Digital Assets (Scotland) Bill: child rights and wellbeing impact assessment

Child Rights and Wellbeing Impact Assessment Template

Brief Summary

Guidance: See section 2.1.2, pages 12-13 in Internal CRWIA and SoC for more information)

Type of proposal:

• Bill

Name the proposal, and describe its overall aims and intended purpose.

Digital assets are transforming the financial sector and present new economic opportunities; however, their legal status as property under Scots law requires greater clarity and certainty. It is important that our laws support and keep pace with developments in innovation and financial technology, and provide greater legal certainty for individuals and businesses including those investing in digital assets, for technology and financial start-ups, as well as for the legal sector.

The Scottish courts have not had an opportunity to provide judicial authority on the legal status of digital assets as objects of property. In 2019, the Scottish Government appointed the Digital Assets in Scots Private Law: Expert Reference Group (“ERG”), chaired by the Rt Hon Lord Hodge, Deputy President of the Supreme Court, to review the existing legal framework to advise if legislative change was necessary. The ERG concluded that greater certainty in Scots private law would be beneficial and reported several recommendations on how this could be achieved. Its main recommendation was that primary legislation be enacted through the Scottish Parliament. The Scottish Government published a consultation on these recommendations, which were well supported in general, with strong support for primary legislation in particular.

The primary purpose of the Digital Assets (Scotland) Bill (“the Bill”) is to provide greater legal certainty by confirming that digital assets to which the Bill applies can be objects of property under Scots law. One of the effects of the Bill is to confirm that certain kinds of digital asset can be objects of property in Scots private law. This category of digital assets is defined by reference to defining statutory characteristics. The Bill confirms the type of property that digital assets are classed as and determines key features as to how digital assets will operate in Scots property law, namely with respect to how ownership is established and the rules governing the voluntary transfer of ownership. It is not intended that the Bill will set out all of the legal principles or rules of Scots private law applying to digital assets or will cover a large number of matters concerning digital assets in various areas of Scots private law.

Start date of proposal’s development: May 2025

Start date of CRWIA process: May 2025

1. With reference given to the requirements of the UNCRC (Incorporation) (Scotland) Act 2024 (Annex 1), which aspects of the proposal are relevant to/impact upon children’s rights?

Guidance: If there are no aspects of the proposed which are deemed relevant to the UNCRC requirements, please give a short explanation of that here and contact the CRWIA team to discuss your response to this question. See pages 13-16 in Internal CRWIA and SoC for more information.

The Bill will be a short and focussed piece of legislation that will have a narrow scope of application. The Bill is technical in nature. The Bill is focussed on clarifying the status of digital assets as objects of property for the purposes of Scots property law, confirming how the ownership of digital assets is established and voluntarily transferred, and confirming that the general principles of Scots private law apply to digital assets that are objects of property, so far as those principles are consistent with the nature of digital assets.

The Bill is therefore not considered to be relevant to any of the UNCRC requirements (as incorporated).

While the UNCRC requirements do not include any rights in relation to the ownership of assets by children under the age of 18, we note for completeness that the Bill does not make any specific provision as regards children under the age of 18 who may own digital assets. In addition, the Bill does not alter or affect in any way the existing Scottish legislation which determines (among other things) the age at which a person reaches full adult legal capacity in Scotland and the types of transactions which may be entered into in Scotland by children under the age of 16.

2. Please provide a summary of the evidence gathered which will be used to inform your decision-making and the content of the proposal

Guidance: It might be that no aspects of the proposal are deemed relevant, and therefore, no evidence exists relevant to the assessment. If that is the case, questions 3, 4, 5 and 6 can be answered as ‘not applicable’ and question 7 can be answered as ‘no impact’.

Where consultation and engagement was carried out please tell us what you did (survey, focus groups etc) and a summary of what was said. If relevant include any key direct quotes. See pages 16-19 in Internal CRWIA and SoC for more information.

Evidence from:

• existing research/reports/policy expertise

Not applicable

• consultation/feedback from stakeholders

The Scottish Government consultation: “Digital Assets in Scots Private Law: Consultation” was open between 27 November 2024 and 5 February 2025, with its proposals informed by the recommendations of the ERG.

Due to the subject matter under consideration, the consultation did not expressly ask consultees what direct or indirect impacts there would be on the rights of children and young people under the UNCRC requirements (as incorporated into Scots law) and on the wellbeing of children and young people if the recommendations were to be implemented.

However, no respondents raised any impacts on specific groups of children, or their rights under the UNCRC requirements (as incorporated) as a result of implementing the ERG’s recommendations via possible future primary legislation on Digital Assets.

• consultation/feedback directly from children and young people

Not applicable

3. Further to the evidence described at ‘3’ have you identified any 'gaps' in evidence which may prevent determination of impact? If yes, please provide an explanation of how they will be addressed

Guidance: See page 19 in Internal CRWIA and SoC for more information.

Not applicable

4. Analysis of Evidence

Guidance: Please explain what the evidence told you about the impact of the proposal on the rights and wellbeing of children and young people. See pages 19-20 in Internal CRWIA and SoC for more information.

Not applicable. The evidence from consultees does not highlight any impact on the rights of children under the UNCRC requirements (as incorporated) as a consequence of the provisions in this Bill.

5. What changes (if any) have been made to the proposal as a result of this assessment?

Guidance: See page 20 in Internal CRWIA and SoC for more information.

Not applicable