officers, seller and the logistics company (Lumb et., al. 2016).
However, the cost of access to such information is not yet decided by the authorities.
For tracking and monitoring, the Blockchain shall enable a dashboard which will
comprise of information for all the stakeholders across the globe that shall be
accessible to all the paid parties. Michael White, former president of Maersk line in
North America and CEO of the new company, said that the Blockchain technology
should also improve data security. This setup shall keep the data double encrypted.
This setup noted that the transparency should also bring in more trust from the
people. Any change in the data will be immediately visible to all. Blockchain will
also have an element which shall make an audit trail for all the changes in
regulations. Blockchain has been an area of concern for the entire industry. It mainly
revolves around having a globalized and digitalized platform wherein all the elements
of the Supply Chain are connected to each other thus reducing trade barriers. This
platform is made on an open area network with the help of Blockchain technology.
This process will help in two main elements which are transparency and visibility and
documentation. The main idea behind this technique is to keep all the aspects of
Supply Chain in touch with each other and reduce the barriers. The elements to be
linked shall be shipping company, buyers, sellers, port, customs, etc. Provide
Shipping Information: This platform shall enable visibility and bring in transparency
in the entire Supply Chain which allows real-time information sharing (Riley, 2017).
According to Fisher (2017), since the invention of containers in 1950, there has not
been much changes and developments in the Shipping Industry. Any international
trade brings in a lot of paperwork and documentation along with various rules and
regulations. Blockchain brings in digitalization and enables bitcoin the digital
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shall help in keeping and record and tracking of a vast number of cargo containers by
use of the digital platform and connect across the element of the Supply Chain. In an
interview, Vincent Clerc the Chief Commercial Officer of Maersk’s said that there is
the scope of bringing in digitalization and making use of the power of technology and
then creating a unified platform which shall bring all elements of Supply Chain at
par.
As stated by JOC (2018), the shipping business is hugely dependent on paperwork.
Besides the legal contract on paper, a lot of data and information have been shared
digitally by way of Electronic data interchange (EDI) a 60-year-old technique. White
said that by setting up the API based technology system, there would be much more
transparency and visibility to all the elements of the Supply Chain. Digitalization:
Reduce paperwork and documentation that shall enable parties across boundaries to
share documents freely and quickly using the digital platform (Vogt and Paul, 2011).
They shall take help of web-based processing that will create a workflow by the
goods and services in the cargo keeping in mind the other needs of transport. They
will have more information on the delivery status and location of the carrier. This
new platform shall bring about a revolution in the shipping business as it shall make
an annual saving of millions of dollars. It shall also save a lot of time as the estimated
time of delivery shall keep the port or yard available for the containers to offload.
Manual tracking and paperwork results in inefficient control, the scope of fraud and
forgery along with failures and disputes.
1.3 Problem Statement
This concept which has gone live in the market by the mid of the year 2017, shall be
successful only if Maersk and IBM shall be able to convince the investors, shippers,
port, sellers and the various elements of the Supply Chain to sign in and use this
concept. Besides IBM is not the only company in Blockchain technology there are
many other companies such as Accenture who uses a different type of editable the
Blockchains as opposed to immutable Blockchain by IBM. There are questions
related to governance and scalability of Blockchain. Digitalization of the industry
exposes it to the threat of cyber-crime and cyber thefts. There are many
apprehensions about privacy and security of data in the digital environment as is
being promised. Is Blockchain Technology better than a Paper-based or Electronic

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Bill of Lading being also the question? There are many issues related to removal of
third parties and banks in minimizing costs of the transaction due to lesser needs of
trust in Blockchain which is relatively new technology. The use of Smart contracts as
an alternative to current Bill of Lading and Electronic Bill of Lading which can make
payments immediately of the fulfilment of conditions still needs to be understood by
many stakeholders.
Blockchain at this stage is posing more questions that findings solutions to improve
container transport in the Shipping Industry. There is a need to remove the
apprehensions if this technology has to become successful by large-scale adoption by
industry players in the Shipping Industry.
1.4 Structure of Dissertation
The research is divided into many chapters.
The first chapter examines the background of research pointing towards the current
inefficiencies in the Paper-based Bill of Lading. The aims and objectives are
explained and what the study seeks to achieve.
The second chapter examines significance of this research on Blockchain and Bill of
Lading is essential to Shipping Industry
Third chapter literature review critically evaluates various aspects of Blockchain
technology. The issues related to Supply Chain ecosystem about a Bill of Lading in
the Shipping Industry are examined and how Blockchain technology can be the
solutions in dealing with those issues are understood.
Four Chapter answer to research questions that this research seeks to achieve.
The fifth chapter explains the need of qualitative research methods and why
comparative Case Study was more suitable as compared to other strategies to analyse
the use of Blockchain technology in Shipping Industry based on comparing two
Blockchains and suitability of Blockchains in compared to the Paper-based and
Electronic Bill of Lading.
The sixth chapter, a comparative analysis of Blockchain technology available such as
IBM and Accenture are also done to see various choices the importer and exporter
and governments have for the adoption of Blockchain framework. It also analyses
with the help of comparative analysis the process of Blockchain technology which

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can be helpful to removing inefficiencies related to current Paper-based and
Electronic Bill of Lading in the Shipping Industry.
The seventh chapter discusses the findings of research compared to a literature
review to point towards gas in the analysis. It chapters briefly summarises the main
points in conclusions determined from the primary results. The research also provides
recommendations to Blockchain technology company so that this technology can be
adopted on a larger scale.
Eight chapter the research limitations are discussed to understand what more could
have been done to improve the research. Further areas in line with the current study
are also provided an area of new research related to Blockchain technology in the
Shipping Industry.

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2 Significance of Research
The Blockchain is an emerging technology, and there are many apprehensions in the
minds of an exporter, importer, governments, customs, etc. without whose
cooperation and widespread adoption this technology cannot succeed. Unless the
apprehensions are removed by explaining how the technology works and how it is
beneficial, it may not be adopted on a large scale.
The research will help to gain an understanding of the emerging aspects of
Blockchain Technology in the Shipping Industry. IBM and Accenture are two prime
companies in leading the industry in Blockchain technology. Hence there is a need to
understand which Blockchain technology is more suitable for the Shipping Industry.
The research will help those operating in shipping liner industry, importer, exporter,
customs, etc. in the Shipping Industry to understand Blockchain Technology and
determine its adoption.
There are issues as how why to adopt Blockchain technology as compared current
inefficiencies in existing Paper-based Bill of Lading and Electronic Bill of Lading.
The research seeks the to evaluate how IBM Blockchain Technology with is a smart
contract, and immutable Hyperledger seems to be more promising than the existing
systems. The research will help to understand how Blockchain technologies adoption
will be significant in improving efficiencies related to Bill of Lading and other
contracts in the Supply Chain ecosystem about Shipping Industry.

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3 Literature Review
3.1 Introduction
The literature reviews by examining the problems related to Supply Chain in the
Shipping Industry. It proceeds to explore the issues related to Supply Chain and Bill
of Lading in the Shipping Industry and how Blockchain technology can help to
address these issues. However, there are some impending challenges which
Blockchain technology faces which are also discussed.
3.2 Shipping Industry
According to Kavussanos and Visvikis (2006), the Shipping Industry is the collection
of many actors from different platforms which has a very complicated supply
network chain who are interacting each other directly or indirectly for processing the
shipment work across the world. Shipping is demonstrated as a data infrastructure in
which the work activities of the shippers who performs the tasks individually,
companies doing the freight forwarding tasks, trucking organizations, financial
organizations for performing the accounting tasks, dock workers, companies
conducts insurance works, customs, etc. are playing a vital role in creating an
infrastructure in the shipping domain. There is a legacy infrastructure base which is
managed technically within the interlinked and globally related over a particular
period (Byrne and Ragin, 2009). This unity process results in the consolidation of
factors, for evaluating the transitory trading practices that are under apprenticeship.
3.3 Issues and Challenges in Supply Chain for Shipping Industry
3.3.1 Issues of Trust in Shipping Industry
According to Banker (2016), Blockchain is very useful in International Trade a
system which is an intensive system for both documentation and period and involves
people from various sectors like importers and exporters, customs authorities, cargo
inspectors, etc.… The trust between the importer and exporter lies at the lowest level
during the shipment process. Importer tries to delay the payment as long as possible

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whereas the exporter attempts to ask for the amount as early as possible. Both parties
need money for the smooth processing of their operations and avoid many kinds of
distractions. The level trust is fragile between importers and exporters, that may be
resolved by applying trade finance system. Trade finance work in a way that the trade
finance has been paid by the exporter with a letter of credit (Sun et al., 2016). This
letter is a kind of guarantee, and the money is transferred to the importer after the
exporter notifies the successful and quality shipment of goods from the importer.
3.3.2 Letter of Credit – Necessity of Trust in Paper-based BOL
According to INCE (2017), in international trade, the business dealings are being
facilitated by the letter of credit (L/C) as financing/payment mechanism if yet there is
no healthy trust relationship between the buyer and the seller to minimize the legal
and economic separations amongst nations. It is being expressed by the buyer’s bank
with an L/C that it would repay the due amount to the seller on the introduction of an
arrangement of determined records, the BOL. It is essential to strictly follow the
conditions of the L/C for the distributor (shipper) to get the cash under L/C. If there
will be any discrepancies, the due amount might be refused by the bank which issued
the L/C. This distrust among parties involved creates needs of third parties and banks
in the Shipping Industry.
3.3.3 Issues related information sharing in Shipping impacting Supply Chain
According to Moritz et al., (2017), the information obtained from the modern Supply
Chain of the shipping domain which is very large on information and short on the
assurance. Traditionally the problems of trust among the organizations which
includes fear about the information leak or any other kinds of spy works may cause
harms to the organization. Because of these problems, the shared information which
is shared among the organization cannot be fully trusted. The management of ports is
a very crucial part of the shipping process because it is considered as the primary
bottleneck for transferring the goods.
Collections of documents are transferred during the shipment process like bills of
lading which contains the information about the goods. In the next step, the products
are unloaded by the agents which are again a complicated and risky task. Shipping
process gets delayed because of this inconsistent delivery methods, and the goods are
being dumped in the garages for a more extended period (Anders et al., 2017). This

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adversely effects on the quality of shipping process and thereby makes problems in
the stakeholder which increases the complexity of Supply Chain management.
Failure in retrieving reliable information on time, the invisibility of goods delivery
management, the emergence of significant shipping bottlenecks, work process
improvement in the inventory management system or loss in sub-optimal levels are
the primary factors which extend the transit time of the goods. There is no proper
digitalization of papers which leads to delay in transport of products in the shipment
domain (Riley, 2017). Similarly, the Bill of Lading is used by many parties like
exporters, importers, freight forwarding employees, terminal operators, etc.… The
period for bill lading is one night for receiving the goods after it has arrived.
According to Razavi and Iverson, (2006), one of the major concerns in the Supply
Chain management is the information sharing within or outside the organization. To
solve this problem, there is a trusted network which enables the individual
information sharing with certain security norms. Information leakage is the major
issues problem associated with the information processing in Supply Chain partners.
The confidentiality of information should be appropriately evaluated and most of the
companies need to make assurance in the information exchange among Supply Chain
partners is highly confidential (Nigel, 2017). This trust in the confidentiality of
information increases the bonding between the partners in the Supply Chain
integration process.
As mentioned by Anders et al., (2017), for assuring trust in the Supply Chain sector,
the roles of intermediaries are significant. They are getting profits in the way along
with ensuring the confidentiality of the information like certifying the goods quality
and safety, and various measures for financing measures. Trusted intermediaries help
to reduce the transportation cost and other processing charges, asymmetry in
information exchange and different kinds of uncertainties with a high degree of
bargaining capability. There should be a logical way of trust between both parties
which is essential for perceiving the relationship while sharing the information.
3.3.4 Problems of Custom process in shipping Supply Chain – Transparency
According to Weber et al., 2016, administration efficiency of customs is another
major bottleneck in the Supply Chain. The service range and quality of goods are
calculated from the national customs authority are depends on the clearance easiness

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of import and export and the delivery speed. If the resource allocation is not efficient
and not sufficient and not correctly adopting best practices in the customs
procedures, it led to the time delay for approval and forced to face different kinds of
frequent inspections. It is challenging for the companies with low investment in
developing countries to clear the customs procedures. One of the main reasons for
the delay in delivery is the lack of corporation between the customs agency and the
companies which have no proper trading standards. In the countries like Africa and
some related regions there is a high amount of corruption issues, and with
appropriate Transparency, these kinds of problems can be solved efficiently up to an
extent. There is a direct cost named “facilitation payment” which is considered as the
additional payment for any kinds of delay because of bribe. If there is no proper
trading system, the regulatory environment will be very worst functioning and
unstable (Forum, 2016).
3.3.5 Bill of Lading
As stated by Takahashi, 2016, a report issued for the benefit of a transporter of
products by the ocean to the individual (usually recognized as the shipper) with
whom the carrier has an agreement for the coach of products is the Bill of
Lading(BOL). Over time exceptional legal status and commercial importance have
been gained by the measure of landing which is a business report, consequently
efficiently making a case for the designation of the initial adaptable report in
commercial history. The BOL is usually performing three standard functions. First, as
depicted in it is acts as a receipt for the products and got by the transported for
shipment. Second, for the carriage’s contract, it is considered as evidence. Third,
concerning the products, it acts as a report of title. However, this work is related to
the BOL’s purpose as a record of the claim. In the international procedure of
shipping, alongside the packing list and commercial invoice, the BOL plays a vital
role. When the conversation amongst the seller and the buyer are on related to the
conditions of sale the significance of BOL isn’t all the time comprehended. Though,
the on-time arrival of cargo upon entering to the nation destined could be impacted
by the BOL. The BOL acts as an agreement amid the proprietor of the merchandise
and the bearer taking care of the merchandises transportation.

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3.3.5.1 Issue in Paper-based BOL resolved by Electronic Bill of Lading
According to Takahashi, 2016, Bill of Lading is the primary shipping document in
almost all the trading sectors, especially in trading sector. It is a document which is
given by the carrier as an acknowledgment for the shipment of shipment of goods.
The Bill of Lading is very symBoLic of the products itself and best suited for the
trade finance systems. Manual Recordkeeping and bill generation have many
disadvantageous like the risk of misbehaviour and time delay during the cross-
checking of bills by the parties to parties (White, 2018). Many industries have used
an Electronic Bill of Lading for long. But Shipping Industry is bit hesitate to enter
into the Electronic bill (E-BoL) system because of the complexity of the shipping bill
processing. One of the significant issues the Shipping Industry point out is the
replication of a paper bill and related document which is being managed by the rules
of approval and completion. There is sophisticated legislation which identifies the
critical billing “documents” for legal proceedings if required and the doubt in the
Electronic billing system as for whether the E-BoL can act as a “document of title” in
any circumstances like if it is possessed or delivered physically (Patticia, 2013).
There is always a bad mark for the Electronic data exchange which is identified as
risky and not accurate which can be duplicated or modified easily.
Today the medium of choice is the paper BOL, causing the inefficiencies, costs, and
difficulties of all the parties involved. Then from digitalization how the business
industry could be benefited? Software solution deployment is the apparent answer
using which the parties could access the bills as an Electronic document. The
functional and legal of a paper BOL is equivalent to an Electronic BOL (or eBL). The
main elements of a paper BOL must be digitized by th eBL, specifically its legitimate
acknowledgment as a receipt, as a record of title and as proof of or having the
agreement of carriage (Brody, 2017). By this comprehension, there should be a
consideration on the cut off in the global trade movements pace versus the progress in
the documents related to trade, and due to these, the inefficiencies happened. Thus, it
is essential to have, by 21st-century technology, a digital solution to reproduce and
computerize the procedures.

