Activities and Priorities of Dept. Justice in Private International Law 2003




a. Convention on the Settlement of Investment Disputes (ICSID) (World Bank)

[38] - Subject: This Convention, drafted by the World Bank in 1965, sets up voluntary arbitration mechanisms between States and nationals of other States for investments made by corporations or individuals in foreign countries. The Convention creates an international organisation, the International Centre for Settlement of Investment Disputes (ICSID), which provides facilities for conciliation and arbitration of investment disputes between Contracting States and nationals of other Contracting States.

[39] Although 139 States are party to the Convention, Canada has not yet ratified it. This may be explained in part by the fact that the Convention does not contain a federal state clause. The federal government has been working to obtain the agreement of all provinces and territories to implement the Convention. Uniform adoption of implementing legislation would allow Canada to ratify it. The project has received the support of eight provinces and two territories. Consultations with the two remaining provinces (Quebec and Alberta) are taking place. Nunavut will also be consulted. A uniform act for the implementation of the Convention for the Settlement of International Investment Disputes Act, was adopted unanimously by the ULCC on November 30, 1997.

[40] - Action required in Canada: Complete consultations with the provinces and territories, sign the Convention, enact implementing legislation, and ratify the Convention.

b. Conventions on the Limitation Period in the International Sale of Goods (UNCITRAL)

[41] - Subject: These Conventions, which entered into force August 1, 1988, grew out of the work of UNCITRAL to unify international sales law. On July 1, 2003, there were 24 States party to the Limitation Convention of 1974, and 17 States party to the Amended Limitation Convention, including, in both cases, our North-American trade partners, the United States and Mexico.

[42] The Conventions dovetail with the United Nations Convention on Contracts for the International Sale of Goods (Vienna, 1980), which has entered into force for all of Canada in January 1993. A declaration was recently made with regard to Nunavut. There is substantial similarity between the three Conventions, in particular the articles setting out the sphere of application, declarations and reservations, the federal State clause, and the final clauses.

[43] The purpose of the Limitation Conventions is to eliminate all disparities in the national laws governing limitations on the initiation of legal proceedings arising from contracts for the international sale of goods, as these disparities can create hardship both in cases where meritorious claims are statute-barred by a very short limitation period, and where parties are left open to liability for an inordinately long time in jurisdictions with very long limitation periods. The Conventions establish a uniform prescription period of four years for commercial litigation.

[44] In 1995, the Advisory Group on Private International Law recommended that the Department take steps toward acceding to and implementing the Conventions. In August 1998, the Uniform Law Conference of Canada adopted the Uniform International Sales Conventions Act. This Act would implement the United Nations Convention on Contracts for the International Sale of Goods, already in force in Canada, and the Conventions on the Limitation Period in the International Sale of Goods.

[45] The Minister of Justice of Canada has undertaken consultations with his provincial and territorial counterparts on the desirability of implementing the Limitation Conventions. Some provinces have already expressed support for the implementation and Nunavut has already enacted the International Sales Conventions Act, which received assent on June 6, 2003.

[46] Action required in Canada: the federal government will be considering the adoption of federal implementing legislation on the Limitation Conventions, which would apply to contracts for the sales of goods involving the Crown in right of Canada. Once enacted, the federal implementing legislation, and in particular the schedules, could be adopted by reference by provinces and territories.

c. Convention on International Interests in Mobile Equipment (UNIDROIT)

[47] - Subject: This Convention, not yet in force, provides a framework for the creation and effects of an international interest in mobile equipment (i.e., aircraft equipment, registered ships, oil rigs, containers, railway rolling stock, space property, and other objects that could be identified in the future). Each type of mobile equipment would be the subject of a specific Protocol under the Convention.

[48] The Convention is concerned with three types of international interest:

(1) those granted under a security agreement;

(2) those held under a title reservation agreement; and,

(3) those vested in a person who was lessor under a leasing agreement.

[49] In summary, the Convention:

(1) sets formal requirements for the creation of an international interest;

(2) sets out basic default remedies;

(3) establishes registration rules;

(4) deals with the effect of an international interest as against third parties (priority rules, rules to preserve the efficacy in the event of bankruptcy);

(5) contains provisions on assignments; and,

(6) deals with registrable national interests.

