On 18 July 2018 the European Parliament Committee on Internal Trade (“CIT“) published a draft report setting out a motion for a European Parliament Resolution regarding how blockchain could be harnessed to enhance international trade and supply chain management. The report focuses on the use of permissioned (private) blockchain solutions.

Blockchain  Benefits  

The CIT believes that blockchain provides enormous opportunities for reducing barriers within global trade. In particular, the potential benefits of permissioned blockchain solutions include:

  • reducing the need for physical paperwork and therefore reducing the costs of supply chain management;
  • enabling small and medium-sized enterprises to interact more efficiently with customs authorities and third parties along their supply chain;
  • helping reduce the administrative burden placed upon suppliers from third countries seeking preferential treatment (i.e., reduced customs duties) when importing their goods into the EU under the terms of an EU Free Trade Agreement; and
  • increasing transparency in relation to the provenance of goods entering the EU.

Blockchain Challenges

The CIT notes the following challenges facing blockchain: potential compatibility issues with GDPR requirements (while acknowledging potential blockchain solutions for GDPR implementation); poor interoperability between blockchain and existing systems; and uncertainty in relation to the scalability of blockchain.

Recommendations for the European Commission

The CIT recommends that the European Commission takes certain action to encourage blockchain adoption. These include:

  • address regulatory hurdles to blockchain implementation;
  • follow blockchain developments, in particular ongoing supply chain pilot projects;
  • produce a strategy document regarding the adoption of blockchain to improve supply chain management;
  • develop guidelines for industry to increase certainty to encourage the use of blockchain;
  • work with Member States to improve information exchange in supply chains;
  • set up a blockchain advisory group and develop a “concept note” for permissioned pilot projects on blockchain in the supply chain;
  • assess blockchain architecture that keeps private data off chain;
  • develop a framework for addressing interoperability challenges;
  • work with industry to develop blockchain standards; and
  • provide input on current international standards projects.


Kevin Monaghan, Sue McLean, London

Tags: #blockchain #europe #GDPR #privacy #supply chain


Sue McLean is a partner in the IT/Commercial Practice Group in Baker McKenzie's London office. Sue advises clients on technology, sourcing and digital media business models and deals, as well as the legal issues relating to the implementation of new technologies. Sue advises clients (both customers and suppliers) on a wide range of technology matters including outsourcing, digital transformation, technology procurement, development and licensing, m/e-commerce, cloud computing, AI, FinTech, blockchain/DLT, social media, data privacy and cybersecurity. Sue also advises on commercial agreements and the commercial, technology and intellectual property aspects of M&A transactions and joint ventures. Sue has experience across various business sectors, including the financial services, consumer, TMT, travel and life sciences industries. She regularly speaks and writes about the impact of disruptive technologies and has a regular blog for Computerworld.