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3.3.5.2 The Cloud-based platform should address issues related to Bill of Lading
According to Acheson (2017), all the parties should be enabled by the solution to
draft in Electronic documents that are accepted internationally like eBLs, invoices,
and certificates of origin, warehouse warrants and other supporting documents that
reflect the norms and standards of the vast industry. Neutrality – because of the
involved parties’ heterogeneity like customs, terminal operators, cargo forwarders,
manufacturers, banks, etc. advanced level of neutrality needs to be ensured by the
service provider to shun any irreconcilable circumstances among the parties involved
(Takahashi, 2016).
The solution should facilitate first Electronic document exchange. Consequently, to
the Cloud-based platform, the parties have access. E-signatures are required to
present and transfer the reports Electronically. E-marks are required to submit and
exchange the documents Electronically.
3.3.5.3 Legal Issue in Electronic Bill of Lading execution
According to White (2018), in replicating the elements of the BOL by Electronic
means the most challenging part is in accomplishing vital negotiability. There are
various reasons for this; the most significant are – the BOLs being regulated by the
laws assumed the utilization of paper in proprietary rights or exchanging possession
in the products. This makes issues in the eBL execution which intends to forgo the
requirement of the documents’ physical exchange. Likewise, by simple endorsement
is the products’ possession is transferred in multiple strings or a string agreement.
3.4 Blockchain
According to Brody (2017), Blockchains are the distributed ledgers which stores
makes a permanent and shared document for each transaction related to a particular
asset and thereby establishing an unbreakable trust among the parties. It is a public
document which is divided into a widely accessible network with needed security.
The Blockchain is acted as a cryptographic proof and does not emerge from a trust.
According to Nakamoto (2008), Blockchain is performed as an interaction between
the consenting parties without depending on a centralized organization like a bank for

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managing the work process. There is a cryptographically secured, and synchronized
ledger can be created using Blockchain protocol.
Figure 1 Building a Blockchain
(Source: IBM, 2018a.)
The technology behind the concept Bitcoin is Blockchain which is following
“Distributed Ledger Technology” methodology. According to Wright (2015),
distributed ledger Technology is an incorruptible and irrevocable collection of data
enclosed, shared in an encrypted database. So, the Blockchain concept is distributed
ledger which can be audited and evaluated by anyone but cannot be changed by no
one. According to Swan (2015), application areas of Blockchain technology are
tracking of assets, monitoring of assets, processing, and communication of long-term
contracts.
3.4.1 Distributed Ledger Architecture
According to Nakamoto (2018), distributed Ledger Tracking (DLT) allows multi-
party ledger tracking, machine to machine interaction (M2M), assets and liability
transparency and letters of credit. The massive amount of paperwork can be avoided
using this technology. Digital wallets and smart contracts help to reduce the risk in
asset management. The cryptographically interrelated sequence of data blocks are the
building components of a Blockchain. These data blocks are interconnected in the
chain as a sequence of cryptographic hashes. There should be specified length for the
hash tag which is derived from the particular document or record. According to
Norton et., al. (2016), there are three major components in each data block Block-
Data, Chaining-Hash, Block-Hash.

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Figure 2 Key Concepts of Blockchain
(Source: IBM, 2018.)
According to Glaser (2017), Blockchain is a transactional database in which the
information is stored as data nodes where the nodes are interrelated using the peer-to-
peer network (P2P). The network access is permitted using a permission mechanism
which allows the nodes to do the work process utilizing a validity which is based on a
consensus mechanism. But Blockchain is no concept which can be used instead of the
database, a business transaction process, nor a messaging technology.
As stated by Southrust (2016), various transactions in the trading system are recorded
digitally in Blockchain system. Once the transactions are recorded in the order, it is
immutable and highly secure. There is no central authority for controlling the deal,
and it is accessible to all the participants of the Blockchain network. The transactions
in the system are decentralized, and it can be easily tracked and traded. Documents of
the trading platform can be accessed and verified easily which minimize the
operational and compliance cost. All the information regarding the business
transactions is available in the Blockchain network (Heng et al., 2017). Participants
can freely use this information without any intermediary cost and complex
negotiations. In the standard shipping and freight industry, the role of intermediaries
and brokers are inevitable, and both shippers and carriers lost lots of money in
between the business. This can be prevented by using Blockchain network. As there
is no centralized authority to control the information of Blockchain network,
synchronization of all the information is very easy and secured (Dickson, 2016).
When the participants are new to this industry they can access the feedback and
records of others can make better decisions on the same.
Distributed Blockchain

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Figure 3 Distributed Blockchain
(Source: Ameer, 2016)
According to Gurdus (2018), as there is no central server in the Blockchain concept,
it makes the technology more potent concerning system security same way it makes
the system more secure and prevents any kind information of hacking. Modification
of a transaction within the nodes needs a massive number of recalculations which
leads to further high secured protection scenario (Xu, 2016).
Figure 4 Distributed Ledger System
Source: (MAA1, 2017),

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3.4.2 Proof of Work (PoW)
As stated by Heng et al., (2017), the PoW is required by the Blockchain eco-systems
along with these essential security objectives. To make that the service providers are
protected against attacks of resource consumption is the PoW’s principal and general
aim. A specific type of resource investment is needed from the side of the provider to
request a service. If the web-page has to be accessed by the client, for instance, it
requires building up an association with the web-server. As per the client’s request to
run the system protocol resources must be invested from the side of the server to run,
to build up the connection. Denial of Service (DoS) attacks might happen if many
such requests are being sent by the client which piled up more work on the side of the
server (Gupta,2017). From the client’s side by appealing specific commitment, this
problem is being approached by the PoW concept. With regards to Blockchain, it
needs dedication towards the involvement of Blockchain. By solving the so-called
puzzles of crypto-graphic clients, this is accomplished, that included a larger space
for search information is being searched. It is known as mining in the terminology of
Bitcoin. Due to the resources intensiveness, it is hard to find resolutions for a puzzle,
which is a PoW protocols’ important property, however, as an investment of
important resource is not required it is efficient to verify the resolution (Sandell et al.,
2016). Like this, all the peers could effectively confirm that whether right block’s
production is a result of mining.
3.4.3 Blockchain Types
According to Martinovic (2016), Blockchain permutations mainly come in two
categories public and private. Public Blockchains permit the users to view or send
transactions till the period they are in consensus process whereas individual
Blockchains also known as consortium Blockchains which allow only the licensed
number nodes are authorized to view or share the ledger. For example, in public
Blockchain category, some firms like banks or clearinghouses make use of
Blockchain for trade clearing which is allowed with a series of the verification
process. In private Blockchain, a group of employees for an organization making
changes in a distributed ledger follows a network partnership. By using the self-
policing security of Blockchain, it prevents a significant amount of record keeping
which leads to confusion to the users. The main difference with the permission and

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permissionless Blockchain is based on the right to make changes or vote to the
particular work platform. Only few network participants and apply for the updates in
the permission ledger and can be the part of verification (Dickson, 2016). Examples
of permission ledger are Chain, Domus Tower, Bank chain, etc.… But in permission
less ledger anyone has the same right to request for updates in the accounting and
also can participate in the block verification process. Examples of the permissionless
ledger are Bitcoin (leading case), Ripple and R3.
Figure 5 Types of Blockchain
Source: (Pavel, 2016),
Shared Ledger – According to Kakavand (2016), in Blockchain network, the
information paradigm from a single owner is distributed to a shared platform of a
transaction. By using a shared ledger, the users can evaluate the operation and can
check the identities or ownership of the sales without any cost or asking help of
Intermediaries. Based on the access privileges and roles of the users all kinds of
relevant information are available and shared. Permissions – By using Blockchain
business network, we can set up specific restrictions and authorizations where the
transactions are accessible to the members who meet the credentials of a member’s
only club. Cryptography – Along with the permission credentials few more advanced
encryption techniques can also be applied to the transaction which prevents
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3.5 Advantages of Blockchain in the Shipping Industry
Figure 6 Features and Advantages of Blockchain
Source: (MAA1, 2017)
3.5.1 Blockchain Solution for Data Visibility and Transparency
According to Monk (2017), in the Blockchain, each of the data records is time-
stamped and integrated to the corresponding event before it. There is a high
prospective for Blockchain in three areas like optimization, transparency, and
demand. Recently an interview with Robert Morris, the Vice President of Global
Laboratories of IBM states that Blockchain is the concept behind Bitcoin. Blockchain
has gained worldwide attention because of its transparency and security. The
Blockchain is acted as a digital ledger with a collection of data batches as “blocks”
which has connected each other by using cryptographic validation. This section is the
security part which saves the information from hacks and unauthorized access. The
visibility or transparency part of Blockchain is, the information storage has no master
location, and there is no single control entity to manage these blocks. The
information is being distributed on multiple platforms and everyone who accesses the
data will get each copy, but they cannot modify it. Instead of adding new transactions

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different companies can use the same Blockchain ledger for their work process.
These newly added changes are visible to everyone. This reduces the complexity of
the work process, and different companies can use the same Blockchain ledger as it
acts as a copy of their system. The Cloud-based accounting helps to make sure the
companies that the data records are not replicated anywhere not altered by anyone
and increase the visibility of the transactions which tremendously increases the level
of trust (Yan and Lirn, 2017). Morris also added that Blockchain is a legal document
which consists of product and service related data readily available to everyone to
conduct the business smoothly. The Blockchain is acting as an efficient network
which removes the replication of efforts and minimizes the dependency of
intermediaries. Blockchain uses consensus models for validating the information
which makes the transactions more secure and authenticated. The users of the
transaction system are same, but the difference is the same transaction record is
distributed among all the users who requested for it.
As per Banker, (2016), organizational silos of existing parties of the Supply Chain
sector can be prevented by using Blockchain network which allows the parties who
engaged in the process to access the data. As a result, real-time access to data is
possible in a secure way. As a result, the participants of Supply Chain management
can efficiently use information which is distributed and applied in ERP (Enterprise
Resource Planning) and TMS (Time Management System) instead of just burying the
news in legacy silos. Authenticity and provenance of the goods can be quickly
evaluated by using Blockchain technology and thereby the Supply Chain members
can easily take decisions on the same. A full-fledged copy of ledger is available to all
actors in the Blockchain network. Using this ledger, the actors of Supply Chain
monitor the activities and transactions (Lieber, 2017).
According to Lemieux (2016), transparency and tracking of goods can easily be
performed by using Blockchain. The actors with the Blockchain can easily
communicate with each other and share their information like geo-waypoints, any
update on shipment. When any data like shipment confirmation is recorded in the
Blockchain, it is permanent or immutable no third parties can able to manipulate the
information. This increases the transparency of the transaction and decreases the risk
and any kinds of hacking. All the critical transported information is logged in to an
encrypted ledger in a decentralized (Gupta, 2017). The hackers cannot manipulate
this log, and the security of the information is ensured.

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According to Nigel (2017), robust and secured logistics exchange, coordination of
various activities, truck fleets and shipment container optimization is also possible
using Blockchain technology. The entire ecosystem can be transformed by using
Blockchain by improving the transparency. Supply Chain management is the perfect
example of denoting the potential transformation of the Blockchain. There had a
quick impact on the change of small part of Supply Chain like transporting
information. If import terminals in the earlier process access the bills of lading
information, their terminals execute can efficiently perform without any security
constraints.
Blockchain enables real-time data access to all the authorized participants. This
secure, and speed access helps to speed up the logistics process and eliminates most
of the bottlenecks. Both financial and information flow is getting benefited by this
access (Martinovic, 2016). There is proper data visibility, and real-time data access is
provided by the Blockchain technology recently.
3.5.2 Blockchain based Bill of Lading transparent than Conventional Bill of
Lading
According to Hackett (2018), there are two primary factors which assure the fact that
Blockchain based bills of lading are more transparent and reliable than the
conventional type order bills of lading. 1) There are a set of documents of the shipper
is needed for the verification of bills of lading like attested endorsement, Blockchain
based token, identity documents those who are transferring the goods all the
documents should be authenticated by digital signatures which gives more security
compared to handwritten signatures. 2) Once a participant in Blockchain network
does the numeric name, it is immutable whereas a usual handwritten signature cannot
give such assurance. This feature ensures the fact that “Blockchain bills of lading
gives assurance that the transaction retains its nobility.”
Built in Trust
As stated by Lubowe and McDermott (2016), Blockchain technology eliminates
friction and cost in various areas mostly in financial sectors because there is no
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peer networks and central communities are used instead of central authorities. There
is no power given to a single entity for taking actions on behalf of this particular
sector. Blockchain uses an encryption technique which ensures the security and
thereby trust in the system features and participants.
Traceability
According to Moritz et al., (2017), any kinds of information tracking can be quickly
done using Blockchain technology. For example, tracking information regarding
Supply Chain can be monitored using Blockchain technology and knowledge of
product lifecycles like supplier information and logistics details. All kinds of product-
related like management of the product, storage details, and transportation details can
also be retrieved from the data block ledger. Apart from all these features traceability
of the product information and problem tracking is also can done using Blockchain
technology.
Challenges in information solved through data optimization.
To improve the decision making in various levels of Supply Chain sector, there is a
need for proper distribution of information widely (ICNE, 2017). Additional
information about the shipment for avoiding the delay problems related to opening
the goods. Massive corporation of the Supply Chain has used the concept of dynamic
optimization within the system (Anders et al., 2017). An only authorized person from
respective departments can access the data record of Blockchain. The necessity of
information required by the parties can be part or as the whole. Verification is
essential for obtaining the data from Blockchain. As a result, the data in Blockchain
has a widely spread secured network. After the transparency feature optimization is
the critical feature in Blockchain of Supply Chain management. There is an iterative
optimization in the chain of events, and real-time and continuous access is allowed.
In the same way, the audit trail of Blockchain method makes a broader network of
trust among the Supply Chain sector.
Time and Cost Savings
In Blockchain technology the transaction time is reduced from day to minutes. As
there is no central authority verification is needed in Blockchain transactions the
settlement is performed very faster manner. By using this option conventional

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product labelling practices can be replaced, and the custom clearance process has
been improved. Automatic value transfer is triggered using smart contract in
Blockchain implementation (Riley, 2017). The destination of the shipment can be
tracked easily using GPS location tracker.
According to Nigel (2017), in the shipment sector the documentation and processing
cost is reduced by implementing Blockchain technology and there by prevents any
kinds of delay because of huge paperwork. There is high level of transparency in
real-time transactions for the shipments which ensures high safety in borders.
Operational and compliance cost is reduced by shipping lines and in the same way
port operators are also minimized the operational cost which gives high transparency
in trade flows.
Enhanced Privacy and Security of information
According Gronholt (2018), Blockchain is capable of creating a decentralized and
immutable data block ledger which ensure high data quality and zero chance of
failure. This increases the visibility and security of the stored information available in
the Blockchain across the transaction lifecycle. The problems of cybercrime and
tampering can be eliminated by using Blockchain security features.
With permission network only, the members with proof are allowed to participate in
the system (Martinovic, 2016). The goods and services they are planning to trade
should be exactly same as they represented in the network. By using specific id and
other kinds of security credentials the users can decide what all details they can allow
to other participants to view. Users can also extend the permissions later like if they
want to share the details with auditors who need more information. Security is
another essential feature of Blockchain technology which makes the network
protected from hackers. Blockchain implemented security by using a decentralized
cryptographically secured feature which makes the data hacking impossible to
anyone (Cecere, 2014).
According to IBM (2017a), double spending problem and hacking problems can be
quickly resolved by using Blockchain technology. To improve the cash flow of
trucking companies as it allows permission to access the money flow correctly, but a
percentage of money is charged as a bill. There is a tremendous amount of money is
being wasted part by part of the transaction of the trucking business. Because of this
double spending trucking companies forced to spend their money in various sections.