Aircraft Protocol

[50] The Aircraft Protocol, not yet in force, adapts to aircraft equipment the mechanisms set out in the Convention. Among other things, it will set an international central registry to register interests in aircraft equipment.

[51] The 2001 Diplomatic Conference in Cape Town resulted in the adoption of the Convention on International Interests in Mobile Equipment and its Related Aircraft Equipment Protocol. The texts of the Convention, Protocol and a consolidated version can be found at the Internet address of Unidroit. (

[52] The following steps have been or will be undertaken in order to advance the setting up of the International Registry and preparation for the signature and implementation of the Convention and Aircraft Protocol in Canada.

- International Registry

[53] The international registry is an important part of the Convention and Protocol. It will enable registration of convention-based international security interests in aircraft equipment, and will facilitate searches. Canada, given its role in international civil aviation and its expertise in electronic registries, has announced an interest in hosting the registry. Ireland and Singapore have also done so.

[54] Canada is among 20 states appointed to an ICAO-guided preparatory commission that will govern the bidding process for candidates wishing to operate the registry. The bidding process will begin once ICAO obtains the necessary funding. Interested states will then submit candidatures. Steps to put forward a Canadian candidate to operate the registry are being taken by Quebec in co-ordination with the Departments of Industry, Foreign Affairs and Transport. Early signature of the Convention and Protocol by Canada will more than likely be considered a prerequisite for bidding.

- Signature of the texts

[55] In order to be well placed as a candidate to host the International Registry and after having received substantial support from provincial authorities, necessary arrangements are being made at the federal level to be able to sign the instruments as soon as possible to show our interest.

- Update of the ULCC Uniform Act

[56] The ULCC Working Group on International Interests modified the version of the Uniform Act and its related Report that was submitted at the ULCC Annual Meeting in August 2001 in order to adapt them to the final wording and substance of the Convention and Aircraft Protocol as they were adopted at the Diplomatic Conference.

[57] The Uniform Act was officially adopted by the ULCC in May 2002 and a copy was sent to ULCC members for information and follow-up.

- Implementation of the instruments in Canada

[58] Canadian jurisdictions will be asked to consider adopting legislation to implement the Convention and Aircraft Protocol.

- Ratification of the Convention and Protocol

[59] When sufficient support for ratification will have been demonstrated by the adoption of implementing legislation, the federal government will seek authority to ratify the Convention and Protocol, with the relevant declarations in order for the instruments to apply in the jurisdictions that so wish, with as well as other important declarations related to preserving the status quo of existing rights. Recently, in order to facilitate the process of drafting declarations and as decided by the ULCC working group, the federal government requested information from provinces and territories on existing non consensual interests in their jurisdictions. Responses have been received from Québec, British Columbia and Yukon.

[60] - Action required in Canada: Continue with the appropriate steps for Canada to sign the instruments and continue positioning itself as a possible host for the International Registry; reaffirm the support of the provinces and territories and invite them to consider adopting legislation to implement the instruments; continue work to facilitate the drafting of declarations.

d. Working Group on Arbitration (UNCITRAL)

[61] -Subject: In 1999, the Commission mandated the Working Group on Arbitration to examine four subjects: 1) conciliation, 2) requirement of written form for the arbitration agreement, 3) enforceability of interim measures of protection, and possibly 4) enforceability of an award that had been set-aside in the State of origin.

[62] To date, the Working Group has only examined the first 3 subjects. The Model Law on International Commercial Conciliation was adopted in June 2002. Once work on interim awards is completed, the Working Group will resume its work on the written form of the arbitration agreement.

[63] Enforceability of Interim Awards: The Working Group continued its discussions on harmonized texts on the enforcement of interim measures at the October 2002 and May 2003 meetings. The Canadian delegation comprises Manon Dostie (federal Department of Justice), Professor Guy Lefebvre (civil law expert) and Robert Cosman (common law expert).

[64] Further to the completion of instruments on all three subjects noted above, the ULCC will be requested to consider convening a Working Group to draft implementing legislation. The Reports of the Working Group on Arbitration and background documents are available on the UNCITRAL web site <>.

