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add initial content for ICL spec #2

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add initial version of background survey
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15 changes: 13 additions & 2 deletions README.md
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# icl
Inter customs ledger
# edi3 Inter Customs Ledger Specification

* [Version 0.1.0](/docs/0.1.0/index.md)
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Specification: [Inter Customs Ledger 0.1.0](http://edi3.org/specs/edi3-icl/0.1.0/)

Community discussion/support: [edi3.org](http://edi3.org)

Open source reference implementation:

Test suite:

Live test endpoint:
128 changes: 110 additions & 18 deletions docs/index.md
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---
title: "edi3 Inter Customs Ledger 1.0 Specification"
title: "edi3 Inter Customs Ledger 0.1.0 Specification"
specID: "icl/1"
status: "![raw](http://rfc.unprotocols.org/spec:2/COSS/raw.svg)"
editors: "[Chris Gough](https://github.com/monkeypants)"
editors: "[Richard Spellman](https://github.com/arpentnoir)"
contributors:
---

## Abstract
This document proposes the use of a permissioned Inter Customs Ledger to facilitate the transfer of regulatory documents between customs agencies.

## Status

This document is currently focussed toward providing enough background content to inform discussions on elaborating the design of an Inter Customs Ledger.


## Glossary

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Phrase | Definition
------------ | -------------
| Authorised Body| In this document, the term Authorised Body is used to denote an organisation which has authority to issue some Document. e.g. A Chamber of Commerce which issues Certificate of Origin under some FTA, a CITES Management Authority which issues CITES Permits, etc.|
| Document | When capitalised in this document, this term refers to any document which gives authorisation for an importer or exporter to take some action (or be granted some further authority) with respect to an international shipment of goods. e.g. a Certificate of Origin, a Phytosanitary Certificate, an Export Declaration, etc|
| Node | A device on the Inter Customs Ledger network which has full visibility of the entire ledger and contriibutes to the integrity of the ledger by implementing a Consensus Algorithm |

## Introduction
International trade clearance procedures require a number of documents to be presented to satisfy the requirements of a variety of agreements. For example, in order for an importer to gain preferential tariff treatment under a Free Trade Agreement, the importer must present a valid Certificate of Origin (issued to the exporter) which states that the goods being imported qualify as originating in the country which is party to the agreement. These processes are managed largely by the transfer of paper documents which are subject to loss, alteration and forgery.
> FIXME
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there should be some text here describing the financial consequences of the last statement above


> FIXME
consise description of the problem that an ICL proposes to solve
e.g. Clearance of shipments can be delayed because of uncertainty around accompanying documentation, causing signifant costs to bla bla bla... most important statement in document.

## Goals
An Inter Customs Ledger is proposed as an apporach to the transfer of shipment related documents between customs agencies which is immediate, permanent and irrefutable.

This document uses Certificates of Origin as the guiding use case for the initial specification, however it is intended that the Inter Customs Ledger should be generic and allow for the transfer of any shipment related documentation between authorised agencies.

#### Background
There have been a number of recent projects which use blockchain to implement a system which allows the validation of Certifiate of Origin issued under some Free Trade Agreement. Singapore and Kenya have both worked with industry parter vCargo Cloud to implement blockchain Certificate of Origin solutions. The first Certificate of Origin for a shipment from the UK was issued by {who?} in {month?} 2018 and in {when?} the United States were looking into the use of blockchain to validate Certificates of Origin for shipments made under {old agreements?}. These projects have highlighted the necessity for digital, blockchain based solutions to exist alongside paper based processes in the short term, requiring the continued existance of some mechanism for validating the authenticity of a paper certificate.

## Status
Before the prevalence of distributed ledger technology, the common approach to providing for assurance as to the validity of a Document was largely achieved with the idea of a hub. there are a number of implementations of this approach which may be instructive: ICC Certificate of Origin verification website, EPIX, ePhyto thing, etc...