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All these issues can be resolved by using Blockchain technology with the help of
smart contract for the automated processing of the transaction
As per JOC (2018), confidentiality is another important feature which enables access
to information only to the authorized participants. Different kinds of security
credentials like security key, decryption mechanism is applied for providing security
to the transactions within the Blockchain network (Jorgen et al., 2017). Unauthorized
access is guaranteed with the integrity of information strategy. Insert, delete, update
are the data manipulation methods and by using integrity rule manipulation methods
are not allowed.
According to Cachin (2016), there are specific roles specific identities provided along
with permission which creates a more secure network for accessing the information
because there are no central authorities. In the earlier work process, the import
terminals received the info from bills of lading which execute correctly without any
security concerns. Information privacy concerns can be resolved with the help of
smart contract which is based on corporate identity solutions.
Benefits of decentralized Blockchain Bill of Lading over Electronic Bill of Lading
According to Wright and Filippi (2017), Blockchain ensures guarantee in uniqueness
for the transferrable documents and thereby provides an attractive use case for the
decentralized network. Compared to conventional bills of lading system Blockchain
bills of lading have many advantageous. In the traditional bills of lading system there
is centralized network for controlling all the transactions but in Blockchain
technology the transactions are recorded in a decentralized peer-to-peer network
which makes the billing system more accurate and error free. Decentralized system
makes the transaction more reliable and it eliminates all kinds of manual mistakes
and other associated costs. There is no single point of mistake happens in the
Blockchain technology because the system is more vulnerable and free from
hacking. There are no problems related to the censorship from the government or
related authorities. Even though there are many advantageous related to Blockchain
technology we need to look in to some concerns for implementing this network in
the business chain network. According to Crobsy et al., (2016), Supply Chain
network is very complex, and it involves huge amount of paper works and if we are
implementing Blockchain technology in the current business there are lots of things

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to consider and make sure this technology is fit to the business environment in all
aspects (Dickson, 2016).
Shipping Industry is very complex, and it includes lots of transactions and work
activities before reaching it to the consumer (Kosba et al., 2017). Supply Chain
lifecycle involves too much complex operations in each stage like legal approvals,
intermediary cost, delay in delivery, operational and compliance cost etc.… In the
present bills of lading system, it is being determined only the authorities will get
confirmation from the legal authorities. As a result, banks will not accept the bills of
lading as a proof or guarantee of shipment transaction. Whereas in Blockchain
network, there is validity for the Bill of Lading till it get enough legal approval from
the legal authorities. A Blockchain based bills of lading ensures that it is a “flexible
Electronic transport record” which is notified by Rotterdam rules that it also gives
assurance about that “the record keep hold of its integrity” (Takahashi, 2016).
3.6 Smart Contracts
According to Nel (2016), smart Contracts is the key innovation behind the Ethereum
Blockchain which helps in achieving transparency and efficiency. Smart contracts are
contracts that get self-executed once predefined conditions are met. This architecture
is often helpful in scenarios like shipping escrows which would help in eliminating
the approvals from the people involved for executing the contract. A concurrence or
prescribed principles that control business dealing is known as smart contracts which
are reserved on the Blockchain and is carried out as a part of dealing (Kakavand et
al., 2016). Smart contracts remove the difficulties and lag fundamental in contracts
by making the agreement into undertaking. The Blockchain demonstrates the
surroundings under which a dealing or credit transaction can take place, with the help
of smart contracts.
As per Riley, (2017), modifying Blockchain telecommunications like the smart
contracts could have the below benefits for the transportation business like fast
processing time and actual time renewals, greater correctness, complete clearness,
enlarged protection. Every fact is encoded an entity which accumulates safety by its
own. The consumers cannot intervene with the structure and alter the data saved in
the Blockchain take care of the market from deceptive movements and various
investigative guidance. Increased security - as the information in the Blockchain

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network is encrypted by that time itself it is added a security by itself. Cost saving –
in trading sector major part of cost comes from the documentation section, delay in
processing or any kinds of erros (Fisher,2017). Easier access to the market –
Participation of intermediaries can be elimintaed in Blockchain technology and
thereby the particpants can directly communicate with each other and do the business
which makes the Supply Chain little more lighter.
As stated by Lardinois (2017), the transactions processes recorded in the Blockchain
network are by using smart contract which is processed and executed at the same
time. By implementing the term smart arbitration, the transactions in Blockchain
network are standardized. All the disputes related to the settlement of smart contract
are settled as soon as possible with the help of arbitration rules (IBM, 2017). As the
transactions are public to all the participants there is very less chance of dispute.
Chief strategy officer of Fleet Complete Mr Sandeep Kar notified some benefits of
using smart contracts and simplified claim settlements are accelerated payment, high
security, theft reduction, and minimized paper works of Supply Chain, high visibility
in price, reduction in compliance cost, simplified claim settlement etc.
3.7 Challenges of Blockchain technology
According to Patel (2017), the challenges to Blockchain in logistics and
transportation are many. Kar briefly said as Less preliminary information, skills,
proficiency, and faith in the technology, limited trouble-free availability of crypto
currencies, by which the Blockchain system is attached well or not in most of the
time. The unfairness to the current infrastructure, lack of central power to diminish
the risk, possible cryptocurrency unpredictability not providing any central power
controls cryptocurrencies.
Faith in the process of the transaction is the restriction in Blockchain technology
(Lemiuex, 2016). Reliability of records is not mentioned in Blockchain technology in
itself. Security (in the recording) is not the critical element in Blockchain technology.
Despite these technological advantages for the Shipping Industry, some problems
should be mentioned before a full Blockchain system is accepted in the case of dry
bulk and tanker shipping.
Higher flexibility: As per Lumb et al., (2016), the situations that arise in shipping
where the parties can only solve through a commercial approach. The parties have to

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face these on the ship. These situations are very usual in shipping. But this is difficult
to take place sometimes when the transactions are done through a conserved system.
In this method, it does not allow any meddling from the parties. Also, it is widespread
the parties caught up in a transaction to have their contractual terms which are
typically focused on the negotiation of the parties. The question arises, will it be
possible in a universal system? In this case, the Blockchain technology should be
framed to include special terms and conditions at the beginning or else the liability
will be higher because the parties’ liability exposure will be more than the liability
saved by the system’s use.
Universal acceptance: The jurisdictions around the world are not entirely adapted or
not yet allowed the Blockchain system (Lubowe and McDermott, 2016). On the other
hand, different governments and agencies around the world are concerned for such a
technology. The Supply Chain participants wish to use this kind of technology in
trading and shipping services. All these parties should be grouped into a unique
platform so that a universal adoption system should be achieved. For managing the
efficiency of the Supply Chain management system, data identification system plays
a vital role in sharing the information among various Supply Chain networks of the
world efficiently and accurately. According to Silina (2012), IBM also wanted an
efficient system standard for enhancing their work process collaboration and
interdependency in the Supply Chain networks. The needs of global standards are
being accepted by most of the global companies and stakeholders, but still, there is a
confusion regarding the confidentiality of data exchange.
According to Patel (2017), there are some roadblocks to the extensive use of
Blockchain in the Supply Chain. There are many entities involved in this for one
supply. They include essential things like carriers, port authorities, and forwarders,
not having an appropriate back-end system to provide into modern Blockchain
framework (Stake and Robert, 2006). That matter possibly will be well be alleviated
by Blockchain technology providers. They offer systems that would drag data from
legacy systems and decode them into a Blockchain-ready format. There’s also the
problem of motivation. It will take more than one entity in a Supply Chain to know
the value in using Blockchain frequently. They do it either using increased data
accuracy, quicker payment to suppliers, improved transparency into Supply Chain
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As stated by Anders et al., (2017), in recording the ability to ensure data
dependability is not there in Blockchain technology which is a technical challenge for
it. Therefore, to preserve the reliability of the records an extremely protected device
to track or a renowned their-party might be required for the implementation of
Blockchain might face many constraints. There will be an enhancement of trust in the
application of Blockchain if the issue of data dependability will be solved, as the
authors believed.
There is one more non-technical challenge as well. Either the implementation of
Blockchain technology would be profitable for the one implementing it. It could be
argued that in a relationship trust could be enhanced by having transparency, as
mentioned in literature: the overall success, synergies, and performance would be
increased by having faith in a relationship (Anders et al., 2017). Despite the fact, this
isn’t obvious and instant beneficial impacts. It is challenging to measure the more
intangible relationship and trust management whereas it is easy to measure the profit.
The Blockchain is the best solution for minimizing the friction in logistical and
operational regions of Trade Finance Value Chain. Within a short span of time
Blockchain revealed the work performance is optimizing the business transactions
and discarding the duplicates. But the implementation of Blockchain technology for
an extended period in the trading finance sector would be denser and complex. In this
scenario, there is a need for complete renovation of the current system. As the
potential interference is very massive and there would be various obstacles need to be
resolved. Other critical provocations are with the acquisition and collaboration of to
attain the critical mass which helps to guide the efficiencies of the network.
Management of the operational efficiency is also one of the most significant
challenges which initiate the industry wise Blockchain network. Across the whole
sector, Blockchain is only one part of the total solution. Implementation and usage of
distributed ledger require more deliberate considerations and best work process ideas
for deploying the product. In additions to these critical challenges, there are some
more hazards in legal acceptance, scalability, and inter-operability of work
transactions. This cause the adoption of Blockchain technology becomes more
complex and more efforts are a need for accelerating the implementation.

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3.8 Summary
Thus, through Blockchain the shipping domain can able to manage most of the
technical problems which are happening during the emergence of shipping domain
and information infrastructure of Blockchain management. Blockchain technology
can bring shipping and freight industry to a higher level. Shipping and freight
industry is very complicated and includes lots of paper works, processing levels, the
participation of intermediaries and brokers and lack of transparency make the current
business more complicated. Blockchain network comes into the market for resolving
three significant trading bottlenecks industry lack of transparency, lack of security
and lack of efficiency. Presently most of the leaders in shipping and freight industry
started evaluating the potential of Blockchain networks. Even though Blockchain is
succeeded in many business sectors, it is still in enhancement stage. Research says
that the impact of this technology on future business will be very high and many
areas could get benefited from Blockchain networks. The participants of Blockchain
network can easily track different kinds of the transaction, and the lifecycle of the
Supply Chain can be easily monitored using Blockchain network. In the
conventional trading system if there is any modification happened in the transaction
the whole documentation process needs to be done again as it leads to increase in
operational cost. Whereas in Blockchain network the deals once recorded is cannot
be manipulated by anyone. This helps to minimize the time delay, documentation
errors, intermediary cost and other kinds of issues. Blockchain technology provides
high transparency, security, and efficiency of the business. This technology is
beneficial for Shipping Industry because the whole life cycle is apparently visible to
all of the participants and thereby they can dynamically change the goods or service
cost as per demand. With the help of peer-to-peer network, all the ledgers are
distributed to all the users in the system with high security. Presently most of the
shipping company giants are expressed interest in Blockchain technology, and some
of them already started using it. With the help of Blockchain technology, the Supply
Chain of Shipping Industry can implement new strategies in the business and gain
more profit in future.

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4 Research Questions
4.1 Aim and Objectives
The research aims to evaluate the use of Blockchain technology in improving
efficiencies, in Supply Chain ecosystem about the Bill of Lading for Shipping
Industry with the help of comparative Case Study.
• To critically evaluate and examine the various concepts, terms, issues and the
barriers to adoption of Blockchain technology in the Shipping Industry
• To analyse with the help of comparative Case Study in two primary companies
International Business Machines (IBM) is a pioneer in the industry for the
Blockchain Technology for Shipping Industry and Accenture which is emerging as
an alternative Blockchain Technology provider, in improving inefficiencies in Supply
Chain eco-systems in Shipping Industry
• The conduct comparative analyses of Paper-based Bill of Lading vs. Electronic
Bill of Lading vs. Blockchain technology based E-BoL
• To provide proposals to key stakeholders such as vendors, shipping liners, etc. to
choose between two in adopting Blockchain technology based on analysis
There are many inadequacies in the current Paper-based Bill of Lading and Electronic
invoice of lading in the Supply Chain of Containers in Shipping Industry which has
cost and another impact on stakeholders. There are many types of Blockchain
technology in a market to resolve these inefficiencies, but IBM and Accenture are the
leaders who can create confusion in the minds of key stakeholders as to which
Blockchain technology to adopt.
The Research will seek to answer two central questions as to
1. How Blockchain technology helps in improving transparency, traceability and
security of containers in the Shipping Line?
2. How Blockchain helps in solving problems related to Paper-based and electronic Bill
of Lading by reducing the delay in paper work?

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5 Research Methodology and Design
5.1 Research Design
As per the requirement and background of the different research kinds of approaches
are there to the research design. As per the perception of the researcher also the
research design differs. Below are certain types of models – Descriptive Research: in
this research type for the collection of data the survey method is very vital and
generally on the variable there is no control. This research is kind. This research
could explain only specific scenarios. Analytical Research: further analysis of the
already available information and facts are being done in this research type for the
critical assessment of the events and news. Conceptual Research: this type of
research is formulating new concepts and at times the exiting ideas are reinterpreted.
Empirical Research: the observation or the experiments or experience is being
utilized in this research as the means of data-based analysis. Exploratory Research:
the researcher in this kind of research is empowered to exhibit various thoughts on
the current hypotheses and learning base.
The research is exploratory as the concept of Blockchain is still evolving, and hence
the study tries to explore the development in the area of Blockchain technology in the
Shipping Industry and more specifically related to Blockchain Technology.
5.2 Research Philosophy
Fundamentally in the two approaches to research two philosophies are being utilized.
Particularly in the quantitative analysis, the first type of view that is being used is
positivism, as it attempts the logical technique for investigation and has consistency
in the collection of data. The interpretivist approach is the 2nd one which is
qualitative and is utilized in mostly socio-science. Empirical testing is involved in the
positivist approach which is commonly connected with natural-science research.
Testing and experimentation idea is being promoted by this approach to validate or
invalidate theories (deductive) and after that creates new hypothesis by assembling
actualities to produce standards or laws (inductive). Ultimately instead of subjective,
it is about objective statements, and only these statements are believed to be
appropriate scientists’ domain. This is contrasted with the thought of interpretive
approach. In Socio-science this is quite extra common, where management and

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business fit in. As both things and people are being involved in management and
business, the proposal that personal thoughts and idea are legitimate is being
promoted by interpretive argument. From the perspective of the applicants, involved
in the study, the interpretive research expects to look the scenario, permitting the
applicants numerous viewpoint of reality, instead of positivism’s one reality.
The research follows a positivism Philosophy pointing towards the reality of one
situation rather than looking at multiple facts as in case of interpretivism about
Blockchain technology and its application in Shipping Industry in improving Supply
Chain specifically issues related to Bill of Lading.
5.3 Research Approach
Inductive and deductive are the two approaches to research. Inductive approach is as
well-known as inductive logic or reasoning. In this situation in particular towards the
general conclusion is the trend of flow of opinions. In this type of research, the
procedure that is executed is first the collection of data, and then by the collected
data’s analysis, the concepts and theories are designed. This research foundation is on
the quick classification of the perspectives wherein the examinations embraced, this
prompts the prototypes’ designation and further inspires the development of
hypothesis which could be universally accepted. For the scientific approach, the
deductive approach is most appropriate, wherein by means of various research
methods the theory is demonstrated. The flow of thoughts is usually from general
towards particular in case of deductive approach. The five steps of this approach are
assuming a method, in operational provisions expressing the theory that suggests a
connection amongst two particular factors or thoughts, experimenting the functional
theory, investigating the specific result of the investigation and if required by the
findings the method could be modified.
The research approach is deductive, as generalizations are derived from the data
collected about the Blockchain as it is evolving in the Shipping Industry and its
application related to Bill of Lading in improving the effectiveness of Supply Chain.

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5.4 Research Process
5.5 Research Strategy
Various kinds of research methodologies – Ethnography, action research,
experiments, grounded theory, Case Study, detailed surveys using interview and large
scale using questionnaires. Grounded Theory: The data assembled from the
applicants is used to develop the method, which will be based on the distinctive
experiences of the applicants and furthermore provides detailed comprehension of the
scenario. The grounded theory is giving the justification of the real situation and
depends on creative and critical reasoning wherein additional hard work took place,
and there is no chance of shortcuts. Survey: In the collection of data survey is very
much helpful in any research methodology. As per the availability of funds and time
the suitable means of an interview could be done that could be either personal or
other type from the applicants. Case Study: Case Study will support in selecting the
kind of organization or company or a specific field in support of the purpose of

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research. In the empirical research, this is mainly utilized as an applicable type of
investigation to clarify the practical modern happenings when there is no precise
classification of the context’s boundaries and happenings. In the experimental and
descriptive research, this is relatively usual.
Case Study
A Case Study is a detailed assessment, regularly assumed over-time, in one case –
like participant, execution process, intervention, programme, and policy (Byrne and
Ragin, 2009). Four case studies are being covered in the comparative case-studies in
such a manner to create more generic leaning regarding usual questions – how and
why specific projects or approaches fail to work or work. Over time the comparative
case studies are embraced, and across and within contexts the comparison is
emphasized. Comparative Case Study might be chosen when a requirement arises to
comprehend and clarify how the aspects inside the context are influencing the
accomplishment of policy initiatives or program and when it isn’t practical to
attempt a trial plan (Byrne et al., 2009). To alter the interventions to help in the
accomplishment of planned results these findings are essential.
The research analysis in the first part will compare the Two primary types of
Blockchains. The two case studies covered for this research are IBM immutable
public permission Blockchain and Accenture editable Blockchain. Initially, the
research analysis will take a Case Study of IBM Blockchain to examine its efforts
about Supply Chain in the Shipping Industry. The case makes an example of one of
the most recent evidence relating to the shipment of flower in January 2018 to
examine the issues associated Supply Chain and Paper-based Bill of Lading. The
case studies how IBM Blockchain can be used to address the various problems
related to transparency, visibility, privacy, confidentiality of information, security in
the Supply Chain with the help of Blockchain using public but permission
Distributed Hyperledger . The second case of Accenture is then used to examine
various features of Accenture Blockchain. The case analysis discusses what the
issues which make this Blockchain less suitable for Shipping Industry but more
suitable in the finance industry are. The data for analysis is collected from various
secondary sources such as online newspaper Articles, IBM Blockchain web page,
Accenture Blockchain, White papers, Journals, etc.

