UNIFORM ECONOMIC TRANSACTION PROTOCOL

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The economic internet

Presentation given by FOCAFETFor Open Convenient And Fair Economic Transactions

“Speaking the same economic language andmanaging the economy with entities”The Netherlands, August 20th, 2015

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FOCAFET

For Open Convenient And Fair Economic Transactions

Independent non-profit foundation to facilitate a united economy

Unifying transaction system (speaking the same economic language, through the ‘economic internet’ with UETP: all transactions in ‘here and now’ with all relevant stakeholders connected)

Unifying money (Project Phoenix)

Unifying financial products, introducing new forms of equity as substitutes for debt and interest

All on voluntary basis. Unifying economics outcompete economics that divide. Follow mustard

seed strategy. Proposition becomes stronger and stronger with more traction. Strong implicit network effects.

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The Economic Internet

The Economic Internet

enables everyone and everything to:

connect with each otherunderstand each other and

transact with each other

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The Economic Internet: Three requirements

Internet of Everything

Ability to express and interpret

(uniform) economic transactions

To connect people, organisations, things, machines, money, assets, data, rules, information, messages and transactions (so basically everything) with each other in (near) real time.

To express and interpret in a uniform way, who, what, how much, where, when, and how in economic transactions

Ability to execute (uniform) economic

transactions

CONNECT

To instruct and execute in a uniform way, identification, authentication, delivery, reporting, taxation, subsidies, authorisation, conditions, payments, reviews, ratings, insurance and participation and more in economic transactions

UNDERSTAND TRANSACT

THE ECONOMIC INTERNET

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CONNECTING EVERYONE AND EVERYTHING

People

Communities

Things, machines

Organisations

Messages Transactions

Data, rules and information Money, assets

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1. CONNECTING EVERYTHING: THREE STEPS

1) Generate a unique ID

2) Provide that unique ID with meaning (attributes and / or references), so that it relates to a person, organisation, product, thing, message, piece of information, etc.

3) Place that unique ID with meaning in a directory service so it can be found, understood or connected with

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Internet of Everything is Internet of Entities / Identities

UETP ID / certificategenerator

UETP IDs are generated without meaning.

Society links these IDs with entities and relevant meaning.

Who I am

examples

Electronic IDs of persons (eIDAS)

e-LEI IDs for organisations

What I have

examples

Asset registries, such as bank accounts, wallets

Products, such as e-barcodes

Digital moneyWhat I want

examples

Requests for quotes, information and orders

What I can

examples

Abilities offered to the market (product offers)

What we do

examples

UETP messages and instructions

UETP transaction IDs

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Evolving the internet: adding the ‘entity layer’

Note: Linked data, APIs, interfaces can be used to bring entity data into lower layers, legacy systems, required natural or computer language(s) and / or presentation formats

Identity creation Entity-identity binding Entity-attribute binding Entity-attribute management

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Entity directory services: similar to web domain names

Distributed register for entities with their identities and attributes

Distributed register for IP adresses with their domain names

DNS Servers

Entity Servers

Moving information management (like security, access, control and rights) upwards from application level to entity level

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The entity layer: Connectivity beyond APIs

API spaghetti Entity layers with distributed registers

“APIs resolve intra apps and organisation connectivity. APIs do not resolve inter apps and organisation connectivity.”

“Lower costs and risks, more trust and functionalities, better connectivity”

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Root CA and distributed entity registers (envisaged)

North AsiaSouth Korea

ME & AfricaUAE

South Asia Singapore

EuropeThe Netherlands

Latin America & CaribbeanPanama or Colombia

Australasia / PacificAustralia

North AmericaCanada

“Seven globally public entity registers strike a balance between federation and distribution on the one hand and speed and performance on the other.”

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IDs, Certificates and Directory Services

Unique ID numbers can be generated decentralised (variant on UUID / RFC 4122), possibly with date-time and geo-stamps.

A highly secure, federated network of certificate authorities issue IDs (when required with certificates and public-private key pairs). Anybody who adheres to minimum UETP standards can be part of a federated UETP certificate authority network.

These IDs are initially agnostic (= without meaning) and then are used to label anything, from messages, to transactions, subjects, people, organisations, objects, things, money, wallets, etc.

