I. COMPLETION OF A PRELIMINARY DRAFT CONVENTION 1
1997 saw the achievement of a major landmark in the Institute’s development of a number of international instruments on international interests in mobile equipment, to wit the establishment by the Study Group at its fourth and final session, held in Rome (3-7 November) of a preliminary draft Convention.2
At this session the Study Group also had before it as its main working document the revised draft articles which came out of the meeting of the Drafting Group (at its fourth session held in Würzburg, 24-26 July 1997), together with a considerable body of comments on these revised draft articles, coming not only from members of the Study Group, advisers thereto and those international Organisations, professional associations and other bodies represented thereon by observers but also, pursuant to an inquiry launched, at the Chairman of the Study Group’s specific request, from among those having responded to the Institute’s initial questionnaire (1992) on the subject as well as those having demonstrated an interest in the Institute’s work on this topic over the years.
Among the issues resolved at this final session of the Study Group was that of the relationship of the intended Protocols on matters specific to particular categories of equipment (namely aircraft equipment, railway rolling stock and space property) to the future Convention: first, the Convention will only enter into force in respect of a category of equipment at such time as the Protocol in respect of that category itself enters into force; secondly, the Convention will enter into force in respect of a category of equipment subject to the terms of the Protocol applicable to that category and, thirdly, the Convention will only enter into force in respect of a given category of equipment as between Contracting States that are Parties to the Protocol applicable to that category. These provisions, contained in Article X, indicate the Study Group’s awareness of the necessity of deferring in respect of a specific category of equipment to the sovereignty of States as evinced in their decision to become Parties to the relevant Protocol.
Another thorny issue settled at the final session concerned the connecting factor to be employed in the future Convention: in recognition of the fact that the Convention was designed to enhance financing opportunities, it was agreed that regard should in the first place be had to the obligor’s place of incorporation or registration or to the place where it had its principal place of business but that regard should alternatively be had to the place where the equipment was registered as to nationality or in some other State-authorised asset register or which otherwise had a close connection to that equipment.
The text of the preliminary draft Convention (subject to drafting refinements to be agreed upon subsequently by correspondence), will be laid before the Governing Council at its 77th session, to be held in Rome from 16 to 20 February 1998, for approval, subject to the granting of which it is the intention to convene governmental experts to hammer out a draft Convention capable of being submitted for adoption at a diplomatic Conference.
The Working Group responsible for the preparation of a preliminary draft Protocol on matters specific to aircraft equipment held two sessions, one in Montreal at the Headquarters of the International Civil Aviation Organization (I.C.A.O.) (25-27 August 1997) and the other in Geneva at the I.A.T.A. Building (19-21 November 1997), under the chairmanship of Mr J. WOOL.3
The preliminary draft Protocol will be forwarded for information both to the Governing Council and to the I.C.A.O. Council with a view to its serving as the basic working text for governmental experts in their preparation of a draft Protocol on the subject.
It was only in August 1997, following a meeting of the Space Working Group (Los Angeles, 1 July 1997) to consider the need for a Protocol on space property, that the President of UNIDROIT was able to invite Mr P.D. NESGOS, Mr S.H. SIEGEL and Professor D.S. SCHECHTER, as joint co-ordinators of the Space Working Group, to organise a Working Group responsible for the preparation of a preliminary draft Protocol on matters specific to space property. It is hoped that this preliminary draft Protocol will be ready for submission for information purposes to the Governing Council at its 77th session with a view to its serving as the basic working text for governmental experts in their preparation of a draft Protocol on the subject.
A Rail Working Group designed to examine the need for a Protocol on railway rolling stock held a first session in Brussels at the Headquarters of the Union of European Railway Industries (UNIFE) (30 September 1997). The Working Group noted the decision taken by the fourth General Assembly of the Intergovernmental Organisation for International Carriage by Rail (O.T.I.F.) (Athens, 8-11 September 1997) to authorise that organisation to co-ordinate work on the preparation of a possible Protocol on railway rolling stock. The second session of the Rail Working Group will be held in January 1998, after which it is hoped that it will be possible to submit a preliminary draft Protocol on matters specific to railway rolling stock to the Governing Council at its 77th session for information purposes with a view to its serving as the basic working text for governmental experts in their preparation of a draft Protocol on the subject.