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The research analysis in Second Part will compare the different types of bills of
lading. The research collects data about understanding the differences in Paper-based
Bill of Lading Vs. Electronic Bill of Lading Vs. Blockchain based E-BoL. The first
part of analysis examines the issues related to Paper-based Bill of Lading and thus
helps us to identify inefficiencies of the Paper-based Bill of Lading which led to the
development of an Electronic Bill of Lading. In the second part Two case companies
BoLero and SWIFT which are currently using an Electronic Bill of Lading. Here we
find how an Electronic Bill of Lading is better in removing issues related to the
Paper-based Bill of Lading. It also helps us to point inefficiencies in an Electronic
Bill of Lading. The third part examines how Blockchain Technology is an
improvement in minimizing inefficiencies found in the Electronic Bill of Lading.
The new challenges that arise due to Blockchain are considered.
5.2 Data Type (Qualitative) and Analysis
Choices regarding the unit of investigation have suggestions for options of data
collection, time spans, and resources (Rihoux and Grimm, 2006). Unit of analysis is
being rooted in specific case studies. To compare the cases could incorporate
processes for implementation, decisions, groups, programmes, and individuals.
Whatever data has to be collected is being determined by the particular case’s
characteristics. Thus, it is vital to gain agreement at the early stage of the process of
evaluation. The unit of analysis’ selection would likewise have suggestions in the
Case Study for the ordering and arranging of the collection of data, synthesis steps
and investigation (Stake and Robert, 2009). Simultaneously individual cases could be
examined, with the evaluator collecting proof from various situations in the
meantime. In different cases, for instance, in the stagger execution of a program all
over spots, it will be more useful to examine the facts in a particular manner. For
hypothesis testing the latter is especially valuable and the evaluator could select
explanation of casual scenarios essential or adequate for achievement of the program,
as specific cases amid or devoid of these conditions, or on the base of outcomes-
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The qualitative comparative analysis is a hopeful analytic approach which helps
casual attribution (Patticia, 2013). The analytical method provides strategies to
facilitate precise assessment of the positive traits which might be related to specific
results of the programs (failure/success). It requires testing of suggestions, critical
thinking, robust hypothesis and detailed comprehension of the cases as in other types
of qualitative analysis (Rihoux and Ragin, 2009. Although by quantitative and
qualitative data both the qualitative comparative study could be drawn, the
connections amongst the arrangement of probable casual scenarios across and within
the cases should be focused by the analytical approach (i.e., learning based on facts).
Whereas the conventional types of analysis usually concentrate on factors and their
normal impacts (i.e., variable oriented learning).
Two specific methods of data analysis might be included in comparative case-studies:
process tracing and qualitative comparative analysis. Within a case, the utilization of
clues is being focused on process tracing to arbitrate amid conceivable clarifications
(Vogt and Paul, 2011). To check whether the results are reliable with the hypothesis
of change and either substitute clarifications could be omitted a variety of casual tests
are being utilized by process tracing. The arrangement of conditions related to every
case is documented by the qualitative comparative analysis, generally as a ‘truth-
table.’ The most comfortable set of scenarios is being identified by the study which
could represent the results of everything examined. When for a result there is one
reason the method could be utilized and along with for additional confused casual
connections.
A brilliant and formal strategy is being provided by qualitative comparative analysis
that might not be offered by other approaches to qualitative analysis (Patticia,2013).
For the evaluators who wish to give an extra convincing evidence foundation for
program appraisal and decisions. Other procedures that could be utilized are –
multiple-regression analysis or process tracing.
The analysis methods usually have importance on either on casual impacts seen over
a lot of cases or on producing a clarification of results in cases (Simons, 1996). To
accomplish both the goals, instances are there, wherein the focus of evaluators is on
synthesizing the evidence. Thus, comprehending the proposition of the analytic
approach is required by the evaluation managers and make sure that the techniques

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embraced tackle the planned users’ required information. How and why specific
results are being delivered are known using comparative studies; in a lot of cases the
impacts of specific factors are being identified by the statistical ways to casual
attribution, however, might not focus on concerns across or within contexts of the
cases (Stake and Robert, 1995).
The comparative case studies IBM and Accenture Blockchain are analysed with the
help of data which is collected for each company.
The analysis also includes a comparative study of various types of Paper-based bills
of lading and Electronic Bill of Lading in the Shipping Industry and compares them
with IBM’s Blockchain technology. The three types of comparison include a Paper-
based Bill of Lading, an Electronic Bill of Lading and Blockchain technology with
the use of smart contracts. The analysis covers to examine the brief concept of
various types of bills of lading and how Blockchain technology is different. It
includes essential aspects of a Bill of Lading right from how data input takes place,
how data is stored, examples of companies operating in each technology. The
comparative analysis compares various process related issues as pointed in literature
related to Trust and Visibility, (Transparency, Validity of transaction, Reliability),
pertaining to efficiencies, (Time and Costs Savings,) issue related to Security,
(Confidentiality, privacy, hacking, auditing) in Paper-based Bill of Lading and
Electronic Bill of Lading vs Blockchain based E-BoL.
5.3 Research Ethics
While doing a comparative Case Study, many ethical issues should be tackled. The
critical problem that has to be addressed is that the degree of depiction needed to
depict the cases’ richness might imply that the facts and the applicants involved in the
affairs are personal (Vogt and Paul, 2011). This isn’t a real issue; however, it should
be undoubtedly talked out and consulted with the applicants involved in the cases.
For the comprehension of the fact the data those are not important might be altered
and, in the report, a descriptive message should be incorporated to demonstrate that
to secure the identities of the applicants this has been done. In this Case Study, no
interview was undertaken, and all data are collected from secondary sources and

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discussion given by company executives on various newspapers. Hence there is no
need to consulting participants of IBM or Accenture. However, all information is
referred precisely so, that there is a link as to from where data is collected.

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6 Data Presentation and Analysis
In this research, we will examine IBM and Accenture as top two companies into
Blockchain technology. IBM has taken first big step in Shipping Industry along with
Maersk Shipping to explore the Blockchain Technology while Accenture seems more
suitable for financial sector but has potential to compete for IBM’s Blockchain
technology (IBM, 2017a). We also examine BoLero and SWIFT which are the two
companies who help in providing E-BoL implementation for the Paper-based BoL
companies.
6.1 Case 1- Digitalised Blockchain Maersk (IBM Blockchain)
An association that was created between the most prominent shipping company of the
world and IBM shall result in technological development that will reduce cost and
result in savings in the logistics industry. Maersk Line and IBM say that almost all
the goods in the global trade business are exported by ship. The Blockchain solution
that the firms use shall go by way of digitalization, help in keeping track of
consignments and deals and eradicate paperwork (IBM, 2018c) and shall be a
considerable revolution and will be helpful for the companies that had maintained
paper records of all their trade and enable tracking of their consignment. All paper
documents like agreement, bills, customs documents, and reports, etc. shall be
digitalized. As per Maersk and IBM are of the view that the entire documentation
process, when done on paper, sums up to 20% of the total cost of transit. Further, if
any document is lost, the entire process and agreement get delayed. The Blockchain
technique shall bring in digitization and there will be the real-time movement of all
the materials and shall connect all the elements of the Supply Chain with online
medium (Dignan, 2017). Making use of Blockchain in the documentation process had
various benefits. Maersk had been working in coordination with the IT University of
Copenhagen for technical development and to authenticate the digitization of freight
bill. This shall remove papers from the entire Supply Chain thus reducing cost and
time of shipping process as a whole. Blockchain application to Supply Chain shall
help the port and other parties of a Supply Chain to keep information of various
consignments along with reducing paperwork, time and cost of transit and giving
real-time information to all the stakeholders. Ibrahim Gokcen, the chief digital officer

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at Maersk, said that this digitalization should bring about a substantial rise in the
trade. He said that bringing this technique shall substantially decrease the cost and the
documentation time which will enable other players from the developing as well as
developed countries to get into the trading business.
According to Maersk, a consignment of frozen goods that are transported from East
Africa to Europe might be rotated among 30 people that might have nearly 200
different types of communication and exchange among themselves.
Figure 7 Issues related to Paper-based Bill of Lading
Source: (IBM Blockchain, 2017b)
IBM Blockchain Process example consignment of Roses
A consignment of roses is transmitted from Kenya to Rotterdam shall result in a
paper pile which is 25 cms in height. With digitalization, the arriving shipment can
send all relevant documents, bills, current location and position, estimated time of
arrival, etc. to the customs and port so that the port can be prepared, and the
unloading process will be must faster and will be done swiftly. The ports shall also be
equipped with auto- document verification tool which will make the process faster.
IBM Blockchain incorporates in operations like letter of credit, Bill of Lading and
Phyto-sanitary clearance for perishable goods being shipped from Malaysia to
Germany.
Figure 8 Blockchain Tracing Container Journey Improves Transparency and Security

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Source: (Maersk and IBM Blockchain, 2018)
The Blockchain auto-generates a receipt once the letter of credit is received by the
flower grower in Malaysia. The next leg is when the flowers are to be shipped
however there is a need for Phytosanitary clearance from the Malaysian customs
which has to be accepted by Germany customs. Authentic nodes have got
authentication rights. These rights are given to the bank, the ocean carrier, and the
sourcing and end port authorities. Other elements of Supply Chain like secondary
banks, customs officer, exporter, and importer are given both read and write rights. It
starts with the bank that has the power of authorization shall initiate the letter of
credit by a “smart” contract. Letter of credit is nothing but a guarantee that the bank
takes saying that the importer shall be paid for manufacturing and export the goods.
In addition to the Blockchain, all the authentic nodes verify and validate the letter of
credit digitally.
The customs have to write rights, and so they can register the clearance certificate on
the Blockchain. This clearance certificate uploaded by the Malaysian traditions can
be seen by the Malaysian grower. They cannot see the importer’s letter of credit as it
is a confidential transaction between the importer and their bank. This is followed by
forming a Bill of Lading by the Ocean barrier. This bill of arrival shall be auto-
generated by using the data that has been collected in the Blockchain database. On
receipt of the trucks from the grower at the port in Malaysia, the port authority
confirms the receipt of shipment and the exporting port as well on the arrival of load
on the Blockchain. The ports can only access data that is relevant to them. The
German customs inspect the containers and give them clearance on the Blockchain
with details about the fees to be paid after approval of vessels. Information on the
receipt in the buyer’s vicinity is also updated on Blockchain thus giving an auto-

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popup for payment to be transferred to the exporter either directly by the importer or
by their bank.
A simple consignment removes the effect of drayage at either end, the job of a freight
forwarder and giving away the paper documentation in the process (Cuomo,2017).
Other activities like supplying raw material for manufacturing, quality certificate at
the exporting port and the delivery of goods to the buyer shall also be included. All
the above could be part of the Blockchain as the main aim is to ease the entire
process which provides for ease in documentation till the payment after export
however not all become a part of the Blockchain. As told to American Shipper by
Srinivasan Sriram, founder of Blockchain technology provider Skuchain said that it is
not necessary for all the elements of the Supply Chain to be a part of the Blockchain,
if only 2 or 3 essential elements become part of the Blockchain then too they will
save on cost and create value. Every item that joins the chain adds value to the
process as a whole.
As per Maersk and IBM, both the firms have been working with various business
units, a logistics company and government officials in testing and bringing about this
revolution of digitalization in the Shipping Industry which shall be brought live by
the end of the year (IBM, 2017b). This resolution is decided by information received
by Linux Foundation’s open source Hyperledger Fabric. IBM is a member of
Hyperledger consortium which is a trust that works on the application of Blockchain
for cross-industry projects. IBM has been competing to have the best coders that
could give rights to Hyperledger using the IBM cloud and hackathons. Blockchain
can be implemented post-agreement from all the parties of the Supply Chain as
information once updated cannot be deleted from the system (Hyperledger , 2016).
Blockchain has information about any transaction ever performed using the system.
Hyperledger is an open- source group of industries created by the Linux Foundation
and is the most prominent place where Blockchain is built.
IBM and Maersk had made various technological advances in the Shipping Industry
by way of analysis and technical know-how to help firms to do real-time tracking of
their consignments that are being shipped to other countries. All the parties of Supply
Chain like importer, exporter, customs officers, port operators, shippers, etc. shall
have access to all the information updated on Blockchain basis the rights given to
them (IANS, 2017).

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The phase one of their launch in 2018 shall cover two main elements which will be
digitalization of the entire process in Supply Chain and removing paper documents
from trade. This shall enable all users to upload, submit, authenticate and authorize
all the records from across the border in real-time basis.
White (2018) said that the elements of a Supply Chain in the Blockchain should make
sure all the required approval and authorization are done on time with least or no
errors. It also enables real-time tracking of the consignment. Having real-time access
to this information is essential. It is necessary to keep record of all the transactions
that are done for a shipment but what is more important is to have access to the
desired information as and when required so that the shipment arrives on time
(Gurdus, 2018).
6.1.1 IBM Hyperledger for Standardization and Scalability
The joint improvement of measures is essential, regardless of whether on an industry,
national or worldwide level to maintain a strategic distance from clashes between
various principles and guarantee the ideal result. Terminology, development,
deployment, and security are the four major phases incorporated in the
standardization of Blockchain (Hyperledger , 2016). Since IBM’s Blockchain
doesn’t involve any tokens and is semi-centralized, it isn’t considered to be a part of
the Bitcoin universe. The Hyperledger project addresses some of the issues in
Bitcoin and Ethereum network. Hyperledger Project is a collaborative cross-industry
effort committed to the movement of Blockchain advancement. Ethereum isn't
extremely secluded. It should have been more business and administrative agreeable
Blockchain framework. IBM along with Linux Foundation, who has a remarkable
reputation in managing open source projects, began work on the Hyperledger
project.
The Hyperledger project is a foundation or like a democratized establishment rather
than a decentralized ecosystem like the one in Bitcoin and Ethereum. In Hyperledger
project A new member must be endorsed in agreement by all the existing members.
Jerry Cuomo, the VP of Blockchain technologies in IBM had a vision to the
reimaging the Blockchain technology, with the Hyperledger project they seamlessly
enhance the framework and integrate different functionalities called “Fabrics.”
Hyperledger Fabric is execution of Blockchain advancement that is arranged as a
foundation for making Blockchain applications or plans. It offers some fragments, for

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instance, accord and enlistment organizations, to be a connection and play. It utilizes
holder development to have keen contracts called "chain code" that include the
application method of reasoning of the structure (Hypetledger, 2017).
The design Philosophy is being followed by each project of Hyperledger which
incorporates a token agnostic approach without any local cryptocurrency,
emphasizing oh high-secure solution, interoperability, a general modular method and
the improvement of an easily used and enriched Application Programming Interface.
The API interface is enabling the applications and clients to Blockchains
(Hypetledger, 2018).
Hyperledger is defining basis useful segments and the interfaces amongst them in
this modular method that enables independent modification of any part without
influencing whatever is left in the framework (Hypetledger, 2018). Specific essential
segments are and will be defined by the working group architecture for the authorized
Blockchain systems such as inter-operation, Application Programming Interfaces,
policy services, identity services, crypto abstraction, data store abstraction,
communication layer, smart contract layer and consensus layer. For all the project of
hyper-ledger, a comprehensive orientation design for agreement is being shared by
the architecture working group.
6.1.2 Security in Blockchain
Access to the information on the application made by IBM and Maersk will be
strictly based on permission and not on an open platform like that of bitcoin here all
have access to all the data. Gopinath said that all the element in Blockchain would
have limited access to data based on the need of the process.
Security is a crucial part of the Blockchain (Carlow, 2017). In a distributed ledger, all
the elements in the Supply Chain shall have access to all information whether it is of
use to them or no. However, this is not how the setup should be. The concept of
restricted access keeps data secure from external sources and maintains privacy.
Information like a cost of shipping, pricing or the ocean carrier, or the seller can
cover the name of the main dealer. This makes the entire Blockchain secure by giving
the elements of Supply Chain access to the information that will be of use to them.
As per Desilva (2017), Blockchain allows firms to come together and work in
synergy to reduce cost. Most firms are technologically developed after receipt of

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goods however they need to work on goods shipping and availability of products for
sales. They need to work on the same and get real-time tracking of the imported
goods. This shall be done by the simple and easy concept of Blockchain which has
the conventional technology for the same. The data updated on Blockchain is owned
by the person uploading it, and so correctness of status is based on the data (IBM,
2017a). This also makes payment among all the levels of trade a more
straightforward, faster and swifter process.
IBM in coordination with other parties has been working for the development of the
industry along with setting up a garage and having an accelerator programme so that
the client can test Blockchain for their process in a systematic environment (IBM,
2018c). IBM is the market leader had made massive investments for technological
development and has made a vibrant client base by servicing Walmart for improving
food safety and with Northern Trust a financial service company and enables them in
providing better customer service. The Blockchain Technology by IBM is a fit for
organizations of all sectors like banking and financial services, export-import,
logistics and healthcare (Sandell et al., 2016). It was a massive revolution in the
cryptocurrency sector. The Blockchain Technology has brought about a change in the
old process that was used. It is facilitating with the best marine insurance which shall
become the future of this business
6.2 Case 2- Accenture Blockchain
In September 2017, Accenture had received an award for a patent it created for its
work in the “Editable Blockchain” technology sector. This technology was designed
to allow all the stakeholders to alter or edit the data uploaded on the portal in case of
any error or during fraudulent events. These technological developments shall enable
Blockchain to reach maturity. Accenture is of the view that edit rights should be
exceptional and given to a restricted number of people only as it is a very critical
element to be used in perilous times only (Carlow, 2017). It could be given to trader
that has sent the incorrect amount to a client dealing with the hedge fund. If not
rectified immediately this could make a significant impact on the business. This right
might be given to a secret person that manages the key, and it could be form one or
more stakeholders. It could also be that it could be collective rights and all the people
having such rights need to approve of the changes before getting into action.