[65] - Action required in Canada: Consult with FPT governments, private sector, dispute resolution organisations and other interested parties in preparation for the next Working Group session.

e. Working Group on Electronic Commerce (UNCITRAL)

[66] - Subject: The Working Group on Electronic Commerce continues to have on its agenda a possible instrument on electronic contracting as a means of increasing legal certainty or commercial predictability in electronic business transactions. The Working Group has not agreed on the scope of the instrument (for example, the instrument may deal with the formation of contracts for sale of goods only, or of most or all other types of contracts). Once the scope and thrust of the uniform text has been considered, the Working Group will be in a better position to make a decision on the form of the instrument.

[67] In June 2002 at its 35th session, the Commission reviewed the reports of the Working Group and considered concerns that had been raised as to the appropriateness of proceeding with work on electronic contracting in light of the many obstacles to electronic commerce in existing conventions and the need to deal with them. As a result, the Commission then opted to change the focus of the Working Group's mandate so that at its 40th Session in Vienna in October 2002, the Working Group concentrated on existing multilateral treaty regimes and their possible amendment to facilitate the increased use of electronic commerce. Details on the possible scope of treaties to be considered are contained in the Annex to A/CN.9/WG.IV/WP.94 on the UNCITRAL website. The Commission and Working Group subsequently returned to issues of electronic contracting.

[68] The focus of the 41st Session of the Working Group, May 2003, in New York City, was on a draft convention on electronic contracting prepared by the Secretariat. The most current version of the draft can be found at

[69] Just prior to the last Session, a consultation (ULCC Ecom distribution list) was launched in order to obtain comments on the Secretariat's draft. Comments would be considered in determining the Canadian position on the following key questions:

1. Should the convention be limited to sales of goods contracts (like the UN Convention on Contracts for the International Sales of Goods) or should it apply to all electronic contracts in respect of their formation as well as to their administration or execution?

2. Should the convention explicitly exclude consumer transactions?

3. Should a state be able to exclude specific transactions from the application of the convention?

4. Should parties to a transaction be able to opt out of certain provisions of the convention?

5. Is the provision proposed in Article 11 for time of receipt acceptable as a rule or should it be only a presumption, given the uncertainties of email delivery?

6. Of the two variants proposed for Article 9, which variant is preferable for an apparent offer in an automated system?

7. What should the consequences to a party be for that party's failure to provide the information set out in Article 15?

[70] A discussion paper was prepared by John Gregory, General Counsel, Ministry of the Attorney General for Ontario, raising narrower issues with recommendations for the Canadian delegation.

[71] At the 41st Session, the debate centred mostly on issues of scope, exclusions, location of the parties, and a technical discussion on issues surrounding dispatch and reception of data messages.

[72] A report by the Secretariat of the 41st Session is available at

[73] A new version of the draft Convention is being prepared by the Secretariat for the next Session in November in Vienna.

[74] - Action required in Canada:

Continued consultation with provinces, territories, stakeholders and experts for consideration in determining Canadian positions on various outstanding issues. Review of the secretariat's revised draft.

f. Working Group on Security Interests (UNCITRAL)

[75] - Subject: In July 2001 at its 34th session, UNCITRAL mandated a Working Group to begin developing a uniform legal regime for security rights in tangible goods of a commercial nature. The work is to include the form of the security instrument, the scope of goods that can serve as collateral, perfection, formalities, enforcement, publicity, priority, and creditors' and debtors' rights.

[76] The UNCITRAL work on security interests was initiated because it was felt that modern secured credit laws could alleviate inequalities in access to lower-cost credit between parties in developed countries and parties in developing countries, which would overall contribute to foster international trade. It was also widely recognised that an appropriate balance needed to be struck in the treatment of privileged, secured and unsecured creditors. States agreed that a flexible approach aimed at the preparation of a set of principles in a guide, rather than a model law, would be advisable. Furthermore, given the close link between security interests and the work on insolvency, countries recognised that any effort on security interests would need to be co-ordinated with efforts on insolvency law.

[77] In the fall 2001, the UNCITRAL Secretariat invited experts from several States, including Canada, to assist with the preparation of a draft legislative guide, which constituted the working document for the first session of Working Group VI on the subject. Me Michel Deschamps of McCarthy Tétrault in Montreal and Professors Catherine Walsh and Roderick Macdonald of McGill University collaborated on the draft text with experts from other States. Since then, three meetings have been held and work is progressing. However, it is not expected to conclude before the fall of 2004.

