An Australian federal agency is developing a blockchain that will allow businesses to carry out transactions based on smart legal contracts.
The Commonwealth Scientific and Industrial Research Organization (CSIRO) said on Wednesday that its research arm, Data61, is working with law firm Herbert Smith Freehills and IBM to conduct a pilot for a new platform called the Australian National Blockchain (ANB).
The technology is aimed to let businesses automate transactions based on pre-defined legal terms – designed to comply with Australian regulations – coded into smart contracts on top of an IBM-powered blockchain network.
The scheme will set up smart contracts that have the ability to record external data sources, such as from internet of things (IoT) devices, and can self-execute once specified conditions are met.
“For example, construction site sensors could record the time and date of a delivery of a load on the blockchain and trigger a smart contract between the construction company and the bank that would automatically notify the bank that terms have been met to provide payment on that load delivery,” the agency explained in the announcement.
The group said the pilot is expected to start by the end of 2018 and that it plans to invite regulators, banks, law firms and other businesses in the country to participate. Ultimately, it plans that Australian companies can join the network to harness its digitized contracts, swap data and confirm the authenticity and status of legal contracts.
The effort follows recent research conducted by Data61 in 2017, with research scientist Dr. Mark Staples saying that distributed ledger technology is a “significant opportunity for Australia to create productivity benefits and drive local innovation.”
CSIRO indicated it intends to launch the technology to markets besides Australia if the pilot test proves successful.