At its second session the Registration Working Group considered those provisions of the revised draft articles of a future UNIDROIT Convention on international interests in mobile equipment resulting from the third session of the Study Group, concerned with the international registration system and the modalities of registration. It also considered those changes that would be necessary to these provisions as a result of the decision to split the future international instrument into a Convention and separate Protocols; in this connection it was noted that, to the extent that it was likely that separate Protocols would be necessary for each of the different categories of equipment to be encompassed by the future Convention, separate registries would need to be established in respect of each category of equipment and the majority of the provisions dealing with registration in respect of each such category would fall to be covered by the applicable Protocol, as supplemented by the Regulations that would need to be adopted pursuant thereto, with only a limited number of generic registration provisions appearing in the future Convention itself.
The Registration Working Group gave particular attention to the need to give a clear signal that the future international registration system was intended to be on-line, with registration and amendments thereof being able to be recorded and searched from remote locations via an electronic connection to the international registry data base, while nevertheless allowing, in the initial stages at least, for the international registration system also to be operated by non-electronic means. In respect of aircraft equipment it was agreed to provide for the use of existing national registration facilities as points of entry to the international registry data base.
II. PRELIMINARY DRAFT PROTOCOL ON MATTERS SPECIFIC TO AIRCRAFT EQUIPMENT
III. PRELIMINARY DRAFT PROTOCOL ON MATTERS SPECIFIC TO SPACE PROPERTY
IV. PRELIMINARY DRAFT PROTOCOL ON MATTERS SPECIFIC TO RAILWAY ROLLING STOCK
V. REGISTRATION WORKING GROUP: SECOND SESSION(Geneva, 26-28 May 1997)
In the context of the joint Conference of the International Bar Association Sections on Business Law and General Practice (New Delhi, 2-7 November 1997), Committee X (International Franchising) devoted a session to the Draft UNIDROIT Guide to International Master Franchise Arrangements. The session was Chaired by Ms Lena PETERS of the UNIDROIT Secretariat, who briefly introduced the Institute and its project on franchising, illustrating how the Unidroit Study Group had reached the conclusion that a Guide was the most appropriate instrument for international franchising and how participants in the IBA session might contribute to the improvement of the draft if they were interested in doing so. The panellists included members of the UNIDROIT Study Group and guest speakers from Malaysia, the Philippines and Indonesia.
The members of the UNIDROIT Study Group dealt with the following issues: what the Guide attempts to do and how it is organised (Mr Frank JESSE); whether the Guide achieves what it set out to do, whether it properly addresses the key issues and the limitations of a publication such as a Guide (Mr Alexander KONIGSBERG); the role of the Guide in the process of negotiating and drafting a master franchise agreement: its relevance for the franchisor and for the sub-franchisor (Mr Philip ZEIDMAN); the utility of the Guide to prospective sub-franchisees, notwithstanding the fact that it is primarily drafted for franchisors and sub-franchisors, and the use of the Guide by advisers and others involved with franchising (Mr John VERNON).
The Guest speakers from Malaysia (Ms CHUA Su Yin), the Philippines (Mr Tadeo F. HILADO), and Indonesia (Mr Richard L. WEISS) examined the following points: the type of economy of their countries and whether the use of the Guide might vary depending on the type of economy; whether the legal concepts dealt with are familiar to their legal cultures and/or whether they explained with sufficient clarity; whether the Guide would be useful to franchise operators or only to lawyers; whether, with the support of the Guide, the lawyers of their countries would be equipped to deal with the lawyers of the franchisors; and whether anything in particular should be added to the Guide.