Highly secure authentication, encryption and signing (Levels of Security 3-4 and Levels of Assurance 1-4 possible. Levels 4 are highest possible according to ISO 29003/29115 standards)

Directory services - like a big telephone book - make it possible that everyone and everything can find and connect with each other.

Existing legacy IDs (like national eID systems, property registers, bank account numbers) can be made interoperable by referencing.

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Examples of UETP IDs / certificatesID type Practical example

Personal IDA personal electronic identity of Thomas Bauer, issued by a German bank, under the policies of a competent German policy authority governed by the laws and principles of the European Union

Organisation ID An organisation electronic ID along the lines of the Global Legal Entity Identifier Framework

Asset ID An electronic asset ID representing a vehicle with its unique manufacturing and local registration number and legitimate owner

Machine ID An electronic ID of the traffic light around the corner

Money ID An electronic wallet ID representing digital money

Message ID A message ID referencing to a delivery confirmation in a transaction

Information ID An ID with product description details and translations

Rule set (legal) In the legal jurisdiction of the Netherlands, no alcohol can be sold in transactions to people younger than 18 years

Rule set (fiscal) In the fiscal jurisdiction of Mongolia, the transaction tax for sales / purchase transactions of milk is 15% and can be paid automatically.

Transaction ID Representing a container and reference ID for all IDs that together make up for a specific transaction

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Real-time-relevant-authority-routing

UETP IDs can be issued with accurate, verified and independent date-time and geo-stamps.

In almost all cases, except in disputed territories or extreme proximity to borders, legal and fiscal jurisdictions can be determined automatically in real time (the option for manual overwriting exists, with potentially reduced levels of assurance).

With additional information on products, contract types, amounts and possibly persons or organisations, transactions can automatically be routed to the relevant competent authorities.

If such authorities create rule sets for fiscal and legal clearance, automated tax filing (and payments) and legal compliancy checks could be realised.

In a world in which half of the transactions will be processed online in the next decade, jurisdictions and authorities will start competing on modus operandi (online real time transaction clearing).

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From 'separate service communication' to one 'group chat'

Traditional transactions

UETPtransactions

Several separated two, three and four party communication models

The n-party “group chat”

Buyer Seller

Buyer'sBank

Seller'sBank

LogisticsSolutionProvider

Buyer'sFiscalAuthorities

Seller'sFiscalAuthorities

Buyer'sERP andaccountant

Seller'sERP andaccountant

Machinesand IoT

Other...

Buyer Seller

Buyer Seller

Buyer Seller

Buyer'sBank

Seller'sBank

LogisticsSolutionProvider

Buyer'sFiscalAuthorities

Seller'sFiscalAuthorities

Payment

Delivery

Taxation

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2. UNDERSTANDING EVERYONE AND EVERYTHING

“SPEAKING THE SAME (ECONOMIC) LANGUAGE”

UETP enables the global exchange of manageable and interpretable information

“In the digital age, your environment takes you as far as the acceptance of your language and data formats”

“We can either choose to create our own languages and formats and ask others to comply or we can make a joint effort to create and accept a common language with common data formats”

“UETP brings the smart transaction receipt that pays for itself, automates delivery, accounting and taxation and lots more.

The transaction is smart, because its expression is interpretable (understandable)”.

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Saying the same things in a billion different ways

Domain Type of information Example

Who Buyer and seller information Identities and preferences

What Product / service information HS (product) codes

How much (Counter)value information Amount and currency

When Date, time and timezone Date / time stamp

Where Place(s) and jurisdiction(s) Geo-, country codes

How Contractual information Sales, labour, investment

Other Other information Manuals, promotions, ...

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The need for uniform understanding – Two colliding worlds

Economic growth becomes more communication intensive. Meanwhile, data formats for communication grows too.

This will lead to exponential growth of costs.

Growing number of rules, guidelines, policies and data formats over time

2000 2007 2015

Relationships in global growth, with increasing number of messages (communication) in transactions

economytradetransaction instructions

vs.

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UETP is an ecosystem language – HTTP vs UETP

With UETP, one request instruction can be interpreted and executed to all parties simultaneously that accept to work with UETP.

Together they can process transactions in real time.

