by David Fox, Professor of Common Law, University of Edinburgh
The England and Wales Law Commission has recently published its final report on Digital Assets (Digital assets – Law Commission). The report comes after an exhaustive study of the way that existing principles of private law in England and Wales would apply to this emerging class of assets. It is of great significance since digital assets are fast becoming mainstream vehicles for carrying out financial transactions as conventional forms of financial securities are adapted to work on blockchain technology. The report acknowledges that private law is as relevant to digital assets as the specialist regimes of financial services regulation that were the main focus of attention in the early days of their development.
The Law Commission report is relevant to Scotland which has an important fintech industry of its own but where the application of fundamental principles of Scots private law to digital assets remains obscure. Any new clarification of the legal rules in Scotland would need to allow for the subtle similarities and differences between English and Scots property law and for the divergent patterns of legal development in each jurisdiction.