The link below provides a number of resources which attempt to give an overview of the landscape of blockchain based projects related to both Certificates of Origin and International trade in general

[Survey of Blockchain Based Approaches to Managing International Trade Documentation](precedents.md)

## Glossary
#### Users
> FIXME
> list of parties and their roles etc. maybe just sticking to CoO process initially?
> exporter - applies for certificate
> authorised body - issues certificate
> importer - applies for preferential tariff treatment, etc
> customs authority - grants preferential tariff treatment

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#### Example Scenarios
> FIXME
> provide step by step description of the end to end process for a simple scenario, and a more complex one, focussing on the creation and transfer of documents.
> Get full list of documents required for a simple case where only additional
> documentation beyond generic shipment documentation is a Certificate of Origin
> maybe a wine shipment?
>
> as well as all documents required for a more complex scenario, maybe orchids (certificate of origin, CITES, phytosanitary...) as well as full list of parties involved (e.g. Customs, CMA, Quarantine, CoC)

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#### Open Questions

##### What is the relationship between a party running a node and a party authorised to view the contents of a Document?
This goes to the question of what content of a given document is available on-chain. Some options are:

> FIXME
> elaborate on each of the options below
> 1. all document content is on-chain and encrypted
> 2. document content is published by the issuing authority (who manages access) and only a reference to the document and it's hash is on-chain
> 3. all document content is on chain and not encrypted (being a node is the same as having authority to view document details)

##### Should an Inter Customs Ledger manage the state lifecyle of a Document?

##### What is a Document in the context of the Inter Customs Ledger?
> FIXME
discuss these two conceptual approaches:
> 1. a thing added to the chain by an authorised body which has state and allows some party to take some action dependant on that state?
> 2. a digital asset granted to a party that allows that party to trade the asset for some service?

##### What is the appropriate 'chain of custody' of a document in the context of the Inter Customs Ledger?
> FIXME
e.g.
export customs -> import customs
authorised body -> exporter -> importer -> import customs

##### How should the ICL function in the context of an existing legislated paper based process?
> FIXME
other projects have maintained paper certificates and implemented print management solution and QR code for validation
review chapter 12 and artice 4.6 of ChAFTA for reference

## Design Goals

**Avoid proliferation of ledgers**
> FIXME
i.e. reduce burdon on parties wishing to join network

**Maintain privacy of document content**
> FIXME
i.e. a node on the network may not be authorised to view the content of a document

**Collect meaningful data about the use of a Document**
> FIXME
i.e. some state management to prevent double spend and track documents etc


## Future Directions
> FIXME
increase breadth and depth covered with interledger protocols.
e.g. trade finance related processes may be managed on some other ledger which might need to reference the ICL for validation of the existance of a CoO.
or
before a certificate of origin is issued, some other ledger may track the provenance of a product and it's purchase by the exporter, opening the possibility of execution of smart contract for issuance of CoO

Phrase | Definition
------------ | -------------
|

This service depends on - TBA.

@@ -53,15 +145,15 @@ if not, see [http://www.gnu.org/licenses](http://www.gnu.org/licenses).
The key words "MUST", "MUST NOT", "REQUIRED", "SHALL", "SHALL NOT", "SHOULD", "SHOULD NOT", "RECOMMENDED", "MAY", and "OPTIONAL"
in this document are to be interpreted as described in RFC 2119.

# Billing Process

# High Level Requirements
> FIXME
seperate the list below into sections? (Ledger, Network, Transaction)

1. Any Customs Authority SHOULD be able to participate in the ICL by running a Node
2. Participating in the network by running a Node SHOULD NOT grant access to the content of a document
3. A message on the Inter Customs Ledger MAY provide a mechanism for discovering the full content of the document to which it relates
4. The Inter Customs Ledger MUST provide a mechanism for preventing an importer or exporter from re-using a document which is intended to have a single use
5. The Inter Customs Ledger MUST provide some mechanism for asserting the validity of a document presented by an importer or exporter
6. The Inter Customs Ledger MUST provide some mechanism for invalidating a Document
7. The Inter Customs Ledger MUST provide some mechanism for specifying who can perform certain actions with respect to a Document