[78] One issue that appears to have been resolved is the orientation of the draft guide toward a public notice-filing registry, which had been strongly opposed by representatives of one State. Other countries had also expressed some reservations. Many delegations, however, remain with fundamental questions about the costs and operation of a registry system as well as questions about the legal framework. Some key countries will be compelled to support a non-registry approach if they are not reassured with respect to their questions.

[79] From a Canadian perspective, the government monitors the trends the global model is taking with the view of ensuring that it does not take a direction that is not inconsistent with our security interests regimes here in Canada. Although the draft Guide would not be particularly useful for Canadian jurisdictions given that our legal framework for secured interest is already relatively modern, our aim is to ensure that countries where Canadians do business have similar regimes.

[80] The next meeting of the Working Group takes place in Vienna from September 8-12, 2003. Canada chairs the sessions of the Working Group.

[81] - Action required in Canada: Distribute Working Papers for comments. Consult with officials from provincial/territorial registries.


a. Convention on the Assignment of Receivables (UNCITRAL)

[82] - Subject: In July 2001 UNCITRAL adopted the Convention on the Assignment of Receivables in International Trade after six years of development. The Convention was opened for signature in December 2001. The rules are intended to facilitate financing by removing uncertainty encountered in various legal systems as to recognition and effects of assignments in which the assignor, the assignee and the debtor are not in the same country. Canada was an active participant in the development of this Convention.

[83] In May 2003, consultations were undertaken with lawyers in the private sector, in order to understand their degree of knowledge and interest in the Canadian ratification and implementation, of this convention and the two Unidroit conventions on international factoring and international leasing.

[84] - Action required in Canada: Consult with the private sector, federal, provincial and territorial authorities on implementation, have preliminary implementation study done, and request the ULCC to prepare uniform implementing legislation as part of the Commercial Law Strategy.

b. Convention on securities held by intermediaries (Hague Conference)

[85] Subject: Canada actively participated in the negotiations of the Hague Convention on the Law Applicable to Certain Rights in Respect of Securities Held with an Intermediary. The Convention was finalized and adopted during the Diplomatic Session held from December 2 to 12, 2002 in The Hague.

[86] This Convention is a first attempt worldwide to draft cross border rules on the law applicable to securities held with an intermediary. The objective is to enable financial market participants in the global market to ascertain readily and unequivocally which law will govern the proprietary aspects of transfers and pledges of interests in respect of securities held through indirect holding systems. This Convention is intended to provide certainty and predictability on a limited but crucial aspect of such transactions.

[87] The Canadian delegation included Manon Dostie from the PIL Team at the federal Department of Justice, two practitioners: Brad Crawford (common law expert) and Michel Brunet (civil law expert), and two experts from the Canadian securities commissions: Eric Spink (Alberta) and Daniel Laurion (from Québec, absent at the last meeting). Maxime Paré from the Ontario Securities Commission participated as a representative of IOSCO and represented Canada on the Drafting Group leading up to the Diplomatic Conference.

[88] The Permanent Bureau is working with experts to draft the Explanatory Report to the Convention.

[89] Action required in Canada: Request ULCC to prepare uniform implementing legislation as part of the Commercial Law Strategy; continue to consult the delegation on the draft Explanatory Report.


a. Convention on Independent Guarantees and Stand-by Letters of Credit (UNCITRAL)

[90] - Subject: This Convention was finalised in 1995 and is not yet in force. It aims to establish greater uniformity in the law relating to independent guarantees and stand-by letters of credit in international transactions.

[91] - Action required in Canada: Consultation on signature and ratification and study of implementation mechanisms.

b. Convention on Contracts for the International Sale of Goods (UNCITRAL)

[92] - Subject: The Sale Convention establishes uniform rules for the international sale of goods, which apply in the absence of any expression to the contrary by the parties to the sales contract. While the Convention applies to contracts for the sale of goods, it excludes the sale of goods for personal use, sale by auction, judicial sales, and the sale of stocks, ships, aircraft or electricity. The provisions of the Convention deal with the formation of the contract and the rights and obligations of the seller and buyer. The Convention does not govern the validity of the contract or its terms, nor does it deal with the seller's liability outside the contract.