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Alliances are essential but as per Accenture’s record of having edit option in the
Blockchain where the data uploaded could be easily altered or edited could lead to
frauds and misuse of data (IBM, 2018c). This shows that the data is not safe, and all
companies want their data information to be safe.
6.2.1 Controversy related to Accenture Editable Blockchain
The concept of Editable Blockchain has not been accepted very well by the industry
and has got some critics as it might give the financial sector a chance for rectifying
the manual lapses done at their end, but this removes the whole essence of
Blockchain which is immutability or unable to change (Dignan, 2017).
6.2.2 Editable Blockchain
As mentioned by Brian Kelly, BKMC LLC founder and CEO Immutability is the
main characteristic of a Blockchain and then arise a question of the need of
distributed data if the Blockchain can be edited. It is because people are of the view
that editing Blockchain data could be much more significant than mere rectification
of errors and it could lead to data tampering as well. Some are of the opinion that if
the edit option is not available on the Blockchain, then it might not be able to meet
the ever-changing and growing needs of the customers and the industry on a whole
(Hacket, 2018).
6.2.3 Immutable and Private Blockchain
Accenture aims at making Blockchain much more comfortable and safe for
businesses to use by locking away or freezing the area that they use to sign deals
(Lumb et al., 2016). By use of this technique, Blockchain shall create a platform
which will make use of Thales system and security techniques. With Accenture’s
one-click installation solution, companies will be able to restrict any code creation
happening anywhere.
Immutability of Blockchain shall be helpful in public Blockchain sector as the data
there is open to all and anyone can view and edit the same.
Financial companies are not very keen on having a public Blockchain with
immutability or no edit option. They consider data security much more critical as
compared to immutability (Sun et al., 2016). For them, Blockchain had to be applied
in precise and planned processed, and they do not need to hide any data or
information. Therefore, there is no need for the zero-trust feature of the public
Blockchain. Financial companies have decided on having a personalized private

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Blockchain for their industry with the partners they trust so that they can determine
their own set of rules and regulations wherein the members will decide the way of
doing a transaction. They shall also give the members (by way of majority) the right
to change rules as and when required. Like altering the rules; the members (by way of
majority) also will have the right to cancel or reverse any transaction that was not
correct or appropriate. This is the leg where Blockchain will be edited. This will not
be modifying a deal but changing the old one by creating a new counter transaction.
Accenture also aims at the same and wishes to give edit option just to edit and rectify
a deal so that it does not impact the reliability of the Blockchain as a whole (IBM,
2017a). Even though financial sector wishes to deploy editable Blockchain, yet it has
some restrictions. It includes managing edit rights to sharing keys and managing
access rights of employees.
Accenture’s Blockchain hardware could also address this problem. The hardware
development done by Accenture shall be capable of bringing more changes till a
decade and shall be used in big industries for Blockchain technology setup (Carlow,
2017). It shall be helpful for healthcare, insurance, Finance sector, government and
semi-government organizations thus reducing the scope of potential cyber-crimes and
thefts. David Treat said that Accenture is in the development phase and could
consider any are like HR, IT, legal and compliance or frauds along with maintaining
their cryptographic characteristics. People from various industrial sectors have shown
keenness in application of Blockchain technology and so have got requests to
disclose the industry that we are exploring for such developments (Duberstein, 2018).
Figure 9 Blockchain Smart Contracts in Accenture

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Source: Accenture, 2018
Accenture focuses on a lot of things. It is not only a member of Ethereum Enterprise
Alliance but is also part of Hyperledger project. It also has alliances with Ripple and
Digital Asset (IBM, 2018c). Accenture was also a part of the Chamber of Digital
Commerce (CDC) which is the most significant Blockchain association across the
globe. CDC aims at educating and sharing knowledge, promote and create awareness
among people thus result in the growth of technologies that make use of Blockchain.
Among the other Accenture is also the founding member of the smart contract
alliances, the global Blockchain Forums, the Blockchain Alliances. As against IBM
(Hyperledger Project and Digital Asset) and Microsoft (Ethereum Enterprise
Alliance and Ripple) which are very outgoing in their aims and Accenture aims at
bringing in all kinds of DLT innovations for making technological development that
helps the firm (Hyperledger , 2018).
Accenture thrives on leading the Blockchain development industry and it is of use
and practically applicable to the real world (IANS, 2017). They aim at providing our
customers an overview and demo of the Blockchain based technology and the impact
it could make on the business.
Accenture also gives a lot of importance to data security as they foresee that it will
play a huge role in the application of Blockchain technology. Accenture brought out
new Blockchain security hardware in February and in September 2017, Accenture
had also applied for patent rights for the editable Blockchain technology that they had
set up. Along with Thales e-security and their hardware security module (HSM),
Accenture found a technique by which their Blockchain could easily be incorporated
in the systems of any organization, and this could be done with the help of
Hyperledger Fabric (Hyperledger , 2016).
Over and above the expectation of generating, safeguarding and remembering
essential pins and keys that could be used as transaction passwords, the device also
manages the access rights of individual critical data available on a particular network
(JOC, 2018). The firms need to follow strict rules and regulations so that they get
access to the Keys saved on HSM and it is by collecting all keys in their system and
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6.3 Issues related to Paper-based Bill of Lading
In international trade the documents accompanying in the transport of goods like
insurance, financial, legal and commercial documents are very important to make
sure of timely and correct delivery, to give proprietorship or authority of merchandise
and amongst the seller and buyer making the transfer of obligations and rights easier.
The original BoL is the most significant amongst the documents, which at the same
time acts as the dispatched merchandise’s receipt, as a merchandise’s title and proof
of the agreement of carriage among the transporter and the shipper. The possession of
the merchandise’ consignment is being represented by the negotiable BoL and it
compels the transporter to transport the merchandise to the holder of the documents.
On the other hand, in the goods’ movement as well as in the transport and issuance of
trade documents there are numerous incompetence’s due to the logistical
complications in the procedure of shipment transfer and the failure in noticing the
restricted process.
Amongst the parties the absence of harmonization and synchronization disputes gives
rise to the complications in trade assistance and also the requirement of numerous
touch points in managing administrative, operational or monetary process over the
chain in transport. The expense for the purchaser and the risks in delivery are raised
due to the inefficiency being created by these mechanisms in the transfer of goods,
information and documentations amongst the applicants of Supply Chain.
6.3.1 Delivery Risks
To get on time signals of probable damages and delays as well to assess the date of
delivery it is necessary that while the shipment is in transit the buyer should obtain
visibility as inadequate shipment visibility would impact accomplishment of
downstream commitments. Most of the time, but, the goods’ arrival is being informed
to the importer just few days prior to the arrival of the shipment at the destined port.
For instance, the information related to shipment, the documentation needed for the
clearance of custom and pick up at the destined port and the arrival notice of a cargo
might be sent by a sea cargo bearer. But at the same time any kind of delays

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happening on the way of shipment or due to change in route, port congestion or bad
weather any damage happening might not be awarded by the importer. Due to lack of
proper documents, likewise, the importers also don’t have proper information
regarding the postponement or misfortunes in custom clearance at the disperse port.
The shipment might be, at the worst condition, misplaced and delivered to incorrect
destination or stolen or lost. The capability of the importer might be significantly
limited due to such delays in foreseeing and mitigating the risk associated with
business and thus has significant impact on business.
Figure 10 Issues and Risks in Paper-based Bill of Lading
Source: Cognizant,2018 (Varghese and Goyal 2018)
6.3.2 Increased Costs
In trade finance, one more pain point because of the inadequacies of documents is
cost along with postponement in trade documents’ flow. For international trade the
formation and authentication of insurance, regulatory, finance and commercial
records could include close to fifty distinctive parties, comprising regulatory
agencies, inspection institutions, custom authorities, chambers of commerce, port
operators, insurer, carrier, freight forwarder, facilitating banks, exporter, and
importer, all are accountable for altering, validating, and issuing various documents

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related to trade. Annually, it is being estimated in studies that, in handling trade
paperwork cost is USD$420 band at times, close to 5%-10% of the aggregate
estimation of the exchange. Until the original documentation is being received, the
goods couldn’t be claimed by the buyers as along with the shipment of goods the
documents don’t move along. This consists of the BoL that is required to declare the
assets at the time of delivery from the carrier by the final possessor or seller.
Therefore, to receive the documents or BoL needed for clearance of customs there
could be a delay in time, which further results in delaying the disperse of goods to the
purchaser and thus increases the risks and cost associated with delivery. Custom
delays could happen for many days yet for small mistakes like in case of mismatch of
the address of the consignee in the business invoice and shipping manifest, or the
specific weights mentioned in the BoL and packing list is not matched, or in case of
no signatures in the documents. The shipping line could charge extra demurrage cost
from the importer along with more price could be involved in storages at the port, and
additional cost due to losses or misplacement of cargo, all these happens due to the
delay in asserting the shipment either because of issues related to customs or delay in
getting the original documents.
6.3.3 Loss from Documentary Fraud
However, one more worry is fraud in a documentary that happens when
vulnerabilities in a chain of transport are misused to assure the fake groups
wrongfully. The documents could be easily manipulated by the fraudsters because of
many reasons like due to the absence of security and rational principles, for the
decision making entirely depending on the trail of document, difference in the trade
procedures and regulation of different countries and amongst the parties the varied
interactions result in complications in the operation of business. Among all the
marine fraud around 40% are estimated to be of particular kind of documentary fraud.
There could be different types of scams happening like shipping sub-standard goods
instead of valuable assets, the infringements in the agreement being hidden, to clear
the custom, the original documents’ information being altered or faking of necessary
documents. For example, to avoid the peak-time charges the exporter may stack the
freight afterward compared to the date mentioned in the agreement, however, gives a
pre-date BoL in order follow the terms related to timing, whereas the importer would

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get the goods delivered late. At the destined port a fake third-party, for instance,
could forge a BoL to claim the cargo before the importer could claim. As there is no
visibility of the operations of transport by the financing banks or purchaser these
kinds of issues happen. Earlier efforts to create title documentations like BoL
paperless using trading systems, Electronic titles and telex release have confronted
various acceptance challenges along with technical and security execution and have
just possessed the capacity to deal with restricted facets of the issue.
There are three main risks in paper-Bill of Lading such as risks related to delivery of
goods, risks or increased costs due to delay in in documents and fraud which might
be caused due to loss of records by accident or intention.
6.4 Case 3 -BoLero (Electronic Bill of Lading)
In the Electronic trade documentation’s journey, the turning point came with the
attempt of BoLero. This is for the reason that where the above-discussed experiments
were limited to the BOL, the aim of BoLero is at giving a protected domain for the
Electronic trade documents’ exchange.
BoLero worldwide has been depicted as one of the most significant studies of legal
into Electronic commerce along with presents opportunities for having complete
paperless frameworks and enhances the customer service and be cost effective as
well. In 1999 Sep, the BoLero system came live and depended broadly on its Rule-
Book. For the BoLero system to be used the precedent condition applied is that the
involved parties should explicitly consent to the utilization of the Rule-book of
BoLero. The legal impact of BoLero BOL and the Electronic transactions’ validity
are the essence being governed in the Rule-Book. Using eBLa practical and
intelligent method is being devised by BoLero to achieve essential negotiability.
By merely making the transporter a bailor with beneficial ownership of the
merchandise the helpful owner’s transfer is affected. The methods of novation
jeopardize the carriage’s exchange of the agreement and the rights originating from
it. BoLero has been designated as the agents of the bearer who in every consecutive
agreement is the regular party. On the bearer’s behalf, subsequently, BoLero with the
new transferee changes each deal. At www.BoLero.net all the details regarding how
BoLero BoL functions are mentioned. It is thus understandable that without the usage

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of paper negotiability could be accomplished. A great deal of commendation and
attention is deserved by the BoLero’s activities as well as in the international trade
practices a very significant effort at Electronically replicating the paper documents’
functions.
Cloud-based, end to end and secure services are being delivered by BoLero which
digitizes the transactions and trade procedures, giving more control power,
transparency and visibility and thus makes the trading faster, smarter and safer. The
EBLapplication of BoLero which is accepted and acknowledged worldwide
empowers the logistics and carrier providers to make digitally, send, alter and control
the BoL with more prominent precision speed and reliability. By this, the probability
of any probable mistakes, administration cost, and frauds are being lessened. The
Electronic Bill of Lading by BoLero is a compelling mix of technology and legal
structure that recreates the conventional paper BoL’s core components, a specifical
record of title, contract of carriage’s proof and the BoL’s capacities as a receipt.
• To control, make, transmit and revise the eBLand ocean way bills
• From formation to surrender to complete audit trail and visibility
• Securing the enrolment and verification process.
• A title registry and legal framework is used
• The International Group of P & I Clubs recognizes and accepts it.
• Capability to be coordinated into already available bearer front-back office
frameworks
• Maintain transporters movement to e-business answers for their clients
The end of the year 2017 shall result in the International Group of P&I Clubs backing
three Electronic trading systems: BoLero International Ltd., E-title Authority Pvt
Ltd., and essDOCS ltd. All the above have a set of user agreement that all the parties
of Blockchain have to sign and get into a legal contract which will explain the parties
their rights and duties while making use of digital titles like BoLero International
Ltd., E-title Authority Pvt Ltd. and essDOCS Ltd's Databridge Services & User
Agreement, etc.To avoid multiple or cross trading, they make use of modules7 of
hardware security. The make use of the peer-to-peer technique to transfer E-title of
Electronic bills of lading. BoLero and essDOCS have central registries to manage the
transfer of title and E-BoL of shipping. BoLero got into an agreement with Fintech

