Companies that are looking for a leading position in the market, reduction of transaction costs and more security in the execution of contracts, should know the smart legal contracts, which will certainly be increasingly used, due to the benefits of the Blockchain, and the need to adapt to the effects of the Technological Revolution.
In the smart legal contracts, the contractual conditions are evaluated and executed by codes and by a programming language. That is, the contractual terms are codified and placed in a Blockchain, are evaluated by a code system that determines if the conditions are true, and effective the automatic execution of the contract. Therefore, consequences agreed upon by the contractors will be self-executing when the defined conditions are fulfilled.
In this context, a practical example of the application of smart legal contracts stands out: an individual hires the services of an airline through a smart legal contract, that provides a reimbursement of a certain amount per minute of delay of a flight. If the delay happens, the contractual clause providing for reimbursement will be executed automatically.
Thus, the smart legal contracts will eliminate the need for a third party to execute the contracted object, which will significantly reduce contractual costs, since intermediaries charge very high fees for the mediation carried out. Besides that, the smart legal contracts will result in legal certainty for the parties, because the language of code does not give scope for ambiguous and divergent interpretations, mainly in relation to international contracts, since the variation of meanings in different languages will not prejudice the interpretation of the contractual terms, because they will be described in a computer language code.