TY - JOUR
T1 - The Recognition and Regulation of Smart Contracts in South Africa M VAN ECK & F AGBEKO PER / PELJ 2024(27)
AU - van Eck, M.
AU - Agbeko, F.
N1 - Publisher Copyright:
© 2024, North-West Unversity. All rights reserved.
PY - 2024/1/5
Y1 - 2024/1/5
N2 - Our understanding of contracts continues to evolve. Electronic contracts that have typically taken the form of shrink-wrap, click-wrap, web-wrap, scroll-wrap, multi-wrap and sign-in-wrap agreements have undergone further developments with the introduction of automation in electronic contractual engagements and, more recently, the advent of the so-called "smart contract". Different types of smart contracts exist, including smart contracts that operate on blockchain technology. Despite these developments in commercial and contractual activities, the South African legal framework does not officially recognise smart contracts. The use of the Electronic Communications and Transactions Act, 2002 (ECTA) as a mechanism for the regulatory oversight of smart contracts in South Africa is, in its current form, woefully inadequate and limited in its application to smart contracts. Other jurisdictions, like the European Union (EU), have passed draft legislative and regulatory documentation called the Data Act to address smart contracts, whilst the UK Law Commission has provided recommendations to regulate smart contracts. As South Africa currently has no equivalent to the EU's draft Data Act and has not considered the operation of smart contracts in South Africa, the position in the EU and United Kingdom (UK) is considered in this paper to provide guidelines as to the aspects that it would be necessary to regulate in a South African context.
AB - Our understanding of contracts continues to evolve. Electronic contracts that have typically taken the form of shrink-wrap, click-wrap, web-wrap, scroll-wrap, multi-wrap and sign-in-wrap agreements have undergone further developments with the introduction of automation in electronic contractual engagements and, more recently, the advent of the so-called "smart contract". Different types of smart contracts exist, including smart contracts that operate on blockchain technology. Despite these developments in commercial and contractual activities, the South African legal framework does not officially recognise smart contracts. The use of the Electronic Communications and Transactions Act, 2002 (ECTA) as a mechanism for the regulatory oversight of smart contracts in South Africa is, in its current form, woefully inadequate and limited in its application to smart contracts. Other jurisdictions, like the European Union (EU), have passed draft legislative and regulatory documentation called the Data Act to address smart contracts, whilst the UK Law Commission has provided recommendations to regulate smart contracts. As South Africa currently has no equivalent to the EU's draft Data Act and has not considered the operation of smart contracts in South Africa, the position in the EU and United Kingdom (UK) is considered in this paper to provide guidelines as to the aspects that it would be necessary to regulate in a South African context.
KW - 4IR
KW - blockchain
KW - ECTA
KW - Electronic Communications and Transactions Act
KW - fourth industrial revolution
KW - Smart contracts
UR - http://www.scopus.com/inward/record.url?scp=85204407218&partnerID=8YFLogxK
U2 - 10.17159/1727-3781/2024/v27i0a16383
DO - 10.17159/1727-3781/2024/v27i0a16383
M3 - Article
AN - SCOPUS:85204407218
SN - 1727-3781
VL - 27
JO - Potchefstroom Electronic Law Journal
JF - Potchefstroom Electronic Law Journal
ER -