[93] The Convention came into force for Canada on May 1, 1992, and applies uniformly across all of Canada since February 1, 1993. A declaration was recently made with regard to Nunavut.

[94] The ULCC has recommended that the Sale Convention be amalgamated with other conventions on the international sale of goods. To that end, it has proposed in 1998 the Uniform International Sales Conventions Act.

[95] As of July 1 2003, 62 States are party to the Convention.

[96] - Action required in Canada: Consideration to adopting the Uniform International Sales Conventions Act should be given. Nunavut adopted the Uniform Act in 2003.

c. Convention on International Bills of Exchange and International Promissory Notes (UNCITRAL)

[97] - Subject: This Convention, which was finalised in 1988, is not yet in force. Canada, which actively participated in its drafting, the Russian Federation and the United States have signed it; Mexico and Guinea have acceded to it. The Convention will enter into force after ten ratifications or accessions. In order to implement it in Canada, federal legislation would be required.

[98] The UNCITRAL Secretariat has prepared a draft Protocol that would bring the Convention into force among NAFTA countries, with provision for additional State parties as required. The objective of this Protocol would be to encourage other States to ratify the Convention and to provide the benefit a uniform set of rules for at least one group of States without having to wait for 10 ratifications.

[99] The Convention is the result of nearly 20 years of work by UNCITRAL to devise a unifying law for international bills and notes. It will create a new international regime based on a compromise between the civil and common law traditions. It addresses and regulates a number of complex and difficult issues such as the rights of a holder of a bill or note; forged endorsements; fraud, theft; guarantors; presentment for payment and non-acceptance; notice of dishonour and discharge. When the Convention comes into force, it will therefore introduce more predictability for financial institutions and businesses that use these methods of payment for international transactions.

[100] In late 2000, the Department of Foreign Affairs was consulted on the feasibility of a Protocol between NAFTA parties to bring the Convention into force among them. In March 2001, the United States was consulted to determine whether they are interested in such an arrangement, but to date we have not received a response.

[101] - Action required in Canada: Consultation on the proposed Protocol both domestically and with Mexico. If our NAFTA partners demonstrate their intention to proceed and if interested parties in Canada agree, federal implementing legislation could be drafted and ratification of the Convention and signature and ratification of the Protocol could proceed.

d. Inter-American Convention on the Law Applicable to International Contracts (OAS)

[102] - Subject: This Convention, which was finalised under the auspices of (CIDIP-V) in Mexico in 1994, has entered into force with the ratification of two States: Mexico and Venezuela. Bolivia, Brazil and Uruguay are signatories. It provides for the recognition of the parties' choice of law applicable to an international contract, a rule which is in general conformity with the existing rules both in common law and civil law regimes in Canada. The Convention also establishes subsidiary rules for determination of the law applicable.

[103] When members of the Department of Justice's Advisory Group on Private International Law reviewed the Convention, the members were of the view that without improvement in the English version in particular, there would not be sufficient support in Canada for signature and ratification.

[104] When the Convention was discussed at the preparatory meeting to CIDIP-VI in December 1998, it was agreed that those States interested in changing the text should bear the responsibility of proposing changes. It was agreed that a proposal for changes would be submitted to the Secretariat which would then circulate it to the States which had signed and ratified the Convention in order to obtain their agreement to a revised text.

[104] Canada is still not party to any of the CIDIP conventions, a situation which does not go unnoticed by other Member States. Given the substantial compatibility of the Convention with Canadian law, Canada could feasibly consider accession to it if the language problems were satisfactorily resolved.

[105] - Action required in Canada: Consult with provincial and territorial authorities and other interested parties on proposed changes to the English and French versions of the Convention. Arrive at an agreed proposal with other concerned States to be submitted to the OAS Secretariat for distribution to interested States.

e. Model Law on Cross-border Insolvency (UNCITRAL)

[106] - Subject: Trans- or cross-border insolvency exists where the insolvent debtor has assets in more than one jurisdiction. In many cases, administrators are not able to deal effectively with the assets because of the great differences in insolvency legislation from one State to another and because of a lack of procedures to allow cross-border co-ordination of insolvency proceedings.

