Secured Credit and the Harmonisation of Law

Secured Credit and the Harmonisation of Law

The UNCITRAL Experience

Corporations, Globalisation and the Law series

Gerard McCormack

This is a discerning analysis of international harmonisation efforts for secured credit law and examines the role of globalisation and finance capital in shaping such efforts. Gerard McCormack reveals how an ‘efficient’ law is often seen to increase the availability, and lower the cost, of credit, thereby contributing to international development. He considers whether the most comprehensive international standard – the United Nations Commission on International Trade Law (UNCITRAL) Legislative Guide (2008) – is actually suitable for adoption at the national level. In particular, he examines the hypothesis that American law and lawyers have shaped the content of the Guide to the extent that it is not suitable for translation into other laws.

Chapter 5: International Harmonisation Efforts Before the UNCITRAL Legislative Guide

Gerard McCormack

Subjects: law - academic, commercial law, company and insolvency law, corporate law and governance, finance and banking law, international commercial law

Extract

UNCITRAL’s efforts to promote harmonisation in the sphere of secured transactions have been preceded by other international initiatives both at the global and at the regional level. This chapter will assess previous harmonisation efforts and set them against the background of the UNCITRAL Legislative Guide. The focus will be on two particular instruments – the European Bank for Reconstruction and Development (EBRD) Model Law on Secured Transactions and the Organisation of American States (OAS) Model Law. These are both general instruments applying in principle to all types of collateral and can be considered as precursors of the Legislative Guide, but before considering the two instruments in detail it is useful to address the issue of global versus regional harmonisation as well as touching upon the merits of collateral-specific instruments. LAYERS OF HARMONISATION Loukas Mistelis has spoken of at least two competing strategies in the harmonisation of international commercial law on a worldwide basis: firstly, the global conventions/model laws etc. proposed by international organisations and secondly, the regional agreements drafted by regional organisations. ‘The goals of such regional conventions may derive from quite different motivations, but often they produce agreements that concern the same subject matter as the global conventions.’1 Others such as Spiros Bazinas, Senior Legal Officer at UNCITRAL, see global and regional harmonisation as more complementary than competitive processes. In his view, regional harmonisation promotes regional 1 L Mistelis ‘Regulatory Aspects: Globalization, Harmonization, Legal Transplants and Law Reform – Some Fundamental Observations’ (2000) 34 International Lawyer 1055 at 1062–1063. 102...

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