HTTP is written for specific applications on specific servers, not for an ecosystem. The search query for 'UETP' with Google and Yahoo yielded the following in my browser:

https://search.yahoo.com/search;_ylt=A0SO803tJU1UqzIAh4RXNyoA;_ylc=X1MDMjc2NjY3OQRfcgMyBGZyA3lmcC10LTMyNS1zBGdwcmlkAwRuX3JzbHQDMARuX3N1Z2cDMARvcmlnaW4Dc2VhcmNoLnlhaG9vLmNvbQRwb3MDMARwcXN0cgMEcHFzdHJsAwRxc3RybAM0BHF1ZXJ5A3VldHAEdF9zdG1wAzE0MTQzNDIxNjE-?p=uetp&fr2=sb-top-search&fr=yfp-t-325-s&fp=1

https://www.google.com/search?q=uetp&ie=utf-8&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&channel=sb&gfe_rd=cr&ei=HCFNVMm7G-eK8QefmYH4CA&gws_rd=cr&fg=1#rls=org.mozilla:en-US:official&channel=sb&q=uetp

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It's all about agreement on semantics and formats ...

The global ability to communicate with the most important verbs and interrogatives:to be, to have, to do, to want, to can and who, what, when, where, why, how, etc.

Who I am What I haveIdentity User profile Things, money, assets, accounts

What I want How to do it What I canPreferences Transaction Data Abilities / availabilitiesRequest for information Who, What Product offersRequest for quote When CataloguesOrder request Where Price informationExecution management How PreferencesOther information Other information Other information

= UETP transaction instruction

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UETP as a Smart or Self-Executing Transaction ReceiptOrganisation name and logo(organisation details, etc.)

Date and timePlace(s) and jurisdiction(s)

Contract type: Simple sales / purchasePrivacy and disclosure: Anonymous to seller

=====================================

Product(s) 1 $ 10.00

Discount -/- 10% $ 1.00

Returned goods $ -=======

- Subtotal without taxes $ 7.20

- Tax type(s) and percentage(s) (20%) $ 1.80=======

TOTAL $ 9.00

------------------------------------------------------------------Buyer-name / anonymous, etc.

Payment status and amount PAID $ 9.00Delivery status DELIVERED AT CHECK OUT

Updated into my accounting system YES

------------------------------------------------------------------

Loyalty program points change + 72

=====================================

Approval / reporting regulatory authority 1 YESApproval / reporting regulatory authority 2 YESAudit level of assurance Level 3

Identification and authentication: The receipt knows who the seller is, with relevant transaction information such as a bank account and address information. The seller is authenticated. Also the buyer and other stakeholders in the transaction can be identified and authenticated.

Ownership, Use and Wallet Management: Loyalty points can be added to or deducted from the loyalty program(s) that the seller provides and the buyer prefers

Authorisation, monitoring and control, data and privacy management: With basic instructions and information about the transaction, the transaction can connect to the right parties, such as legal authorities, etc.

Ownership, use and wallet management, information, accounting and reporting: The receipt can transfer ownership from seller to buyer and manage user rights of goods, services, objects or money.

Taxation and subsidisation: Taxes and subsidies can be paid automatically with information about the right (fiscal) jurisdiction, transaction contract type, product type, amounts and relevant buyer and seller information

Conditions and escrow management / payment, clearing and settlement / information and reporting, delivery, billing and shipping : All kinds of transaction details can be shared with each other automatically, bringing new interactions and clarity of status to all.

Security and Audit: The electronic and transaction environment is audited for security and authentication. An audit level of assurance is provided.

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UETP – Generating uniform interpretable transaction data

Domain How UETP transaction data is created

Who

What

How much

When

Where

How

Other

* geo stamping technologies, embedded in the UFCA can determine and verify location

UETP identity IDs: Stakeholder identities, preferences and information (can be references to existing identities, information and systems)UETP goods / services IDs: Product / service descriptions and information (for instance referenced HS codes, United Nations, ICC, GS1, ISO, EC, etc.) UETP currency and measurements IDs (possibly referencing to ISO, etc.) and numeric notations to express quantitiesUETP date – time stamp, issued and verified for any required message, transactions, etc., by UETP federated certificate authority (UFCA)UETP geo stamp (incl. administrative jurisdiction and / or GPS coordinates), issued and verified for any required message, transaction, etc. (by UFCA) *UETP legal, supervision and fiscal information IDs containing contractual description information (with possible references to existing standards)Other free format information to be structured further towards the future in the UETP community such as warranty, manuals, etc.