The conference was well attended, with the participants expressing considerable interest in the Guide and requesting copies of the draft. It was suggested that it might be useful not only for franchise lawyers and franchise operators, but also for Government officials and for judges and arbitrators who were frequently faced with cases dealing with franchising but were regrettably unaware of the implications of a contract of this nature. The reactions of the participants in this meeting clearly show that there is a need for an instrument such as the draft UNIDROIT Guide.
I. LANGUAGE VERSIONS
The interest evinced in the UNIDROIT Principles worldwide is nowhere more evident than in their translation into an ever-growing number of languages. Certainly, a text in the vernacular is a great advantage in ensuring the widest possible distribution to legal scholars and market operators and in fostering both understanding of the text and the ways in which it may be applied in given circumstances.
The integral version of the UNIDROIT Principles is now available in the following languages: Chinese, Czech, Dutch, English,* French,* Italian,* Russian, Slovak and Spanish.* The black letter rules have now been translated into Arabic, Bulgarian, Croatian, German, Hungarian, Japanese and Portuguese.
II. COLOMBIAN JUSTICE MINISTRY DECIDES WIDESPREAD DISTRIBUTION OF UNIDROIT PRINCIPLES
An integral version of the UNIDROIT Principles, reproducing the Spanish-language text prepared by UNIDROIT in 1995, has just been published in Colombia, on the initiative of the Colombian Ministry of Justice and Law (Department of International Affairs) and with official authorisation from UNIDROIT (ISBN 88-86449-03-8, August 1997).
The introduction to the new volume consists of a brief presentation of the Principles by the Minister of Justice, Almabeatriz RENGIFO LÓPEZ, and an article by Professor Fernando HINESTROSA, Dean of the Universidad Externado de Colombia (and a correspondent of UNIDROIT), entitled "The Unidroit Principles: a new ‘lingua franca’ ", which stresses in particular that "the Principles offer a workable synthesis between, on the one hand, the wisdom and ethics handed down through the millennia and, on the other hand, a spirit of innovation, the better to address the problems arising out of international contractual relations according to criteria which reflect the reasoning, conduct and needs of contemporary operators."
The Colombian initiative, which forms part of the country’s "Blueprint for the harmonisation of private international law" launched to ease the adoption of uniform law texts and to improve the study and knowledge of non-binding legal instruments such as the UNIDROIT Principles, is particularly welcome since it reproduces and amplifies, at the national level, the efforts deployed by UNIDROIT to make the Principles known worldwide. As the Minister pointed out in her opening remarks, the wholesale distribution of the volume to a broad range of potential users including jurists and lawyers, universities, barristers, businessmen and chambers of commerce, cannot fail to bring the Principles the publicity they deserve and to trigger the debate on their application, thereby opening up to parties the opportunity of choosing them as the law applicable to their contract. The existence of clear and stable rules for the negotiation of contracts will be a powerful aid to improving the predictability of the medium and long-term business and investment environment.
The 1983 Geneva Convention on Agency in the International Sale of Goods – a model for the new OHADA regulation on agency
The 1983 Geneva Convention on Agency in the International Sale of Goods, which was adopted after long and arduous negotiations, is still not in force,4 partly because of the extraordinarily high number (ten) of ratifications required. Nevertheless, its intrinsic qualities are such that it continues indirectly to influence the law on agency at international level.
The latest illustration of this is the recent Acte uniforme portant sur le droit commercial général, approved by the Organisation for the Harmonisation of Business Law in Africa (OHADA) 5 on 17 April 1997. The Acte is a fully-fledged commercial code covering, in five parts, a vast area ranging from basic concepts (such as the definition of commerçant and acte de commerce) to specific transactions, such as sales contract. Part IV regulates intermediary relationships in commercial transactions (Les intermédiaires de commerce) and is subdivided into four titles: the first is devoted to common provisions, while the other three deal with the different kinds of agents familiar in the civil law tradition: the commission agent (commissionnaire) and the broker (courtier), in addition to the independent commercial agent (agent commercial).