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consortium R3 in November 2017 so that it could revamp the Electronic Bill of
Ladingprocess and bring in Blockchain technology into action.
6.5 Case 4- SWIFT
BoLero is the combined endeavour of TT Club (Through Transport Club) and Swift
which is the Society of Worldwide Interbank Financial Telecommunication.
Minimizing operational risk and following the rule and regulations of the strict
regulatory framework are the two significant challenges faced by the corporate. There
is a need for proper management and improved efficiency for meeting these
challenges. Because of this reason the corporate always tries to centralize and
automate their work activities. This helps them to face the challenges from various
platforms and interactive sections in a controlled manner while starting the
automation with banks. This scenario is costly, and the corporation could not afford
the processing and maintenance charges. In addition to these costs, the risk involved
in this system is very high because of its heterogeneous nature. As stated by Mark
Jefferson, the director of operations of America there is a need for a secure
mechanism for exchanging the information and doing the transactions through the
trade chain. To resolve all these kinds of issues, Swift introduced Swift for the
Corporate offering. This application enables the corporate for using Swift’s reliable
and secure communication platform provided by their financial institutions like cash
flow management or trading services. Thereby the corporate firms can minimize the
cost and risk of work process, increase the security credentials, and optimize the
liquidity management
Swift has a secure network of bank-owned corporate with messaging services 6500
financial institutions among 181 countries. 2 trillion-dollar messages are handled in a
day by the Swift network. In a Bank trade conference held in World Trade Centre,
Mr. Jefferson informed that BoLero is following a unique way for communication
exchanging the information among the corporate. Bank trade introduced by Complex
Systems which automates the letter of credit. Bank trade accounted 30% of all the
trade finance messages and sent to the Swift Network. Swift Certified Application for
Corporate – Processing and exchanging of trade flows like documentary credit

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service advice, application for issue of L/C (Letter of Credit) that are handled by the
business application which is supervised by Trade and Supply Chain Finance Label.
After technical and functional verification done by the swift experts from a corporate
back-office and further successfully transferred to the corporate. There are a specific
set of business functions for processing the information which is distributed over
SWIFT Net offered by the applications. The primary target of the form is to facilitate
the technical integration and reformatting of third-party applications. The app also
performs standalone EAI (Enterprise Application Integration) without qualifying any
further quality constraints.
Figure 11 SWIFT Architecture
Jefferson stated that BoLero is not going to stop the bank transactions entirely from
processing the trading transactions. By using this application, it will be easier for the
corporate to do their financial transaction and for extending their product offerings.
Jefferson also added that Banks could continue their trusted intermediary role for
doing the international trade operations. Andre Cardinale, Senior Vice President of
Complex Systems, mentioned that Electronic trade document would get delivered by
BoLero without processing the information included in the papers. Chairman of
Complex System Gad Janay noted that it is the responsibility of the Banks to
integrate the customer's systems through an e-commerce chain. He also added that
our vision is to introduce a fully integrated system for tracking the purchase orders
produced by customer, or different kinds of transaction information of vendor,
products, etc.…, automatic generation of letter of credit (LC) if requested.

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6.6 Benefits of Electronic Bill of Lading over Paper-based Bill of Lading
6.6.1 Letter of Credit
A smart, fast and safe method is being offered by the solutions of BoLero to
supervise the Electronic presentations and LoC centrally. Using a standard digital
network the carriers, banks, sellers, and buyers could Electronically trade LoC, eBL,
other trade documents and insurance documentation. More prominent visibility and
control is being delivered by the solutions of BoLero to enhance the operational
effectiveness, lessen the bank fees and open working capital and also gives exchange
fund as well as empowering the treasure groups to supervise their credit-lines and
headroom to considerably better resistance as compared to the past.
6.6.2 Supply Chain
Financial institutions are being enabled by the supply-chain solutions of BoLero to
give the dealers and purchasers the capacity to mechanize and digitize their
receivable procedures and records payable. To more effectively deal with their
suppliers and customers it provides them adaptability and offers beneficial
exchanging terms. To mechanically approve, match, process and validate the
purchase invoices, orders and other trade documents could be uploaded
Electronically. It gives adaptability to the sellers and the buyers to finish the business
deal and requesting from the financial organizations feasible funding.
6.6.3 Documentary Collection
Documents are digitally presented to the reliable third-parties or banks by the BoLero
solutions in favour of the goods’ transfer and the trade’s settlement as indicated by an
arrangement of characterized guidelines. From the starting phase to the last stage of
payment the companies could safely track the records, handle and submit. Going for
digital speedup the recompense enhances income and the arrival of merchandise and
additionally reduce the functional expenses and overheads.
6.6.4 Guarantees
Companies are empowered by the BoLero solutions to supervise bonds and
guarantees centrally from various finance organizations with total visibility and
control and thus reduce the threat of probable deception, mistakes, and expense of
credit and management. Electronically the guarantees could be accumulated, revised
and maintained with updated data on their status when they terminate, the elements

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and value included. Companies could be known as aspirants, beneficiaries or both.
The whole procedure is quicker, extra dependable and safe, thus reduce the
substantial expenses of stock up and administration.
6.6.5 Integrity and Security
For the whole trading group, the Cloud-based platform of BoLero conveys safe and
consistent availability. Using secure online interface, the transactions of the users
could be rapidly tracked, accessed and managed. Business is ensured to be traded in a
trusted, secured and safe environment by the BoLero’s transaction reliability, non-
revocation of all transactions and complete different administration. To associate
with BoLero’s applications in a manner which fits the business of an organization the
solutions are built and designed to provide the organizations the flexibility and
power. Third-party applications are integrated into the platform of BoLero to use our
chief abilities.
6.7 Issues in Electronic Bill of Lading
At present inside the business community, however, BoLero is enduring the
progression of attaining recognition. On a daily basis, many companies are opting for
BoLero including certain significant players of International Maritime Commerce,
which could be revealed from the website. But the site couldn’t update us regarding
how many companies haven’t opted for the BoLero. Moreover, the acceptability
issue from one more viewpoint is raised due to the significant impact of US/European
concerns. With the parallel systems’ advancement with the regional lines, this issue is
additionally exaggerated. Trade and Settlement EDI is one of those frameworks
which are fundamentally an affair of Japanese.
Another issue might arise from anti-competition actions, in case of a union amid
these two frameworks. One more concern is that in spite of the success of BoLero to
provide a no paper condition for trade records. Still, there is the issue to give the
sentiment related to the comfort of paper. Even the consideration of the reliable
quality of writing is in power. Before issuing L/C, the Banks still demand to show the
article BOL, in the trade financing field. The Banks’ insist on the paper BOL is
approved alongside the transporter who might likewise require from the bearer the
issuance of paper BOL. For the BoLero’s success, the following couple of years are
exceptionally crucial and, in a division, wherein the chances are extremely high the

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mission of BoLero to propose a worldwide Electronic system has correctly been
portrayed as “BoLd-gambit.”
From the legal infrastructure side, there must be necessarily adequate support for any
E-BoL to be active. It is the same as recognizing, in the nonexistence of engaging
legislation, that a Paper-based BoL would just be a bit of paper. Giving an instance it
could be comprehended better - assume that for a sale agreement the parties involved
have settled on using an E-BoL and the carriage agreement has been concluded by
the dealer under which the transporter decided to give a particular BoL. Among
themselves, their activities would work. Usual solutions would be available if there
would be any breach of the agreement. But the third parties are not affected by their
actions, in the nonexistence of help from the relevant lawful frameworks. Therefore,
the purchaser might not be empowered by these kinds of activities to declare his label
next to third-parties like other purchasers who purchased from the similar vender the
similar merchandise, the trustee of the insolvency domain of the seller or a seller’s
creditor grabbing the merchandise. The absence of adequate help from the legal
foundation determines the E-BoL’s projects past and present, that results in the banks
being reluctant to acknowledge the E-BoL as a satisfactory deposit. In the same
format, the BoL based on Blockchain would not spread until its get adequate help
from the relevant lawful frameworks.
Digitalization shall make processing more comfortable, however, bringing this
Electronic Bill of Lading into practicality requires a lot of technical challenges along
with facing regulatory issues and problems to get the digital copy accepted as a
contract by the various regulators and parties of the Blockchain. The E-BoL should
be made equivalent to its paper bill so that all the parties get their rights to the
agreement based on the E-BoL.
6.8 How Blockchain based BL is improvement over Electronic Bill of Lading
A Blockchain based Bill of Lading is more secure as compared to the present EBL
due to the fact that all the E-BL can be manipulated and there will be an increase in
corruption due to less transparency among all the parties involved. Whereas in
Blockchain based E-BoL all the payments and changes have to be approved by all the
acting parties so as to be defaulted leading to more secure and transparent EBL.

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All through the lifespan of a transferable document it should be one of a kind
document. It is a ‘guarantee of singularity’ or ‘guarantee of uniqueness’ feature that
is very much needed to make sure that the document’s holder only can practice the
privilege to assert the execution of the commitment. In an Electronic situation, this
kind of feature is not easy to recreate because an Electronic document could be
replicated to make a vague copy. By a trustworthy unit through a vital registry
administered the guarantee of uniqueness in an Electronic situation could be possible,
was the thought until recent years. A perceptive author on the other hand has pointed
out that ‘at least in the hypothesis, if advance computer technologies would be able to
make a one of a kind Electronic document a similar outcome could likewise be
accomplished that at certain time during the negotiation chain could be solely grasped
by a possessor and exchanged to another’.
Guarantee of uniqueness could be provided by the Blockchain technology which was
concocted to ignore the dual expenditure. Precisely the techniques of Blockchain
don’t make excellent value-based documentation instead stays away from the
continuous exchange of copy documentation by facilitating an agreement to reach on
first amongst the contending transactions. As in 2011, this article was published it
won’t be appropriate to blame the author, a few years ago the Blockchain technology
was recognized in large scale even beyond the arena of information technology
experts. The transferable document’s vital component, the guarantee of uniqueness,
makes it an unusual exercise case of Blockchain technology. Also, as contrasted to
the current and earlier E-BoLs. The BoL based on Blockchain have additional
benefits.
Since 1986, in various efforts at digitization, the subjects have been the Bills of
Lading. They are consistently closed only member system by a central registry and
directed by a trustworthy mediator. All the applicants of the parties should be
registered members whoever wants to be engaged in the transaction that will be done
on a closed platform. The paper BoL will be required to replace the E-BoL
when there is involvement of a non-member. For the utilization of the E-BoL, the
membership prerequisite is recognized to be a significant hindrance. Therefore,
amongst the most significant obstructions, the trading partners’ absence of readiness
was one as per the survey was done by the United Nations Conference on Trade &
Development (UNCTAD).

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Figure 12 Issues in adoption of Electronic Bill of Lading
Referring to this survey, it has been observed by an author that ‘the user might trade
with non-members, even after obtaining the membership, by which the user might be
prevented from getting the benefits of the investment’. In the world trade where the
paper BoL is still predominant, not a single of the current systems of E-BoL appears
to be successful in accomplishing a significant group in their membership. In a
decentralized framework, the feasibility of guarantee of uniqueness is made by the
Blockchain technology, dissimilar to the current frameworks based on model of
central registry. On an open stage peer to peer transactions happens wherein no
earlier enrolment to membership is needed. This would be an important benefit as
extensive varieties of individuals are often involved in trading from various sectors of
industry like transport, banking and trading. This directness additionally makes sure
global reach of the applicants.
There are additional benefits of decentralization. The human mistakes that could be
done by the registry administrator are eliminated by decentralization. As there won’t
be any particular chance of failure it makes the structure less exposed to hacking
assaults or accidents. It additionally lessens worries regarding control by the registry
government or administrator. However, there will be certain major confronts in the
launch of Blockchain based BoL. Therefore, there should be exploration of feasible
business plans and technological details should be figured out.
6.9 Benefits of Blockchain over other existing Systems
Figure 13 Benefits of Blockchain Bill of Lading

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Source:Cognizant,2018 (Varghese and Goyal 2018)
6.9.1 Improving Visibility, Authentication, and Verification of Documents
As mentioned in Figure below, Blockchain could also make it easier to make, verify
and authenticate all trade documents by including all the elements of the Blockchain.
Like once the goods are loaded on the vessels, the system will auto-generate a
detailed sheet to be given to the customs officer at the port basis the data available in
the system and then it could generate the Bill of Lading once the clearance is
received. The importer can verify and authenticate the documents on real-time basis
or as the contract demands.
Figure 14 Blockchain Journey of Bill of Lading
Source: Cognizant,2018 (Varghese and Goyal 2018)

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On the other hand, there has been a lot of work on making the Electronic Bill of
Lading adding equivalent to that of the paper bill, or it's scan copies as it presently
has a centralized office that manages these copies. By way of the Blockchain, they
can have a control that all the parties will have access to only one version of the deed
that will be approved by all.
Along with it by use of smart contract, payments at various levels to the supplier,
carrier, at the port could also be auto-managed by the Blockchain after the service is
provided and the token is moved to the next level of the Supply Chain. The
completion is verified, and then the payments are made.
Digitizing the trade asset by way of a Blockchain gives its buyers authenticity of
delivery of goods as the buyer gets a real-time update on the delivery status of the
cargo and tracks any delays in delivery. This shall enable both the parties to manage
risk and have visibility on the level at which the deal is and reduces the scope of
fraud or theft.
6.9.2 Using Crypto tokens on Assets makes tracking easier
Using Crypto tokens and tokenization of the asset makes the cargo or the goods more
visible thus making tracking of products a more natural process. This makes
monitoring of consignment from the dispatch and loading stage to the shipping,
boarding, customs clearance and the unloading and delivery of goods. It could help in
tracking any delays in delivery, and the reason for it along with any technical and
political issue that a shipment has to face could be managed. It gives a real-time
update on the status of goods. All the risk managers that are banks, lenders and
regulators can also be controlled and be updated on the state of the deal and
shipment. This shall help in making appropriate arrangements and manage further
transactions that are based on the delivery of this shipment and have an efficient
operation. This process makes the entire Blockchain process more transparent thus
reducing the scope of theft and forgery.
6.9.3 Document Digitization leads to faster shipment release data
By way of Blockchain and digitization, the movement of physical document is done
simultaneously with the flow of goods across the value chain. This makes the transfer
of title faster resulting in faster processing. Regulatory and customs officers could
verify the documents online by way of Blockchain and then issue necessary bills and
papers and provide approvals on the Blockchain platform itself. Loss or misuse of

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paper agreements, verification and authentication of paper contracts and then getting
essential approvals will only further delay the shipment, and so Blockchain helps in
saving time and cost by using the digital platform for the exchange of documents an
for passing on approvals as and when required. The papers will be autogenerated
using the data available. All the documents shall be created as per the standards and
will be in sync with the essential points of agreement.
6.9.4 Information immutability Reduces scope of data mishandling
Transparency and information immutability shall reduce the scope of document
forgery and any cheating and forgery across the Blockchain. a.) Rather than creating
copies of the original physical contract or agreement, it creates a single digital text
that can be viewed by the parties that have access. This reduces the scope of forgery
and maintains data security. b.) All the parties of Blockchain have got specific rights
so they can view alley the data that is uploaded on the Blockchain however they can
edit only that part of the information that is relevant to them and is their
responsibility c.) By way of data immutability, the data cannot be tampered or
altered by any party till it has permission from the party that has uploaded the data.
All alterations are tracked. Tokenization makes it easier to follow the contract and
Blockchain causes transfer of data among various parties easier.
6.10 Challenges of Trade Finance resolved by Blockchain Smart Contracts
In the International trading industry, the trade finance services provided by the bank
and other financial firms are very significant as they provide assurance of payment to
both buyers and sellers and thereby creating a strong bond between the parties.
Flexibility and robustness are the two essential factors needed for the growth of 16
trillion-dollar international trade markets. Hence Trade finance is defined as the
backbone of global commerce. Participants of trade sector should be aware of the risk
involved in the financial transactions and other uncertainties which includes process
inefficiency, operational and logistics hurdles, dynamic changes in global trade
regulation and requirements. Based on a survey of International Chamber of
Commerce there is a high increase in legal dispute and deception in trade finance

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sector from past few years. This diminishes the growth of trade finance sector and
showing the low growth rate from 4 trillion dollars to 5 trillion dollars which severely
affect the growth of global commerce sector.
Through payment automation Blockchain technology ensures payment certainty. If
the individual financial transactions like Letter of Credit (LC) is an efficient way for
reducing the risk along with the facilitation of bank in trading and settlement process
which result in a reduction of high cost, delay in the contract and other processing
hazards. Letter of Credit is used for evaluating the trade documents which is not by
the actual delivery of products. LC helps the bank and other financial institution on
taking a better decision on the discretionary interpretation in case of interaction
which leads to an unnecessary argument between the parties and as a result the goods
dumped in the delivery location. Automation of LC helps to avoid all these kinds of
complexities and ensures reliability in the transaction. Smart contract is the modelled
version which provides payment methods and undisclosed trade contracts on
Blockchain and thereby providing payment indeed to the vendor.
Figure 15 Blockchain Smart Contracts addressing Trade Finance Issue
Source: Cogniznat,2018 (Varghese and Goyal 2018)
There will be a delay in the payment due to data mismatch among undisclosed trade
contracts and LC contract which needs a refusal or acceptance from the consumer.
Reasons for other delays are the correction in the trading document, alteration in LC

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with the short span of time before expiring date of LC. To resolve all these
complexities in payment delay or payment rejection LC is shaped as a self-executing
contract on Blockchain which ensures fast payment to the suppliers, prevent the
disagreement due to ambiguity in payment contracts. Payment automation also
accelerates payment through early detection of variation and also increases the
efficiency of adaption process. Automation of payment also reduces the mistakes in
payment and provides faster transfer of ownership.