## State Lifecycle



# Related Material

*
*
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# Survey of Blockchain Based Approaches to Managing International Trade Documentation

## General Reading

> FIXME
write brief summary of these things

[WCO news October 2018](https://mag.wcoomd.org/uploads/2018/10/WCO_News_87.pdf)

[Can Blockchain revolutionise international trade?](https://www.wto.org/english/res_e/booksp_e/blockchainrev18_e.pdf)

[UNECE Blockchain Whitepaper](https://uncefact.unece.org/display/uncefactpublicreview/Public+Review%3A+Blockchain+Whitepaper)


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## Certificates of Origin

### Singapore

- partnership between Singapore International Chamber of Commerce and vCargo Cloud
- retains paper certificates
- certificate can be verified using QR code
- provides some mechanism for restricting allowable prints
- private ledger

**resources**

https://www.maritime-executive.com/article/certificate-of-origin-blockchain-platform-launched

http://fintechnews.sg/19677/blockchain/blockchain-based-e-certificate-of-origin-singapore-chamber-of-commerce/

### Kenya

- same system as Singapore (vCargo Cloud)

**resources**

https://www.gtreview.com/news/africa/blockchain-based-certificates-of-origin-come-to-kenya/

https://cryptotvplus.com/kenya-gets-blockchain-based-e-certificate-of-origin/

### United States

- Piloting blockchain system to verify NAFTA and CAFTA certificates of origin

**resources**

https://home.kpmg/xx/en/home/insights/2018/08/tnf-united-states-cbp-blockchain-testing-for-certificate-of-origin-verification.html

### United Kingdom

- certificate issued using Bristol Chamber of Commerce's e-z cert system
- looks like the technology parter for the prototype (i2i infinity) are the providers of e-z Cert
- paper certificate provided to comply with existing regulations
- also uses QR code on certificate to allow validation
- uses Ethereum
- i2i infinity looking to use Fabric in future in order to align with IBM and Maersk

**resources**

https://www.i2i-infinity.co.uk/blog/post/15667


## Technologies

[Hyperledger Fabric](https://www.hyperledger.org/projects/fabric) is a framework for developing blockchain solutions where there are multiple parties interacting with different requirements for access to private data.

[Hyperledger Grid](https://www.hyperledger.org/blog/2019/01/22/announcing-hyperledger-grid-a-new-project-to-help-build-and-deliver-supply-chain-solutions) framework for developing supply chain solutions. In incubation phase.

[TradeLens](https://www.tradelens.com/)


## As yet uncollated list of possibly interesting/relevant things

https://www.proofofexistence.com/

https://digitalcurrency.unic.ac.cy/free-introductory-mooc/self-verifiable-certificates-on-the-bitcoin-blockchain/academic-certificates-on-the-blockchain/

https://iccwbo.org/resources-for-business/certificates-of-origin/certificates-origin-verification-website/

https://certificates.iccwbo.org/

https://www.blockcerts.org/

http://certificates.media.mit.edu/

https://techcrunch.com/2018/05/07/learning-machine-credentials/

https://help.accredible.com/hc/en-us/articles/115003427425-What-are-Blockchain-Credentials-

https://www.esscert.com/chambers-of-commerce/

https://iccwbo.org/resources-for-business/certificates-of-origin/electronic-certificates-origin/

https://www.e-zcert.com/uk/

https://www.itnews.com.au/news/nsw-puts-digital-drivers-licence-on-a-blockchain-512298

https://www.coindesk.com/blockchain-perfect-government-services-heres-blueprint

https://www.eventbrite.com.au/e/wca-china-australia-wine-marketing-summit-tickets-53428628466

https://www.apacblockchain.com.au/

https://www.americanexpress.com/us/foreign-exchange/articles/blockchain-in-certificate-of-origin/

https://worldmaritimenews.com/archives/261893/pil-ibm-to-create-electronic-bill-of-lading/

https://www.ledgerinsights.com/cargosmart-deloitte-enterprise-blockchain-interoperability-kerry-logistics/

https://komgo.io/enterprise-blockchain-for-trade-financing/