Historic day to remember
September 11 2024 just might go down as one of the most important days in the digital world, ever.
That was the day the Ministry of Justice introduced the Property (Digital Assets etc) Bill in the UK.
This has been some time in the consultation and drafting and, in my own modest way, I contributed to it as far as Scotland is concerned. You will be aware that Scottish Law is somewhat different to English Law. Indeed, a friend of mine, who had visions of working for megabucks in the city, had done two years of studying Scottish Law before someone told him he would be stuck in Scotland.
Why is this important? This bill formally recognises that digital assets (including crypto currencies and NFTs) are classified as personal property in England and Wales. You might say "So what?" but whether you know it or not, different classes of property have different characteristics in law, and therefore have to be treated differently.
Until now, digital assets were in a sort of limbo, not classified as property at all. Now with this clarity, scams and frauds will be easier to prosecute and judges have definitive guidelines in respect of something not tangible or the product of a human mind (like a book or a piece of music). A digital asset will henceforth be personal property, attaching to a person or entity, which, until now, it has not.
As you know I am a great proponent of regulation as far as the digital world goes. The more clarity and certainty there is, the more the man in the street (and the sharpshooting asset manager in his eyrie) will feel comfortable being involved with them. And that is a good thing, especially as the real world intrudes more and more into the digital world and vice versa. As I argued last week, we just may be seeing the start of proper adoption of digital assets as real world “things” – fantastic.
This also boosts the UK's standing as the “go-to place" for legal certainty (if there is such a thing). The work on the Bill, what it is and what it does began before 2023 when a Law Commission report was promulgated which explored ways to recognise digital assets as property under English and Welsh laws. A similar bill is in preparation in Scotland, which is the one I was involved with.
So quite possibly a watershed moment in the digital landscape. It certainly makes it easier for international companies to decide to use English Law in their machinations. True, there will need to be case law and judicial rulings before it is finally settled, but this is a massive step forward.
The legal industry in the UK accounts for some £34 billion of annual income to the UK, and this will add to that substantially.
UK Law 1 - Rest of the World 0.