[107] In 1995, UNCITRAL decided to address the issue and attempt to propose solutions to the practical problems caused by the lack of harmony among national laws on cross-border insolvency, notwithstanding the failure of other international organisations to achieve results. In collaboration with INSOL, an international association of insolvency practitioners, the Working Group on Insolvency Law prepared a legislative framework for judicial co-operation and for access and recognition in cross-border insolvency. The Model Law on Cross-Border Insolvency was finished at the 30th Session of the Commission in May 1997. Since then, Eritrea, Japan, Mexico, the United Kingdom and South Africa have enacted the Model Law. Other States, including Australia, New Zealand and the United States are considering its adoption.

[108] Industry Canada is including consideration of the Model Law in its reform consultations and the Senate Standing Committee on Banking, Trade and Commerce reviews the administration and operation of the Bankruptcy and Insolvency Act.

f. Case Law on UNCITRAL Texts (CLOUT)

[109] - Subject: UNCITRAL has established a system for collecting and distributing judicial and arbitral decisions on the New York Convention, the Model Law on International Commercial Arbitration, the Sales Convention and other UNCITRAL instruments in force. Designated national correspondents contribute summaries of the decisions. Cases which interpret, for example, the Sale of Goods Convention, can be found at the UNCITRAL web site. The first Canadian decision on the Sale of Goods Convention was rendered in August 1999: La San Giusseppe v. Forti Moulding Ltd., (1999) O.J. No. 3352.

[110] Professor Geneviève Saumier from the Faculty of Law of McGill University is the Canadian National Correspondent for CLOUT, for both civil and common law cases.

[111] - Action required in Canada: Support the work of the national correspondent; distribute collections of decisions as they are received; attend annual meetings of national correspondents.

g. Working Group on Insolvency Law (UNCITRAL)

[112] - Subject: Following a preparatory Working Group session in 1999 and conferences and colloquia in 2000 and 2001, UNCITRAL held a Working Group session in July-August 2001 to begin preparing a legislative guide on insolvency law. The Working Group has met five times since then to continue its work. Canadian representatives from the Departments of Justice and Industry have participated in the sessions.

[113] In essence, the Legislative Guide provides a framework for countries wishing to adopt modern insolvency legislation. Although Canada could adopt concepts articulated in the Legislative Guide, in general the Guide would not be used as a basis for a reform in Canada as the Bankruptcy and Insolvency Act is already a modern and relatively comprehensive insolvency regime.

[114] Although the review of addenda 1, 2 and 14 to 17 to the Legislative Guide remains to be done, the Commission has approved the scope of the draft and has given its preliminary approval to the key objectives, general features and structure of insolvency regimes set out in the Guide.

[115] Industry Canada has carried out consultations on a possible reform of the Bankruptcy and Insolvency Act. Canadian stakeholders have been informed of recent developments with respect to international insolvency. With few minor exceptions, the Legislative Guide is consistent with the Bankruptcy and Insolvency Act and the Companies' Creditors Arrangement Act.

[116] Joint sessions of the Working Group on Security Interests and the Working Group on Insolvency have been taking place to ensure consistency in areas of overlap between the two mandates.

[117] - Action required in Canada: Consult and prepare Canada's comments for the next session in collaboration with Industry Canada officials. The Working Group on Insolvency will be meeting in September 2003 to discuss remaining business.

h. Model Franchise Disclosure Law (Unidroit)

[118] - Subject: The Model Franchise and Disclosure Law originated from a proposal made in 1985 by the then Canadian member of Unidroit's Governing Council, Mr. T.B. Smith Q.C. A Study Group on Franchising was set up in 1993. In 1998, the Study Group completed the Unidroit Guide to International Master Franchise Arrangements. In December 2000, the same Study Group finalised both the Model Law and an Explanatory Report on the Model Law. On September 25, 2002 the Governing Council of UNIDROIT adopted the Model Franchise Disclosure Law.

[119] The Canadian expert to the study group was Mr. Alexander Konigsberg, in his personal capacity.

[120] The purpose of the Model Law is to establish obligations on the part of franchisors regarding disclosure of information and in particular, to determine the information to be disclosed in the "disclosure document". Some exceptions from the obligation to disclose are also mentioned. Finally, the Model Law creates remedies for the franchisee.