The 1983 Geneva Convention on Agency clearly served as a basis for the preparation of the general part of the instrument which deals with so-called "external" agency (the relationship between the principal or the agent on the one hand and the third party on the other). Following the solution adopted by the Convention, the new OHADA rules apply irrespective of whether the agent acts in the principal’s name or, though on behalf of the principal, in his own name, i.e. whether he would be considered under the civil law approach as a représentant or as a commissionnaire. The uniform rules mirror the Convention’s philosophy also on points of detail (establishment and scope of the agent’s authority; legal effects of acts performed by the agent, termination of the authority of the agent).
It is worth mentioning that the new uniform rules expressly provide that they apply even where the principal or the third party have their place of business in a State different from those adopting the new uniform rules, provided that the agent has his place of business in one of the adhering States or that the rules of private international law lead to the application of the law of one of these latter States.
In response to overtures by the President of the Central American Parliament,6 Mr Ernesto LIMA MENA, a regional seminar entitled "International Law and Central American Integration" was organised in Guatemala on 6 October 1997 under the joint auspices of the Central American Parliament, UNIDROIT and the Guatemalan College of Solicitors and Notaries Public.
Mr W. RODINÒ, acting Secretary General of Unidroit, and Ms M. SCHNEIDER of the UNIDROIT Secretariat presented the UNIDROIT Principles of International Commercial Contracts and the UNIDROIT Convention on Stolen or Illicitly Exported Cultural Objects. Two of the Institute’s correspondents in the region then took the floor: Mr Alfonso ORTIZ SOBALVARRO (Guatemala), who took an active part in preparing the seminar, highlighted the potential impact of the UNIDROIT Convention in Central America, while Mr Gilberto BOUTIN (Panama) reported on regional aspects of the unification of transport law with special emphasis on maritime law. Mr Alfonso NOVALES AGUIRRE, President of the Guatemalan College of Solicitors and Notaries Public, considered air transport.
A co-operation agreement between the two institutions was concluded at the close of the seminar, providing for collaboration in areas of activity and projects of mutual interest in connection with the unification of private law and regional integration in Central America. The establishment of formal co-operation links with PARLACEN should be instrumental in acquainting its member States with UNIDROIT and possibly pave the way for these countries to become members of the Institute. A number of specific areas have been earmarked for co-operation, one in particular being of particular interest to this region: the harmonisation of road transport law.
Determined to keep up with the fast-expanding global information technology – Internet in particular – which offers such a wealth of new opportunity to legal scholars and practitioners, UNIDROIT launched a comprehensive computerisation programme in the summer of 1997. The main thrust of the scheme is a thorough overhaul of the Institute’s computer stock, including the introduction of an internal on-line facility the better to co-ordinate its day-to-day activities, and the computerisation of the UNIDROIT Library – starting with its Catalogue. There are also plans to develop an up-to-date documentation centre, to launch a series of pilot studies on uniform law data bases and to flesh out the UNIDROIT Internet site.
These improvements should be of immense practical benefit to researchers, including the Institute’s research scholars from developing countries and countries in economic transition. Generally speaking, the benefits to an organisation such as UNIDROIT of electronic document transfer, sophisticated search engines in the legal sphere and easy access to all manner of information worldwide can hardly be overstated.
The Library Catalogue currently lists over two hundred and thirty thousand entries in urgent need of revision and computerisation. Following a series of trial runs, the Library has now opted for reliable, fast and user-friendly software featuring easy access to the Internet and offering full scope for the future development of national and international co-operation links. The decision has in the meantime been taken to seek external sponsorship for the Catalogue.
While the Internet boom has undisputedly meant a tremendous increase in the amount of universally accessible information, in practice Internet-surfers often find the search process frustrating and time-consuming and end up turning to more traditional sources of information. It was with this phenomenon in mind that the virtual library was created, in the form of easy-to-use links to reliable, up-do-date sites offering an abundance of legal texts: legislation, case law, scholarly writings, and so forth. This facility will shortly be accessible free of charge through the UNIDROIT Internet home page. Contributions in the form of information about top-quality scientific sites for inclusion in the virtual library will be most welcome at all times.