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6.11 Comparative Case Study of Paper-based Bill of Lading Vs Electronic Bill of Lading and Blockchain Technology in Shipping
Industry
Traditional Paper-based Bill
of Lading
Intermediate- Electronic Bill of
Lading
Modern Companies using Blockchain
Technology
Generation 1 Generation 2 Generation 3
Type of Bill of Lading Paper-based Bill of Lading Electronic Bill of Lading Blockchain based Electronic Bill of
Lading
Meaning / Concept Bill of Lading is the primary
shipping document given by
the carrier as an
acknowledgment for the
shipment of goods. Three
conventional functions. First,
as depicted in it is acts as a
receipt for the products and
got by the transported for
shipment. Second, for the
carriage’s contract it is
considered as evidence. Third,
in regard to the products it
acts as a report of title.
Electronic Bill of Lading is
digitalisation of Bill of Lading
documents capable of creating
proprietary and tile of documents
through E-signature.
Blockchains is a type of Distributed,
shared, encrypted database that serves
as an irreversible and incorruptible
repository of information. With which
the integration into E-BoL making it
more transparent and secure.

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Data Input Internet/Email/Physical
Papers
Information is shared digitally by
way of Electronic data interchange
(EDI)
Application Programming Interface.
The applications and clients are able to
interface directly to Blockchains.
Data Storage Each company maintains their
own files, which includes lots
of paperwork
Individual Ledger Distributed Ledger
Example COSCO, Mediterranean,
SWIFT
Cargo docs, Sea docs, BoLero IBM: Hyperledger , Accenture,
Maersk,Wave,CargoX
Trust In traditional Paper-based Bill
of Lading there are issues
related to trust and hence
needs of large number of
intermediaries such as banks
and third parties involved in
transaction
The information obtained
from the modern Supply
Chain of the shipping domain
which is very large on
information and short on the
In replicating the elements of the
BOL by Electronic means the most
difficult part is in accomplishing
vital negotiability. There are
various reasons for this, the most
significant are – the BOLs being
regulated by the laws assumed the
utilization of paper in proprietary
rights or exchanging possession in
the products. This makes issues in
the eBL execution which intends
to forgo the requirement of the
• The Blockchain enables shared built in
trust amongst all the stakeholders
involved in a transaction minimising the
need of third parties or middle men in
Shipping Industry
• It is a democratised system where no
member controls the Blockchain as it is
a shared network and also can break
rules thus increasing Trust among
members
• There are lesser trust issues as all the
transactions with the help of

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assurance. Traditionally the
problems of trust among the
organizations which includes
fear about the information
leak or any other kinds of spy
works may cause harms to the
organization. Because of these
problems, the shared
information which is shared
among the organization is
cannot be fully trusted.
documents’ physical exchange.
Likewise, by simple endorsement
is the products’ possession is
transferred in multiple strings or a
string agreement.
All the parties are being enabled
by the solution to draft in
Electronic documents that are
accepted internationally like eBLs,
invoices, certificates of origin,
warehouse warrants and other
supporting documents that reflects
the norms and standards of the
wide industry.
permissioned Blockchains working as
peer to peer network as nodes
• The need of lesser trust leads to
elimination of large number of
middlemen such as Clearing house
agents, banks which take up lots of
costs involved earlier in Paper-based
and Electronic Bill of Lading
• The governance of Blockchains does
not lie with any one organisation. The
Blockchain works in a democratised
manner. Any new member has to be
approved by consensus of other
members thereby increasing trust
among members.
• The auditable Blockchains improved
circle of trust among stakeholders as
responsibility can be fixed and issues
resolved in case of discrepancies
Visibility The Paper-based Bill of
Lading has minimum
The Electronic Bill of Lading does
increase the visibility of data
across the stakeholders in
• The distributed ledger increases the
visibility of transaction for each
stakeholder in real-time as any

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visibility which are send by
courier.
Unless the original Bill of
Lading documents is received
by importer the process does
not gets started.
Shipping Industry. The visibility
of data is increased due to quick
exchange of documents amongst
members in Shipping Industry.
However, the visibility of data
does not ensure reliability of
information which is shared
among stakeholders.
The visibility of data is based on
documents which are shared but is
not real-time information. Each
time a data has been altered it must
be physically intimated amongst
members who will make changes
in their EDI framework as
compared to API framework of
Blockchains where data is
accessed in real-time.
modification made to transaction are
available to all concerned having
potential to transform entire Supply
Chain ecosystem
• The real-time visibility of transaction
helps to speed up logistics process and
avoid bottle necks
• The visibility of Bill of Lading in real-
time helps to reduce delays caused due
to missing paperwork and other contacts
in Shipping Industry
Transparency Transparency these kinds of
issues can be solved
effectively up to an extent.
There is a direct cost named
E-BoL is able to create
transparencies among Supply
Chain member as the documents
are quickly transferred however
• Each member in Blockchain has
capability to directly validate an items
provenance and authenticity of
transaction allowing them to have

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“facilitation payment” which
is considered as the additional
payment for any kinds of
delay because of bribe. If
there is no proper trading
system, the regulatory
environment will be very
worst functioning and
unstable.
there is no fixed format. This
might impact the understanding of
document. The documents have to
be transferred to each concerned
member on receipt and they are
not readily available.
updated ledger copy in real-time to
monitor Supply Chain increasing
transparency of each transaction
Validity Although Paper-based Bill of
Lading is valid it must be
approved by banks before
payments are released by
importer to exporter.
The validation lies with banks
based on trust. There are
however chances of fraud, by
third parties who has copy of
Bill of Lading.
Original Electronic documentation
exchange should be facilitating by
the solution. Consequently, to the
Cloud-based platform the parties
have access. E-signatures are
required to present and transfer the
reports Electronically. E-marks are
required to present and exchange
the documents Electronically.
• Once a shipment is confirmed and
recorded it is immutable i.e. its validity
of transaction cannot be disputed or
fraudulently manipulated
Reliability The Paper-based Bill of
Lading is reliable only to the
extent that it is send by
One of the major issues the
Shipping Industry point out is the
replication of a paper bill and
• The data can be stored in Blockchains
only by stakeholders who have
permission to access Blockchain to

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exporter to importer through
couriers. The access to Bill of
Lading is with multiple parties
who might tamper with
documents affecting reliability
and creating conflicts.
related document which is being
managed by the rules of approval
and completion. There is always a
bad mark for the Electronic data
exchange which is identified as
risky and not accurate which can
be duplicated or modified easily.
areas of their concerns. This ensure the
reliability of data on Bill of Lading and
other contracts of Blockchain
Time Saving /
Efficiency / Speed
Manual Record keeping, and
bill generation has many
disadvantageous like the risk
of misbehaviour and time
delay during the cross
checking of bills by the parties
to parties.
One of the main reason for
delay in delivery is the lack of
corporation between the
customs agency and the
companies which has no
proper trading standards.
Another issue might arise of anti-
competition actions, in case of a
union amid these 2 frameworks.
One more concern is that in spite
of the success of BoLero to
provide a no paper condition for
trade records, still there is the issue
to provide the sentiment related to
the comfort of paper. Still the
consideration of the substantial
quality of paper is in power.
Before issuing L/C the Banks still
demand for showing the paper
BOL, in the trade financing field.
The Banks’ insist on the paper
• The exporter and importer do not need
to maintain separate ledger as they are
working on the same Blockchain ledger,
and neither can alter it other than adding
new transaction which can be accessed
by anyone related to it at any time
where there will see updated
information saving time and hassles for
both as each party will not have to wait
for their internal databases to be
updated to proceed with transaction as it
is happening simultaneously
• Due to Blockchain customs and port
authorities can received documents
related to products well in advance thus

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BOL is approved alongside the
transporter who might likewise
require from the bearer the
issuance of paper BOL. Thus, the
whole purpose of Electronic Bill
of Lading is defeated in removing
inefficiencies related to Bill of
Lading. E BL does not replace
Paper-based Bill of Lading.
allowing them to clear documents as
soon as the ship arrives avoiding delays
and savings lots of costs
• Due to lesser middlemen in process
means lesser people involved and hence
saves time
• The smart contracts are self-executing
that are fulfilled when conditions are
met helping to increase efficiency of
transition by elimination of middlemen
Cost Collections of documents are
transferred during the
shipment process like bills of
lading which contains the
information about the goods.
In the next step the goods are
unload by the agents which is
again a complex and risky
task. Shipping process get
delayed because of this
inconsistent delivery methods
and the goods are being
The costs of Electronic Bill of
Lading are lesser due to quick
sharing of Electronic documents
but this does not minimise the
need of trust among members. The
members such as financial
institutions are still required which
increases costs.
Thus, it is better than Paper-based
Bill of Lading in improving
efficiencies in Supply Chain due to
quick sharing of information
• The Blockchain works as peer to peer
network of computers with distributed
time stamp service enabling sharing of
information between disparate parties
reducing needs for separate
administration as each member is
administrator and hence reduced costs
• Smart contract eliminates needs of trust
which was earlier required in Paper-
based and Electronic Bill of Lading as
payments are realised when conditions
of contract are met and approved by

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dumped in the garages for
longer period. This adversely
effects on the quality of
shipping process and thereby
makes problems in the
stakeholder which increases
the complexity of Supply
Chain management. Failure in
retrieving reliable information
on time, the invisibility of
goods delivery management,
emergence of major shipping
bottlenecks, work process
improvement in the inventory
management system or loss in
sub optimal levels are the
major factors which extend
the transit time of the goods.
There is no proper
digitalization of papers which
leads to delay in transport of
goods in the shipment domain.
reduces changes of lost papers,
quick disbursement of documents
to stakeholders etc. but costs
related to intermediaries remain.
The letter of credit still needed to
be approved by banks there by
increasing costs, which are
eliminated in Blockchain due to
the use of Smart contracts.
concerned parties eliminating costs
going to banks for bank guarantees, and
process
• The distributed ledge amongst the
stakeholders only eliminates the need of
middle man and thus Costs savings
possible, due removal of middlemen,
such as Clearing house agents, and third
parties etc.
• Cost savings as there are lesser chances
or delay from customs due in clearing
goods
• Cost savings due to lesser amount of
paper work
• Cost savings due to shared distributed
ledger

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The customs begin process
only after receiving original
Bill of Lading which may lead
to detention and demurrage
charges to shippers until
goods are cleared by
customers.
Confidentiality Information leakage is the
major issues problem
associated with the
information processing in
Supply Chain partners. The
confidentiality of information
should be properly evaluated
and most of the companies
need to make assurance in the
information exchange among
Supply Chain partners is
highly confidential. This trust
in the confidentiality of
information increases the
bonding between the partners
The confidentiality of information
is likely to be leaked as there are
many parties involved which is
minimised by Blockchain.
Neutrality – because of the
involved parties’ heterogeneity
like customs, terminal operators,
cargo forwarders, manufacturers,
banks, etc. advanced level of
neutrality needs to be ensured by
the service provider to shun any
irreconcilable circumstances
among the parties involved.
• The permissioned Blockchain allows
each stakeholder to view data only of
their concerns. Thus, the port authorities
will be able to view data in Bill of
Lading about products content and other
sensitive contract information related to
pricing, etc. are not available which
were easily stolen and made available to
competitors and other in Paper-based
and Electronic Bill of Lading. Thus,
maintaining confidentiality of data
• Even the involvement of only the
stakeholders in Blockchain and
removing the vast number of
middlemen prevents theft of both data

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in Supply Chain integration
process.
and products in the process improving
confidentiality of data
Security / Hacking /
Privacy
Administration efficiency of
customs is another major
bottleneck in the Supply
Chain. The service range and
quality of goods are calculated
from the national customs
authority is depends on the
clearance easiness of import
and export and the delivery
speed. If the resource
allocation is not efficient and
not sufficient and not properly
adopting best practices in the
customs procedures, it leads to
time delay for approval and
forced to face different kinds
of frequent inspections. It is
very difficult for the
companies with low
The Electronic Bill of Lading is
better than paper Bill of Lading as
documents lie within the
stakeholders involved in
transaction.
The Electronic Bill of Lading is
also capable of tampering same as
Paper-based Bill of Lading. The
documents which are transferred
to third parties are capable of
being meddled with.
The security of Electronic Bill of
Lading infrastructure is more
prone to hacking and not as
secured as Blockchains.
• Blockchains ability to create
decentralised and immutable ledgers
networks maintained by multiple
stakeholders whose information cannot
be hacked due to cryptographically
secured nature of operations
• The hackers unlike in past cannot break
into all computers connected to launch a
cyber attack

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investment in developing
countries to clear the customs
procedures.
Auditability The Paper-based Bill of
Lading involves lots of
documents and paper work
which must physically store in
files. There is lots of chances
of these documents and files
being lost making it very
difficult to audit.
The stores of Paper-based bills
of lading are also difficult and
hence auditability and changes
made during the process if not
stored and marked correctly
can be very difficult to audit
impacting the efficiencies of
Shipping Industry.
The documents are not stored
in any format and hence cross
The storage of Electronic Bill of
Lading is much easier as compared
to Paper-based Bill of Lading.
The documents in digital form are
do not provide trial of changes
made in the documents making it
difficult to find modifications
made in Bill of Lading. It is
difficult to determine the
provenance and authenticity of
legal documents in Electronic Bill
of Lading as they are capable of
being altered even after the
transaction causing inefficiencies
in Supply Chain in Shipping
Industry.
• Blockchain technology as a peer to peer
distributed network is used to validate
transactions and other records creating
immutable record having implications
on provenance and authenticity of legal
record improving auditability as it
directly points towards the original
source which entered or altered data on
Bill of Lading fixing responsibility and
helping in times of dispute resolutions
• Blockchain Bill of Lading and other
contracts not only provide information
on products origin but also about
product handling, transportation, storage
etc. providing traceability of the causes
and responsibilities for the problems
that occurred in the process
• The Blockchains are immutable ledgers
means that all the data are permanently

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checking will become difficult
and expensive.
The physical documents can
easily be altered after
transaction.
recorded pointing towards the
stakeholder’s role in data input involved
in a transaction
Figure 16 Blockchain based Smart BoL
Source: (CargoX,2018)

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Figure 17 Letter of Credit Before Blockchain implementation
Buyer/Applicant
Bank A
Seller
Bank B
Purchase Agreement
Shipment of Goods
$$$
Docs
LOC
RequestLOC
$$$
Docs
LOC
Docs$$$

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Figure 18 Letter of Credit After Blockchain implementation
Seller
Purchase Agreement
Shipment of Goods
Blockchain
Buyer/Applicant
1. LC Request w/ docs
7. If discrepancy/ Review
Approve/ Reject
2. Approves LC
6. Reviews Docs/ Invoice
Marks Completed
4. Completes shipment,
invoice and required docs to
Blockchain
3. Approves LC
5. Approves Invoice/ Docs
Bank A Bank B

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Figure 19 Customs process before Blockchain implementation
Source: (IBM Blockchain, 2017b)
Figure 20 Customs process after Blockchain implementation
Source: (IBM Blockchain, 2017b

