01-4667. Proposed Convention Sponsored by UNIDROIT on International Equipment Finance and Draft Protocol on Space Equipment; Meeting Notice

ACTION:

The Space Finance Study Group of the State Department's Advisory Committee on Private International Law will meet in Washington, DC on Thursday, March 8 from 10:00 a.m. to 4:00 p.m. The Study Group will review and comment on a draft protocol on space equipment which would amend provisions of a proposed UNIDROIT convention on international secured financing for high-value mobile equipment, with a particular focus on the space equipment industry and implications for the provision of space-based services.

Agenda

The meeting will cover the status and purposes of the proposed (UNIDROIT) Convention on international interests in mobile equipment; the application of asset-based financing to space equipment; the revised draft protocol on space equipment; the revised draft protocol on aircraft; the upcoming meeting on the space protocol and the relationship to the outer space treaty system at the Legal Subcommittee of the United Nations Committee on the Peaceful Uses of Outer Space (UNCOPUOS); and related developments in the space industry.

The intersection with the Uniform Commercial Code in the United States and secured finance laws in other countries will be considered, as well as related developments on international secured financing at UNCITRAL (the United Nations Commission on International Trade Law) and the OAS (Organization of American States).

The relationship between the proposed Space Equipment Protocol and the outer space treaty system will be reviewed, with particular attention to provisions on control and liability. In addition, options for establishment of an international computer-based registry of financial interests as contemplated by the new treaty system, and its relationship, if any, to the existing registration of space objects at UNCOPUOS, will be examined.

Background

The United States is a member of UNIDROIT (The International Institute for the Unification of Private Law) and has been an active participant in negotiations on a proposed multilateral convention (UNIDROIT Convention) to provide for the creation and enforceability of international secured finance interests in mobile equipment, specifically including at this stage aircraft, to be followed by space and satellite equipment, and railway rolling stock. A Space Working Group (SWG) authorized by UNIDROIT has prepared the current draft protocol on provisions specific to space equipment financing. Completion of the basic Convention and Aircraft Protocol is expected by the fall of 2001.

Completion of protocols on space and rail equipment is expected to follow. The proposed Convention and equipment specific protocols can enhance the development of equipment industries, as well as the capacity of many countries to finance such equipment and related services, through private sector capital markets.

Key features of the draft Convention include the creation of internationally enforceable financing interests; establishment of an international computer-based registry system for notice and priority of finance interests; and optional provisions on key issues such as certain expedited remedies, insolvency, etc. The convention and space protocol would not amend any provisions of the space treaty system, nor affect the existing object registry functions of UNCOPUOS.

Attendance

The meeting will be held at the International Law Institute (ILI) in Washington, D.C., 1615 New Hampshire Avenue, N.W. The meeting is open to the public, subject to rulings of the Chair. Persons wishing to attend should contact Harold Burman, Office of Legal Adviser (L/PIL), at 202-776-8421, fax [phone], email [e-mail], or Kenneth Hodgkins, Office of Space and Advanced Technology, (OES/SAT), 202-663-2398, fax [phone], email [e-mail], by Monday, March 5.

Documents

A revised draft space protocol, prepared by the Space Working Group, and a joint report by the Secretariats of UNCOPUOS and UNIDROIT are available in United Nations (UNCOPUOS) document A/AC.105/C.2/L.225, dated Jan. 22, 2001, which also contains a revised draft of the base convention. The base convention is also available at www.UNIDROIT.org. Commentators unable to obtain a timely copy of the space protocol through UN document repositories can request one from the Office of Legal Adviser, by contacting Rosie Gonzales at 202-776-8420, fax [phone], or by email at [e-mail]. Persons unable to attend the meeting can provide comments at any of the above contact points.

Harold S. Burman,

Executive Director, Secretary of State's Advisory Committee on Private International Law, U.S. Department of State.