Chris Holmes, UK’s leading advocate for technology and innovation, and committee member on the groundbreaking Electronic Trade Documents Act that came into effect on 20 September, discussed the nexus of technology, legislation and regulation in the digital era
The Electronic Trade Documents Act ensures that electronic trade documents have the same status in law as the current paper version and is a seminal legislation that has global impact on cross-border trade. Holmes, its champion whose committee “scrutinised every comma and fullstop”, shared his observations in a wide-ranging conversation with Emmanuel Daniel on open banking, central bank digital currencies (CBDC), cryptocurrencies and labour market transition.
While the bill is set to be life-changing globally, it is not the most remarkable aspect of Holmes’ life. His achievements in the field of sports and academia began at the age of 14 when he lost his sight overnight. His personal experience of using technology such as basic inclusion software that converts text into speech on his laptop taught him about inclusion and what assistive technology meant.
He said: “I’ve always been very interested in technology and always benefited from it. All technology needs to have that positive purpose, otherwise, what’s the point of it?”
He went on to study at Cambridge University. He was a member of the Great Britain swimming team for 16 years and broke 35 world records. Holmes was a former director of the London 2012 Olympic Games and Paralympic Games. He was appointed a Member of the Order of the British Empire (MBE) in the 1993 New Year Honours for services to swimming for disabled people. In September 2013, Holmes was created a life peer, taking the title Baron Holmes of Richmond. He is an active member of the House of Lords with a policy focus on digital technology for the public good, social mobility, employment, education, skills, culture, media and sport.
The Electronic Trade Documents Act has revolutionised trade documents, reducing transfer times from days to minutes, enhancing efficiency, and curbing carbon emissions. Holmes commented: “The Electronic Trade Documents Bill has been a year of my life, but a really positive year of my life. It’s probably the first example, certainly in the UK and to a large extent around the world, where you’ve seen the coming together of how we legislate for these new technologies.”
He described how the UK’s Data Protection and Digital Information Bill is important in open banking and open finance legislation, and the significance of regulatory interventions like Competition and Markets Authority Order 9 that has fostered innovation and financial inclusion by allowing third-party access to bank accounts.
He added that the Financial Services and Markets Act 2023 provides clarity and certainty to businesses operating in the crypto space, saying: “It’s really fascinating what we’re doing at the moment with the London Stock Exchange in terms of the opportunities for London’s capital markets and the innovation that can go into those markets as a result of these new technologies.”
He shared his insights on how artificial intelligence (AI) and blockchain are reshaping the way people do business. He commented on the antitrust legislation in all jurisdictions that addresses the issue of dominant players like generative pre-trained transformers achieving a monopolistic position.
Holmes also mentioned the negative impact of cryptocurrency on the US banks, stating: “[It is a situation that] nobody would want to end up in, where it’s really regulation through enforcement—that’s not a happy position for regulators, states, businesses and individuals.”
He also touched on CBDC and stablecoins and the need to protect cash, saying: “It’s a really interesting time for fiat currency,” adding that policymakers have been trying to ensure that the transition to that digital future is accessible and inclusive.
Holmes believes that AI will cause significant changes in the labour market, but that with the right framework, these changes can be managed effectively. He describes himself as pro-innovation, pro-regulation and pro-legislation, who does what needs to be done, and emphasises the right levels of consumer protection: “I’m very comfortable with my role in the House of Lords as the second chamber, so we always ultimately give way to the primacy of the elected chamber, the House of Commons.”
He shed light on the critical role of regulators in balancing innovation with consumer protection. He lauded the Financial Conduct Authority and the Prudential Regulation Authority for being good regulators, saying that regulators must ensure they operate within their scope of competency and that their actions align with parliamentary intent.
Holmes, leading the charge in passing the bill wrote in his blog: “I have repeatedly described it as one of the most important laws you’ve never heard of because, although it is a small sounding law with a simple purpose—to permit electronic trade documents on the same legal basis as paper documents—it also holds such vast potential. Not just for international trade but for the development and adoption of distributed ledger technologies and significantly, positively, on our environment. Estimates from the World Economic Forum suggest moves to electronic trade documents could reduce carbon emissions from logistics by as much as 10-12 per cent.”
Holmes emphasised: “We need to ensure that not only the legislation and the regulation move at pace, but also that they are written, constructed, and passed in such a way that they have the flexibility, the adaptability, to be good for at least a reasonable period.”
Finally, he underscored the importance of interoperability and global collaboration in legislation, regulation and standards, viewing them as essential ingredients in ensuring that technological advancements benefit all, saying: “We need to absolutely make sure that by humanly leading on these technologies with a rational, optimistic approach, we make success for every individual, every citizen, every city, community and country in a globally, interconnected world.
“The more we can cooperate, connect and co-create, the more we will enable and empower economic and social benefit right away around the world.”