[121] In Canada, only Alberta and Ontario have enacted legislation regarding disclosure of information in the field of franchise law, in 1995 and 2000 respectively.

[122] In June 2002, the ULCC set up a new project to consider and make recommendations for the adoption of uniform franchise legislation throughout Canada.

[123] Action required in Canada: Consider the Unidroit Franchise Model Law in developing uniform Canadian Legislation.

i. Convention on International Leasing and Convention on International Factoring (UNIDROIT)

[124] - Subject: These Conventions, which are also known as the Ottawa Conventions since they were finalised in Ottawa in 1988, have been in force since May 1, 1995. The Leasing Convention is in force for eight States and the Factoring Convention is in force for six States. They provide uniform international rules to facilitate the financing of international commercial transactions.

[125] Canada is not yet party to either of the Conventions. In 1991, however, the Department of Justice consulted with the provinces, territories and interested private sector groups and experts on the desirability of Canada becoming a party to the Conventions. The responses received indicated that there was some support for Canada becoming party to both Conventions. Because of changes in the leasing industry and in light of the recent coming into force of the Conventions, however, consultations will be renewed with a view to making a recommendation as to whether Canada should become a party to the Conventions.

[126] Moreover, the Uniform Law Conference has prepared draft uniform legislation that may be adopted by interested jurisdictions for the implementation of the Conventions should there be sufficient interest in Canada's becoming a party.

[127] In May 2003, consultations were undertaken with lawyers in the private sector, in order to understand their degree of knowledge and interest in the Canadian ratification and implementation, of the two Unidroit conventions on international factoring and international leasing and the UNCITRAL Assignments Conventions.

[128] - Action required in Canada: Confirm views of the leasing industry, the provinces and territories to determine Canada's interest in joining these Conventions.

j. Draft Railway Rolling Stock Protocol to the Convention on International Interests in Mobile Equipment (Unidroit)

[129] The draft Railway Rolling Stock Protocol (Rail Protocol) will adapt to railway rolling stock equipment the mechanisms set out in the Convention. As railway rolling stock usually stays on the same continent where it has been bought and rarely leaves for another continent, it remains to be decided whether the framework will be global (universal) or regional (continental). Another possibility would consist in having a universal Protocol and regional registries (whether integrated or not).

[130] Joint meetings of governmental experts were held in June and October 2002 to continue the examination of the draft Rail Protocol. A Canadian delegation attended the meeting to gauge the interest of other States and the industry in such a Protocol.

[131] In October 2002 and March 2003, meetings have been held in Ottawa and Washington between several national delegations - among which the Canadian delegation - and representatives of the Association of American Railroads.

[132] A Second Joint Session of governmental experts was held in May 2003 to continue the study of the draft Rail Protocol. Several Canadian experts from the Departments of Transport and Industry took part. During that Session, sufficient on the structures and functions of an international registry was made to make convening of a diplomatic conference in 2004 a priority.

[133] The latest version of the draft Rail Protocol may be found on Unidroit's website at

[134] - Action required in Canada: Ongoing consultations on the Convention and the latest version of the draft Rail Protocol to develop the Canadian position on this project.

k. Draft Space Protocol to the Convention on International Interests in Mobile Equipment (Unidroit)

[135] The preliminary draft Space Protocol will adapt to space equipment the mechanisms set out in the Convention. Cooperation between Unidroit and the United Nations Committee for the peaceful Utilisation of Outer Space (COPOUS) is being sought.

[136] The Legal Subcommittee of COPUOS met in Vienna on March 24, 2003. The Subcommittee explained that its role did not consist in the drafting of the Draft Protocol, but in the informing of the participants about the role of the United Nations, especially as supervising Authority for the implementation of a possible treaty. Discussions were held about the jurisdiction of the UN on that subject-matter, and about the means and the potential responsibilities of the Organization. Discussions were also held about the functions of other treaties that structure space law.

[137] The latest version of the draft Space Protocol may be found on Unidroit's website at

[138] - Action required in Canada: Ongoing consultations on the Convention and the draft Space Protocol to develop the Canadian position in order to prepare for the Unidroit session of governmental experts in the fall 2002 or the winter 2003.

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