An electronic chain has its own in-built security
insofar as it guarantees that what is transmitted is the original. Changes,
additions, deletions and any mismatches, including the identity of who submitted
them and when, are noted, recorded and advised. This removes a major cause for
loss and argument in the coffee trade: incorrect documentation and who is to
blame for it. An electronic system guarantees that the documents are correct as
received but of course cannot by itself say anything about the coffee these
cover, so the importance of collateral management remains unchanged.
The system would record exactly what was done, by
whom and when, for each individual contract by means of a unique identifier
which also tracks the progress of each individual document. An identifier is
generated whenever a new transaction is initiated. This can be done by the buyer
or the seller, depending on what was agreed between them.
In its simplest form all this means, for example,
that a buyer who erred in the description of the goods in a letter of credit, or
who instructed the wrong shipping marks, cannot later claim it was the shipper's
fault and withhold payment.