Japanese shipping firm Mitsui OSK Lines (MOL) and partners including IBM are to undertake a blockchain proof-of-concept looking to streamline international trade flows.
According to the company's statement, the "demonstration test" will see real-time trade transactions made using a blockchain-based application. The project will see trade agreements, logistics and insurance documents, and more, digitized, stored and shared among participants, bringing a number of benefits over traditional trade systems.
"The test is intended to verify the effectiveness of blockchain for enhancing security and reducing the time required to settle cross-border trade transactions, discrepancies among related documents and administrative costs."
Aiming to increase competitiveness and develop new products via the technology, joining MOL on the project are IBM Japan, the Japan Research Institute, Sumitomo Mitsui Financial Group (SMFG), Sumitomo Mitsui Banking Corporation and other arms of the Mitsui Group.
The proof-of-concept will utilize the Hyperledger Fabric blockchain framework, developed by the Linux Foundation-led Hyperledger blockchain consortium.
SMFG was recently revealed to be among a group of Japanese financial institutions that successfully tested a prototype using distributed ledger technology (DLT) to streamline international transaction agreements. That work used DLT startup consortium R3's Corda software to streamline an ISDA Master Agreement negotiation.
In September, a joint venture between shipping giant Maersk, Microsoft and accounting firm EY was announced, having the aim of applying blockchain technology in the field of marine insurance. Built using Microsoft Azure, the effort will to create a shared database that logs information about shipments, as well as potential risks, in order to help companies comply with insurance regulations.
Container ship image via Shutterstock