Since an in-depth knowledge of the various national laws is indispensable to the unification of law, various schemes are now underway to collect and analyse the relevant data for inclusion in appropriate data bases. UNIDROIT has its own plans for a data base on uniform law, "Unilaw" 7 – a prototype of which is currently under construction – which will deal with financial law, transport law and cultural property law.
UNIDROIT is fully committed to making the new technology work for the Institute, in the interests both of efficiency and transparency, and in order to ensure that its seventy years’ experience covering all aspects of the unification of law continues to serve the purposes of tomorrow’s world.
The following scholars spent a research period at the Institute in the third quarter of 1997:
Mr Antenor MADRUGA, Professor of Commercial Law at the University of Rio Grande do Norte and an Advocate of the Union (Brazil), is spending the period August 1997 – January 1998 at UNIDROIT to carry out advanced research in the field of commercial agency. His work is financed by the Sasakawa Foundation (Tokyo), with part-funding from UNIDROIT’s legal co-operation budget.
Mr Diman IVANOV, Assistant Professor at the University of Plovdiv (Bulgaria), conducted research on the UNIDROIT Convention on Stolen or Illicitly Exported Cultural Objects in September. His grant, financed by the Council of Europe, was so structured as to enable him to couple his stay at UNIDROIT with a research period at the Hague Conference of International Private Law (three weeks in June), where he studied the Convention now under preparation on jurisdiction, recognition and enforcement of judgments.
Mr Jacek NAPIERALA, Professor at the University of Poznan (Poland), spent the month of September at UNIDROIT researching the Vienna Convention on Contracts for the International Sale of Goods, concentrating on liability out of contract. His research was funded by the Council of Europe.
M. Mauricio PRADO, Solicitor, São Paolo (Brazil), was at the Institute (September-November) for two and a half months to conduct research on hardship in contract law, with particular emphasis on the approach embodied in the UNIDROIT Principles and the European Principles of Contract Law. His grant was financed by the French Government.
1See UNIDROIT News, ULR 1997-2, p. 308 et seq. for a presentation of the state of implementation of the work preceding the stage which is here described, and in particular the decision to split the future international instrument into a base Convention setting forth general rules universally applicable to all the different categories of equipment falling within its sphere of application, on the one hand, and one or more equipment-specific Protocols containing such additional rules as might be necessary to adapt the general rules of the future Convention to the special financing patterns of specific categories of equipment, on the other hand. [Back to text]
2 The Study Group was set up by the Unidroit Governing Council in 1992, and held four sessions between 1993 and 1997 under the chairmanship of Professor Roy M. GOODE, United Kingdom member of the Governing Council. [Back to text]
3 Co-ordinator of the Aviation Working Group and expert consultant to the Study Group on international aviation finance matters. [Back to text]
* The versions marked with an asterisk are published by Unidroit and may be ordered from the Secretariat. [Back to text]
4 The 1983 Geneva Convention has to date been ratified by France, Italy, Mexico, the Netherlands and South Africa.[Back to text]
5 OHADA is a supranational organisation created in 1993 by a group of mostly French-speaking African countries (in May 1997 membership stood at 16: Benin, Burkina Faso, Cameroon, the Central African Republic, Chad, the Comoros, Congo, Côte d’Ivoire, Gabon, Equatorial Guinea, Guinea, Guinea-Bissau, Mali, Niger, Senegal, and Togo) with the objective of improving the legal framework for the business community through the unification of law. The three uniform acts adopted in April 1997 will enter into force on 1 January 1998.[Back to text]
6 PARLACEN is made up of representatives of Guatemala, El Salvador, Nicaragua, Honduras and Panama. Costa Rica and the Dominican Republic are about to become members.[Back to text]
7See L. PETERS, "Unidroit takes the Challenges of the Twenty-first Century: the Uniform Law Foundation and the Data Base on Uniform Law", ULR 1997-1, 58.[Back to text]