Hunit - Smart Legal Contracts

The future of law is natively digital*

*says law firms and financial services groups in 6 countries interviewed by Hunit

Hunit’s solution offers lawyers, in-house counsel and the financial sector at large a platform to replace analogue agreements with natively digital, legally binding instruments (Smart Legal Contracts). It changes legal instruments from documents that sit in filing cabinets or on hard drives into dynamic, self executing SLC’s that automate important tasks and enforce agreed terms. They relieve law firms and counterparties from execution and regulatory risk and reduce the burden of court based resolution of breaches.

Our solution is made up of the following main components:

A distributed ledger network by and for legal system stakeholders

A distributed ledger network sits at the heart of the Hunit ecosystem. Nodes represent legal firms, financial services providers and industry partners that are licensed to create and manage SLCs. Each node independently verifies transactions and changes to the blockchain, assuring a safe and shared infrastructure for parties to enter into digitalized bilateral relationships with no intermediating party.

When an SLC is signed by its parties, it is recorded in the distributed ledger network where it completes its lifecycle. While the network is a shared resource amongst legal stakeholders, it is subject to robust data encryption. Based on adjustable privacy settings, a SLC can be viewable by all participants in the Hunit ecosystem, specified groups or only by its parties.

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Digital signing and identity management via mobile app

The Hunit ecosystem uses the mobile device as a key component in the critical function of managing identity. All participants in the Hunit ecosystem start through an onboarding process that automates KYC, KYB and AML checks. Once a digital ID has been created, it’s primary storage location is in the user’s mobile app – putting them in total control over their personal data via a distributed ledger based system for Self Sovereign Identity.

By using biometric readers built in to most mobile phones, Hunit replaces the inconvenience and poor security offered by passwords with a simple 2 step process where you confirm your identity on the mobile to authenticate actions that you take on the web portal. Fully compliant digital signatures, transaction confirmations and platform login are highly secure and also easy on the user.

Using the mobile app, participants can log in to and interact with Hunit’s web portal, where they review and sign SLC’s, interact with SLC’s that have already been entered into, and engage in a native decentralized market place (for bilateral trading and primary issuances of private market investments).

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SaaS tools to author SLCs

SLC’s are authored and managed by legal professionals using Hunit’s SaaS tools. They can be based on today’s document templates and authored by any legal professional comfortable with the Microsoft Word.

Our MS Word plugin allows for SLCs to be written inside of existing .DOCX files by adding self-executing Auto-Covenants to existing text, mitigating learning curves and adoption chain challenges. Our templating platform allows high volume contracting by using .DOCX based SLCs as templates and connecting to external data sources such as CRM or ERP platforms.

Going to court is losing, even if you win

A powerful feature in Hunit’s toolkit is its Covenant Engine, which provides the ability to automate the resolution of many types of events that result in contract breach and court-based enforcement or adjudication. In this process, the SLC authors identify the events that can trigger a breach of a specific clause or article and specify the actions that the SLC should take if such a breach were to occur. These actions can be based on successive steps designed to help bring the parties back into compliance (ending a breach) or, if incurable, execute upon the types of solutions usually offered by court-based adjudication (such as forced asset sales).

The act of pre-planning remedies has an additional benefit of helping to align counterparties. By discussing and anticipating what can go wrong in the execution of an agreement, transparency is increased and downside scenarios can be appropriately priced and risk-adjusted.

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SLC'c drive real-world actions

Self executing SLC’s interact with the ‘real-world’ through what we call Ecosystem Services. Each service is a stand alone application that Auto-Covenants in an SLC connect to in order to perform specific tasks.

Do funds need to be distributed to investors? The SLC connects to Hunit’s Settlement Engine to receive, send and monitor payments in the global banking system. Does a SLC need to obtain a decision from a group of investors? It uses Hunit’s Governance Engine to run a poll using the questions, answers and investor list defined in the SLC.

Hunit’s Ecosystem Services include:

  • KYC, KYB, AML gateway
  • Settlement Engine (integrate with the global banking system)
  • Governance Engine (interact with stakeholders individually or in groups)
  • Compliance Engine (assure the SLC and its participants meet regulatory criteria and that principles of corporate / financial law are respected)
  • Issuance Engine (create and manage digital, token-based certificates)
  • Marketplace (discover and transact bilaterally with peers in a decentralized marketplace native to Hunit’s distributed ledger network)

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