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3. TRANSACTING WITH EVERYONE AND EVERYTHING

Identification and

authentication

Data and privacy management

Billing,delivery and

shipping

Security and audit

Ownership, use and wallet

management

Authorisation,monitoring and

control

Information, reporting,

accounting, ERP

Taxation and subsidisation

Conditionsand escrow

management

Paymentclearing andsettlement

PlaceholderRating and Review

PlaceholderParticipation, Risk and Insurance

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How transactions have been processed traditionally

Transaction services almost all use similar information, though they do use

different data formats and procedures

Buyer / SellerGood / Service

Amount / CurrencyDate / Time

Place(s)Legal contract






















Who?What?

How much?When?Where?How?







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Transactions according to UETP




Other information

2. Identification, authentication and biometrics

4. Data Management and

Privacy

3. Security and Audit

8. Authorisation, Monitoring and

Control

5. Ownership, Use and Wallet

Management

A uniform way to define and describe transactions and instructions A uniform way to process economic transactions Norms for a safe, secure and well-functioning infrastructure An open, federated, decentralised and organically transformative

governance structure

9. Conditions and Escrow

Management

10. Payment Clearing and Settlement

11. ERP, Ledger and Information

1. Request for transaction

12. Response to request

7. Taxation

6. Delivery, Billing and Shipping

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Major improvements in risk and compliancy Parties and applications work with same information No more translation differences Improvements in client privacy and data management Higher Straight Through Processing inside and outside the

organisation Real time consent of all parties involved in transaction Minimising risks of partially processed transactions Supervisors and regulators have same information at same time,

reducing compliancy risks Banks / telcos / trust service providers can provide levels of trust

and assurance in security and authentication Potentially more and better structured data (attributes) available for

authentication and security.

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Why UETP? – Different reasons, depending on users

UETP, like any language, has different benefits for different users in different situations.

“It enables me do to everything in real time.”

“Finally, ownership and control over the data that I generate.”

“Insourcing and outsourcing has become so much easier.”

“Creating partnerships in real time.”

“No more tax filing. Taxes can be paid automatically.”

“Substantial savings in working capital.”

“Things have become so much more efficient.”

“I increasingly buy things from companies I did not even know existed.”

“Real time compliancy assurance, provides so much comfort.”

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HOW

FOCAFET as facilitators to open development How UETP is being developed Examples When and where Putting UETP into context

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FOCAFET – Foundation supporting the UETP initiative

For Open Convenient And Fair Economic Transactions

Adheres to “This is for everyone” - principle (internet way) UETP protocol is free to use Non-profit foundation, no direct benefits to management Facilitates open, federated, decentralised governance models Is transparent and organically transformative Facilitates open source, royalty free, patent free co-creation By design, no third party trust required By design, no role in transaction execution Intends to minimise itself, avoiding power creation

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UETP – based on a dynamic knowledge model Knowledge of transactions is captured in an open dialogue and open

knowledge model. For instance, we can discover requirements for concepts of a 'buyer' and a 'seller' and functionalities of 'payment' and 'delivery' in a transaction, then these are added to the model.

Knowledge modeling happens by highly specialised, trained and dedicated UETP knowledge modelers

The knowledge model grows automatically, when more knowledge (concepts and functionalities) are added.

Concepts and functionalities appear once (no duplication) in the knowledge model and are defined in the UETP list of terms

Concepts and functionalities are dynamically linked to establish relationships. The knowledge model is kept simple by design

The knowledge model is translated to a data model and to transaction message types. Supporting all knowledge (concepts and functionalities) that has been generated by the community.

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UETP – Semantics and knowledge model combined

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Standardisation practices and UETP standardisation

With UETP, we set a time line for a goal, get input from various good practices and vote. Semantically, there is no duplication and from a

broad functional base, we can support most existing standards

Some standardisation practices

Closed discussion Not-continuous Formal communications Imposed, standard to value Static, from the top down Political, formal Slow turn around Fragmented bits and pieces Weaker network effects Little enforcement means

'UETP standardisation'

Open discussion Continuous Real time dynamics Voluntary, value to standard Organic growth from bottom up Consensus, co-creative Fast turn around Global Stronger network effects Transaction certification

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How the UETP knowledge model is built

Mobilise and build

co-creation platform

Deliver pilots to build knowledge and functionalities

Create common language and embed in daily use

Global, multi-party co-creation platform representing interests of key stakeholder groups in global transactions (also non-economic).

