new technologies. As well, few courts have had the opportunity to rule on the validity of electronic documents, messages or signatures.
From early in the use of EDT, these types of legally focused agreements have been employed by businesses in different industries, in different economic or geographic regions and for different levels of technology sophistication.
Why should a company use an interchange agreement?
In the absence of clear governing legal rules and principles, an interchange agreement provides a company with a readily available solution for formalising the EDT relationship between it and its trading partners.
For example, the Model Agreement, when properly relied upon, seeks to provide EDT messages with a legal binding effect across different national legal systems. This goal is pursued by addressing all of the basic legal issues needing to be covered before a company uses EDT to communicate with its national or international trading partners. Thus, once a company decides it will use EDT, it will require agreement with its trading partners on at least the following issues, the priorities of which will vary based upon the specific needs of that company:
a)selection of EDT messages, message standards and methods of communication;
b)responsibilities for ensuring that the equipment, software and services are operated and maintained effectively;
c)procedures for making any systems changes which may impair the ability of the trading partners to communicate;
d)security procedures and services;
e)the points at which EDT messages have legal effect;
f)the roles and contracts of any third party service providers;
g)procedures for dealing with technical errors;
h)the needs (if any) for confidentiality;
i)liabilities in the event of any delay or failure to meet agreed EDT communications requirements;
j) the laws governing the interchange of EDT messages and the arrangements of the parties; and
k) methods for resolving any possible disputes.
Interchange agreements between trading partners are an entirely voluntary arrangement. However, as the fairly extensive list above indicates, a company will need to consider a number of very important issues before starting to use EDT to communicate with trading partners. An interchange agreement gives a structured framework for considering and formalising these basic issues.
The failure to gain a reliable and binding agreement on the rules governing abusiness' EDT communications presents the risk for unnecessary and costly disputes among trading partners, and, in the worst case, may result in litigation.
What model Interchange agreements exist?
A number of model interchange agreements have been developed for both national and regional use. These include interchange agreements published by national EDT organisations, professional bar associations and public administrations. However, at the time of this publication, no global model exists other than the Model Interchange Agreement.
In the absence of an existing model for international commercial trade transactions, conflicts among the existing national or regional models were also believed to inhibit the deployment of EDT in international trade. The various models consulted by the Legal Rapporteur Team varied widely in length, substance and content; the Model Interchange Agreement seeks to reconcile and find common ground in order to enhance the ease of international trade use of EDT.
How does this Model Interchange Agreement differ from other model agreements?
This Model Interchange Agreement is particularly suit able for international trade. It has been developed taking into account the differing national legal systems and offers practical solutions for overcoming any difficulties these might cause. It is intended td be sufficiently flexible to meet the requirements of all of the business sectors involved in international trade. Users may also find it useful for preparing interchange agreements relating to purely national or regional EDT commercial activity.
If a company decides to use the international model set out in this Model Interchange Agreement as a basis for deciding the rules governing the use of EDT between it and its trading partners, one can be reasonably confident that a tool has been selected which:
-addresses the recognized legal issues arising from the commercial use of EDT in international trade;
-provides a strong legal and practical framework for considering and recording the necessary business decisions.
MODEL INTERCHANGE AGREEMENT FOR THE INTERNATIONAL
COMMERCIAL USE OF ELECTRONIC DATA INTERCHANGE
This Model Interchange Agreement publication consists of three parts:
The Model Interchange Agreement.
The Commentary, which provides certain explanations and additional guidance.
