UK Jurisdiction Taskforce Publishes Report On Control Of Digital Assets

The UK Jurisdiction Taskforce's Control Panel has published its Report on Control of Digital Assets (the "Report"). The Report provides non‑binding, practical guidance on how factual control arises and operates in digital asset systems and how that understanding can assist legal analysis under English law.

The Report was prepared by an expert panel of lawyers and technological experts, chaired by Lord Justice Zacaroli. As the Master of the Rolls, Sir Geoffrey Vos, observed, "Lord Justice Zacaroli and his multi-talented drafting team have produced an excellent piece of work, which explains with conspicuous clarity how the legal concept of control applies in practice to digital assets under English law."

Background and Legislative Context

In its 2023 Final Report on Digital Assets, the Law Commission concluded that certain digital assets require proprietary protection, but do not fit within the traditional categories of personal property; namely things that can be possessed ('choses in possession') and legal rights enforceable in court ('choses in action').¹

Its recommendation (now reflected in the Property (Digital Assets etc) Act 2025) was that an object should not be denied recognition as an object of personal property rights merely because it falls outside those two categories. Certain digital assets may, therefore, fall within a new 'third category' of property.

A fundamental aspect of personal property rights is the factual ability to exclude or permit access to a thing. Historically, the concept of 'possession' has served to identify this factual relationship.

In respect of third-category digital assets, the Law Commission identified 'control' as the most effective functional equivalent to possession. Control captures the same legally relevant features of the factual relationship between a person and a thing, but is not confined by possession's association with corporeal objects.

The Law Commission recommended that an expert panel produce non‑binding guidance on how control manifests in practice. The UK Jurisdiction Taskforce's Control Panel seeks to provide such expert guidance.

Scope and Purpose of the Report

The Report is a practical resource to assist court users and judges in understanding digital assets and how they are controlled. It addresses certain current digital asset systems, key terminology and emerging technologies and mechanisms. The Report provides a glossary of terms such as 'smart contracts' that will no doubt be of assistance to practitioners in transactions and in disputes.

While acknowledging the vast and complex body of knowledge necessary to understand digital assets, it does not attempt to provide a comprehensive technical explanation that is unlikely to be accessible or of practical assistance to many users. Rather, it sets out foundational principles and identifies common real-world examples and key concepts to assist users in understanding how factual control can be exercised over digital assets.

How Control can be Exercised

The Report examines various means of control in the context of digital assets, including direct control through the possession of a private key to authorise transactions, smart contracts which can perform actions automatically according to predefined rules, and delegated control through exchanges and custodians.

It also considers emerging privacy-oriented systems which can conceal transaction details on-chain or a controller's identity, thereby limiting what can be proven without a controller's cooperation.

Why This Matters for Trading and Disputes

By providing a factual framework, the Report enables parties and courts to identify who can exercise control over a digital asset and how that control is implemented in practice. This understanding can, in turn, assist in clarifying jurisdictional issues, issues in dispute, and establishing title and appropriate remedies.

Additionally, it helps parties to anticipate where evidential limitations may arise (e.g., in respect of privacy‑oriented systems).

The Report contributes to the creation of greater legal certainty in relation to digital trading and disputes concerning digital assets. 

Footnote

1. The Law Commission's Final Report draws on the conclusions of the UK Jurisdiction Taskforce's Legal Statement on Cryptoassets and Smart Contracts (November 2019); see also our Legal Update, "UK LawTech Delivery Panel Publishes Legal Statement: Cryptoassets Constitute Property under Common Law Principles."