The U.K Law Reform Commission’s annual report has signified the British legal body would begin research into smart contracts. It’s also looked to highlight the importance of smart contracts and blockchain. Also the importance of the U.K responding to these emerging technologies effectively, lest it loses pace and becomes uncompetitive in a rapidly globalizing world.
The report is exceptional for its advocacy of a future U.K. legal system that clear-cut yet flexible. Usually advocating for something clear but flexible is unexceptionable in business or bureaucracy, but law is rarely famous for its speed.
Speed and Security
Usually, when it comes to law reform in a nation like the U.K, changes are slow, laborious, and minute. This is often to the frustration of those who would desire a more rapid change, but historically it’s helped guard against the risk major changes would be made owing to a trend or passing theory, instead of a solid platform.
Yet, by the report declaring “there is a compelling case for a Law Commission scoping study to review the current English legal framework as it applies to smart contracts”, the Commission has not only kicked off a new research period but will also drive public debate. One that will be followed with interest not only in the UK but also in nations that trace their legal heritage to it.
Britain and the European Union
Yet, for all the dialogue about future change, it’s clear the U.K is right now in an immense time of change. The elephant in the room in this debate is the Brexit issue. From a legal perspective, the U.K.’s exit from the European Union in this fashion is unprecedented.
It is also intensely complicated, as the UK’s May government has already signified they would effectively seek to extend the original departure date of the UK from March 2019 to the end of 2020. In and of itself, Brexit (most likely) won’t have any lingering impact on the UK’s ability to make laws and grow industry surrounding smart contracts.
But the impact of Brexit on the UK’s reputation as a leading tech epicenter could be immense. Especially because so many businesses historically chose the UK as a domicile because of its access to the EU.
Tech firms won’t disappear in London, Manchester or Liverpool overnight, but post-Brexit many may shift to Dublin, Paris, or Berlin so they can retain easy and unrestricted access to the European Single Market. Something that at time of writing it’s unclear U.K. businesses will posess, if indeed – as UK Prime Minister Theresa May famously declared – ‘Brexit means Brexit.’
Capacity and Customers
Alongside sheer capability, technology must have sufficient demand in the market in order to be a real success. This nexus of these two factors is something the future of U.K will have to wrestle with, conscious that anything other than a ‘stay’ (or perhaps ‘soft Brexit’) could have a substantial and enduring impact on the desirability of the U.K as a global epicenter for smart contracts.
For now, observers will watch with interest the progress of the Commission’s research on smart contracts, just as they wait for London to ink their own contract on Brexit.