The value, usage and workings of UETP are demonstrated by connecting to existing international transaction initiatives and leveraging both existing and emerging standards from partners.

Setting up and maintaining an ecosystem which establishes uniform and accepted data definitions, standards and protocols, which can be used by all.

COMMONLANGUAGE

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Live case: eID (UETP eID on eIDAS)

UETP eID has come to the market as a European eID, compliant to latest developments and insights, such as eIDAS, ETSI-EN and Personal Privacy Protection.

UETP eID is brough to the market commercially before year end 2015 Implementations possible at Level of Assurance 4 and ‘4+’ (ISO and STORK

respectively. UETP eID is registered with certificate authorities and browser forum members,

assuring operability in browsers, phones and tablets. UETP eID can also be used internally in organisations. UETP eID can be used commercially by organisations, while technical and legal

liabilities can remain with a third party (a certificate authority). In many countries, certified identity assurance levels can be provided by certified and

authoritised specialist couriers. UETP eID can be used with the UETP protocol to engage in many different

transaction contexts with wide application uses and a broad user community. UETP eIDs can engage in an any number of stakeholders interaction. Most eID solutions do not have such protocols supporting this.

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Pilot: e-barcodes

Working towards a (UETP facilitated) e-barcode solution with GS1 (the global standard organisation for barcodes, maintaining all barcodes in their databases).

UETP unique ID numbers can be used to provide unique serial numbers (a defined requirement of GS1)

UETP can add certification and assurance functionalities to the e-barcode issuer (“this e-barcode is really from this issuer – this bag is really from Louis Vuitton”)

UETP can add encryption / decryption functionalities to e-barcodes. E-barcodes can be placed and routed in encrypted form in the cloud and can be decrypted (read) by those who are supposed to see it (those with decryption keys).

UETP e-barcodes can be legally signed UETP directory services with e-barcodes, can provide a registry for barcoded

products Transfer of ownership and control of barcoded products can be provided with UETP

enabled e-barcodes and UETP eIDs for persons and organisations.

e-

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Pilot: certainty for both buyer and sellerA common, traditional problem on the internet is that the buyer wants to have certainty of delivery and the seller certainty of payment. Either the buyer or seller has to pay or deliver upfront.

Traditionally, the payment and delivery processes are managed as two separate transactions.

We created a pilot where money for the transaction was reserved.

When the buyer enters a pin code with the deliverer of the product, the buyer receives the product and payment is committed to the seller.

A screenshot from the live pilot production environment

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Pilot: 'UETP group chat' - merchant supply chain finance

Bringing the relevant parties together in one group chat, having them to share and work on the same transaction information, allowed for new and easier forms of promise to pay and receivables finance.

Working capital costs and treasury costs reduced substantially as a result.

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Pilot: Privacy in the internet of everything




Other information

Identification and authentication

Data and privacy management

Security and audit

Request for transaction

Response to request

Step 1 Step 2 Routing of information

Bank and card information

Delivery information

Fiscal information

The seller no longer obtains buyer's bank or credit card details or the delivery address.Information can be provided to those who have a need to know.

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Pilot: No more tax filing




Other information

Request for transaction

Response to request Fiscal

information

85 – 90% of global taxes are transaction taxes. They can be taxed automatically withinformation that holds jurisdictions, amounts, product descriptions, contract types, etc.

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Roadmap - When

• Two page vision idea (Feb 2014)

• Evolving pilots on basis of UETP

• First (commercial) applications are live (Q1)

• UETP as a Service becomes a reality

• First UETP protocols in place (version 0.1 in Q1)

• Root Certificate Authority and Directory Services in place (Q4)

• UETP protocols in place with enhanced functionalities

• Supporting most global transaction functionalities in 2016H1

20142015

2016

✓

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THE ECONOMIC INTERNET

LET'S MAKE THIS WORK TOGETHER

UNIFORM ECONOMIC TRANSACTION PROTOCOL

Technology

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