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7 Research Findings and Conclusion
7.1 Research Findings
It can be seen the Blockchain technologies offer lots of scopes to improve efficiencies
as compared to the Paper-based and Electronic Bill of Lading in the Shipping
Industry. The distributed ledger systems minimize the needs of trust for stakeholders
in Shipping Industry such as brokers, clearinghouse agents, bank and financial
institutions, etc. Which helps in reducing costs related to such in the form of letters of
credit, bank guarantees, etc. The issues related to privacy and confidentiality of data
are also solved with the help of permissioned Blockchains as only those members
who have permission will be able to access data. The stakeholders such as customs,
logistics, agents, etc. will be able to view information only of their concern and hence
sensitive information such as costs, pricing, etc. are not visible and protected. The
issue related to security of data is also addressed by permissioned Blockchains and
encryption of data by users. However immutable and public permissioned
Blockchains of IBM seems as compared to editable Blockchains of Accenture.
Because data once entered cannot be deleted or modified on added. The immutability
of Blockchain and provenance improve the audibility of data. That helps in resolving
of disputes by fixing responsibility related to shipping of documents.
Blockchain does improve the visibility of goods in the process from exporter to
importer and helps to improve efficiencies to all members such as shipping liners who
can know the current status of demand, on ship adjust pricing accordingly, etc. The
visibility of goods can help importer to arrange for customs clearance and logistics as
soon as products reach docks minimizing wastage of time in receiving documents as
they are readily available. The Electronic Bill of Lading and digitization of other
papers helps port authorities to clear goods on time as they have all information about
products and other items on their systems. This also minimizes the chances delays
caused due to lost documents. The use of smart contracts in Blockchains facilitates
quick payment to the exporter as soon as the conditions of agreements are met. This
use of original deal minimizes needs of costs involved for banks and financial
institutions for issuing a letter of credits, bank guarantees, etc. Thus, there is a

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significant reduction in time and expenses for both exporter and importer in Shipping
Industry increasing the efficiency of the Supply Chain.
The governance of public Blockchain allows the inclusion of more members to
Blockchain based on consensus. The democratization of free Blockchains enables
flexibility of members to add to the Blockchain. However, there are fears of
monopoly being created by dominant members which might form groups which can
impact the scalability, democratization of Blockchain. The success of Blockchain in
Shipping Industry will depend upon its acceptance by the broader number of
stakeholder in the Shipping Industry. The main obstacle will be the adoption of
Blockchain by Port and customers authorities of various governments and laws
governing those countries.
All through the lifespan of a BoL, it should be a particular document. In an Electronic
situation, it was being considered, until recent years that just by methods of a vital
registry regulated by a trustworthy entity the assurance of exceptionality was feasible.
Presently, the reliability of exceptionality could be provided by the Blockchain
technology that was created to shun twofold spending. As compared to the E-BoL the
Blockchain based BoL have additional benefits. Therefore, unlike the current models,
there won’t be any requirement of earlier membership to participation for an open
Blockchain platform. As for the spread E-BoL, the condition of a group used to be a
significant obstruction; this will be an essential benefit. The decentralization
facilitated by Blockchain technology also provides other benefits
There are three main risks in paper-Bill of Lading such as risks related to the delivery
of goods, risks or increased costs due to delay in in documents and fraud which is due
to loss of records by accident or intention.
BoLero and SWIFT are two leading companies in Electronic based Bill of Lading.
Minimizing operational risk and following the rule and regulations of the strict
regulatory framework are the two significant challenges. There is a need for proper
supervision and improved efficiency for facing these challenges. SWIFT application
enables corporate for using reliable and secure communication platform provided by
their financial institutions like cash flow management or trading services. Cloud-
based, end to end and secure services are being delivered by BoLero which digitizes
the transactions and trade procedures, giving more control power, transparency and
visibility and thus makes the trading faster, smarter and safer.

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Electronic Bill of Lading is better than a Paper-based Bill of Lading by offering better
letter of credit experience. Improving working capital requirements, Improving
Supply Chain by Digitizing the receivable and payable procedure, enhances
documentary collections for favourable transfer of goods in trade settlement,
guarantees payments Electronically, enhance integrity and security of the transaction.
However, there are issues related to the number of participating companies; there are
parallel systems of trade settlement like BoLero, matters related to anti-competition,
there are still issues related to the quality of paperwork. Electronic Bill of Lading
does not remove Paper-based Bill of Lading which is still required to be produced;
there are many legal frameworks to support Electronic Bill of Lading.
Blockchain Bill of Lading solves many issues related to Paper-based Bill of Lading as
well as E-BoL by providing various benefits compared to existing systems such as the
use of cryptokoens on assets making tracking easy providing necessary visibility and
transparency. Digitalization of documents improve faster processing of transaction
reducing delays and costs caused by Paper-based trading, and information
immutability reduces the scope of fraud and security of data. Blockchain smart
contracts can solve the challenges in trade finances.

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7.2 Research Conclusion
Cryptographic security, Distributed ledger architecture and Network consensus
mechanism are the three major critical features of Blockchain technology which
significantly treating significant hazards of trade finance sector. Cryptographic
Security - It is one of the notable features of Blockchain technology for assuring
reliability and immutability of data. By using this feature, the transaction records
stored in the Blockchain network in a secure manner which can be verified by all the
participants at any time. Cryptographic security assures high confidentiality in
transaction record by applying permissioned access feature for trade participants. So,
the information is very secure and easily accessible in the Blockchain network
Traceability, and Transparency is ensured in the Blockchain network by applying
distributed ledger architecture. Thereby the visibility and easiness to access the
information increase for merchandise tracking. Contractual obligations executed
automatically through smart contract using distributed ledger architecture.
Eventually, this reduces the risk of downtime hazards and manipulation risk of
transaction records. Network Consensus Mechanism prevents problems linked with
double spending and provides a native allotment of financial assets like payment
agreement and trade receivables. Network Consensus mechanism strengthens the
relationship between trading and financial parties for exchanging the digital assets.
All these three key features provide a stable base for developing a robust and reliable
trade finance system and thereby ensures transparency in trade Supply Chain.
The Present Container Shipping Industry has much paperwork such as Bill of Lading
involved which leads to the delay in the process and cost much money. Electronic
Bill of Lading offered by Bolero and other companies in the field help us with the
reduction in the paperwork by digitalizing it and reducing the errors. However, the
main issue which revolves here is the security and transparent aspect. Electronic Bill
of Lading can also be edited and manipulated like the Paper-based Bill of lading
hence it is still considered to be insecure. In the current scenario due to
advancements in the technology, there is a solution for this issue provided by
IBM.IBM Blockchain based Bill of Landing based on a distributed Hyperledger

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which helps in promoting Transparency, Security, Traceability, etc. in case of Bill of
Lading.Significant challenges facing freight and logistics industry in the current
scenario are lack of transparency or visibility, security issues and lack of efficiency.
Blockchain technology has a significant impact on the future of freighting and
logistics industry. By creating immutable and decentralized ledgers in a peer-to-peer
network which has a risk of failure even in a single point is the main recommended
feature of Blockchain technology. The primary advantage of this feature is that the
information shared in the Blockchain is highly secured and multiple participants can
access it. Shared data cannot be hacked or modified by anyone. Transparency and
security are the two essential milestones of the lifecycle of transactions within the
Blockchain network.
Freight and logistics sector is very complicated and lots of transactions involved in
the work process transactions. There are lots of confidential information needs to
transfer across the complex Supply Chain network which is not accessible by any
other levels in the specified chain. Current work process scenario of freight industry
is very complicated, and the brokers manage the significant part. Freight brokers
initiate the transaction of carrying the loads from the shippers to the carriers. The
work process includes checking the goods, tagging the products with proper mark-
up, sell the products to the airlines. This intermediary process increases both cost
price to the carriers and downstream price which directly affect the consumers
.
Blockchain technology efficiently resolves these three problems with the highly
secured peer-to-peer network. Through Blockchain network, the customers can freely
participate in a more transparent and secured trading system globally thereby reduce
the unwanted intermediary and other kinds of brokerage costs. By using Blockchain
technology in the Shipment sector, there will be a potential increment in the work
process efficiency and transparency among carriers, shipping dealers, consumers,
Supply Chain stakeholders, etc. Ethereum Blockchain is the most advanced
Blockchain technology which is very useful in the shipping sector which influences
the Smart Contracts which significant executes the contracts by self which finish
when the predefined regulations are acquired. This methodology significantly
improves the quality of work process of shipping sector by limiting the intermediary
actions and bypassing the mark-up. When the shipment recorded in the Blockchain

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network, it is immutable. No participants in the Blockchain network can argue on the
particular shipment transaction, and nobody can modify the operation. When the
sales logged in the system payments can release by the smart contracts immediately
which reduces the intermediary processing costs. Future enhancement of a
decentralized brokerage system will help the shipping and freight sectors to work in
an open marketplace
Transparency and Information Flow of the Supply Chain work process efficiency can
increase by using Blockchain technology. Whole shipment lifecycle can be easily
viewed in the Blockchain network and get valuable information like geo-waypoints,
load shipment details, etc. Because of the transparency of operations, the shipment
dealers can optimize the cost in each shipment. Details about goods capacity,
delivery cost and time are easily accessible from the Blockchain network. By using
the provided information regarding the shipment cost and other charges, the carriers
can take decisions on pricing the goods dynamically. This transparency in
transactions helps the participants to allocate the resources efficiently without
depending on the brokers. Blockchain also prevents hacking and theft issues by
providing high visibility in sales. Transactions recorded in the Blockchain as logs
which are immutable to the hackers thereby the information is highly secured, and no
one modifies any crucial information.
Blockchain technology can make a significant impact on shipping sector even if in
the present scenario most of the shipping firms have their container tracking , but the
Blockchain network is more flexible and secure than any other means of tracking.
World’s largest shipping company Maersk Line already tied up with IBM to
implement Blockchain for total digitalization of the shipping line which includes
tracking cargo containers, reduction in the paperwork due to Bill of Lading,
Transparency in all the processes along the Supply Chain.
IBM has done full-fledged implementation of the Blockchain technology at
Singaporean Ports after early stage trials of Blockchain Technology for transnational
container shipments..

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7.3 Research Recommendations
For the technologist and architects, the working group of hyper-ledgers serves as a
cross forum to explore and exchange ideas other trade-offs and architectural choices
from the Hyperledger community. For the distributed ledgers of business class to
develop a modular structural system is their primary focus. The requirements of
business Blockchain differ. Before being linked to the chain, short block affirmation
times and fast system consensus frameworks needed by specific uses. For other
purposes, they might accept a slower preparing time in return for a lower degree of
necessary trust. Across industries and uses the security requirements, work-flow
complexity, compliance, confidentiality and even scalability vary significantly. For
the technology, a potentially particular optimization point represented by all these
requirements along with several others. With the use of the modular architectural
system, re-utilization of regular building blocks is being encouraged by the umbrella
strategy of Hyperledger and empowers rapid advancement of standard useful
modules, the interfaces amongst them and the distributed-ledger-technology. This
modular system’s advantages are adaptability, extensibility and independently
modifying any component with not influencing whatever remains of the framework.
A modular method which empowers flexibility and extensibility followed by the
authorized Blockchain systems by the larger hyper-design plan Philosophy.
From the above findings and conclusion, it can derive that the IBM Blockchains are
more suited to Shipping Industry due to its permanent features. The critical
stakeholder will find IBM’s immutable Blockchain with public permissioned more
suitable as compared Accenture’s editable Blockchain which seems to be more fit for
finance and banking industry as compared to the Shipping Industry. When comparing
Paper-based Bill of Lading and Electronic Bill of Lading with IBM, we can see that
IBM offers much more security, privacy, confidentiality of information, and auditing
in real-time which is much needed to remove inefficiencies in Supply Chain eco-
system of the Shipping Industry. Hence IBM Blockchains are more suitable for
adoptions for critical stakeholders in Shipping Industry such as vendors, Shipping
liners, logistics providers, etc.
The Electronic bill and digitalization must be able to meet all the expectations of its
hardcopy which includes an offer, negotiation, counteroffer, acceptance and then
giving the parties their due rights. It must also include elements of trade between

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small parties that are not part of the Blockchain but play a significant role in the
delivery of goods. It must even manage the regulators, bank, credit houses, etc. by
keeping them updated on the status of contract and container. This shall motivate
people to shift from paper to digitalization. This digitalization model should be such
that it can be incorporated into any system and module with minor changes and must
be adjustable for all to use. The formats and the carrier network must make sure that
the same document is available at all place across systems and take care of all
regulatory and financial restrictions.
IBM Blockchain must collaborate with companies such as BoLero and SWIFT to find
out how they can work together and form a synergy to remove issue related in an
Electronic Bill of Lading and to build a more comprehensive system.And partnering
with various stakeholders such as shipping companies, government, etc. to make
Blockchain more comprehensive and complete.
Blockchain companies will have to work with governments and port authorities to
form a worldwide standard of accepting the document, verification, duty, etc. to let
automated clearing of goods for the speedy process of clearing Electronic Bill of
Lading in Blockchains. The legal framework must also be framed with governments
of various countries to resolve issues arising related to fraud, privacy, security, non-
payment appearing in the Blockchain. Unless the legal framework and systems
widely accepted across the world, it is highly unlikely Blockchain will succeed in
near future. These are primary obstacles to be tackled.
For small-scale logistic companies with Paper-based BoL, E-BoL is advised as it is
Open sourced or cheaper as compared to IBM or Accenture Blockchain
implementations which require high capital investment.

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8 Limitations and Area of further Research
By subsequent data investigation, the comparative Case Study could be based entirely
on, along with there is no need of collecting any primary data or fieldwork. However,
for this to be a suitable choice, the existing evidence’s quality should be reasonably
stable. Further research can be done by collecting data from all the responsible parties
by taking a few sample cases and tracking their entire Supply Chain (Jorgen et al.,
2017). This would help to get a complete picture of the working of the Blockchain,
general issues and costs savings, etc. related to Blockchain.
The researcher has focused only two Blockchains, IBM Hyperledger of the open
source Blockchain technologies and Accenture but their other Blockchains. Both
open source and private commercial Blockchains (Hyperledger , 2016). Further
research can be done by examining a comparison between open source and closed
retail Blockchains. In specific contexts, there are disadvantages of comparative case
studies. One of the chief concerns is that usually they are exceedingly resource
concentrated, especially when full fieldwork is needed. By a specific study’s purpose,
it might be smarter to reasonably choose fewer cases or grouped cases of a particular
kind only if the examination spending plans forbids additionally detailed survey of
more quantity of cases. The companies operating in Blockchain specifically to
Shipping Industry could be grouped to get a more precise picture of which companies
are better. Thus, future researchers can be along these lines.
The current Blockchains compare Paper-based bill lading, with an Electronic Bill of
Lading and use of Blockchains with the help of secondary research data and not a
single time any stakeholders are directly participating in research. All the issues are
arising, and problems known are from secondary data, and hence three is no first-
hand experience, and this can be considered as limitations. The first-hand experience
of a sample with each case of a Bill of Lading and Blockchain could help to
understand issues on the ground hence further research can be primary on the field to
find the problems on the ground and how to resolve them. The government position
on adoption of Blockchain is also essential to understand.

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9 Glossary of Terms
• Block-Data: Collection of messages of activities
• Chaining-Hash: A replica of hash value which is soon preceding the block
• Block-Hash: the sum of block-data hash value and chaining-hash value
• Crypto-currency: A subset of virtual currencies: they don’t have any physical
representation and use encryption to secure the procedures complicated in conducting
transactions.
• Distributed ledger: A database in which quantities of the database are saved in more
than one physical places, and processing is, sent amongst a couple of database nodes:
Blockchain systems are called distributed ledgers.
• Hash/hashing: The transformation of a string of characters into a commonly shorter,
constant-length value or key that represents the authentication (similar the creation of
a bitcoin link).
• Bitcoin: A digital currency that is not sponsored by means of any USA significant
bank or government: traded for items or services with carries that to be given bitcoins
as a Smart contract: A computer program that at once controls the switch of digital
currencies or assets between parties under conditions: saved on Blockchain
technology.
• Remittance: A amount of money sent, specially through mail or digital transfer, in
payment for items or services or as a present.
• Ethereum: A public Blockchain entirely distributed used computing platform smart
lever agreement capability: facilitates executes peer-to-peer contracts the use of a
crypto-currency known as ether.
• Digital wallet: A software program utility, typically for a cell phone, that serves as an
Electronic model a physical wallet.
Bitcoin mining: That act of processing transactions within the digital foreign money
gadget: the information of modern-day bitcoin transactions- recognized as blocks-
are introduced to the report of beyond operations, referred to as the Blockchain

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