Report on Judicial Sales, December 2022
Comité Maritime International
14th December 2022,
Update on Judicial Sales – Ann Fenech co-chair IWG – Judicial Sales
I must start this communication by giving you the most important news which is, for those of you who have not followed our Linked In page, that on 7th December 2022 the General Assembly of the United Nations adopted the United Nations Convention on the Judicial Sales of Ship. It also authorised a signing ceremony for the Convention to be held as soon as practicable in 2023 in Beijing and also recommended that the Convention be known as the “The Beijing Convention on Judicial sales.”
The press release appearing on the UN accessible at:
states: “ The Beijing Convention will enhance legal certainty by creating a uniform regime for the international effects of judicial sales of ships… The convention is expected to provide legal protection for purchasers of ships sold by judicial sale, while safeguarding the interests of shipowners and creditors. It does this by providing uniform rules that the clean title acquired by the purchaser in the ship will be recognised internationally while requiring a certificate of judicial sale only to be issued if certain safeguards are met….. The International Maritime Organization will act as the repository of notices and certificates of judicial sales under the Convention.”
This is of course absolutely super news. As we had announced during the three sessions on Judicial Sales during the Antwerp Conference, the General Assembly of the United Nations was expected to adopt the Convention during its current 77th session however we were not expecting that to be so soon and were anticipating that adoption would be during January 2023.
This news has been very enthusiastically met by all who were involved in this hugely interesting process starting with the work that was done by Henry Li and the first IWG on Judicial sales which produced the Beijing Draft, the work done by the second IWG which took the project to UNCITRAL, by all those delegations who participated in Working Group V1 throughout that 4 year process, as well as the UNCITRAL secretariat particularly Madame Anna Joubin Bret, Jose Angelo Estrella-Faria Principal Legal Officer UNCITRAL secretariat and Alexander Kunzelman and the chair of Working Group VI, Prof. Beate Czerwenka. A big thank you goes to the NMLAs who were instrumental in assisting their state delegations and other delegations such as the European Commission, IMO, BIMCO, ICS, ITF, IUMI, Law Asia, IAJ, IBA, Institute of Arbitrators and numerous others.
Of course we now need to focus on what happens next. The next step will be to have our existing IWG morph into one which puts together an action plan on how CMI can assist States through NMLAs to ratify the Convention. We intend to make full use of the Colloquium in Montreal between the 14th and 16th of June 2023 to explain the full details of the Convention and I can also advise that we will be preparing a publication which will contain the key documents including the Convention, Explanatory Notes and other important documents. This document will have multiple uses. It will be a must have publication on the desk of every maritime law practitioner and more importantly will be the “educational tool” that may be used to explain the Convention, the raison d’etre of the Convention and the importance of the Convention in our next task to convincing member states to ratify the Convention. Peter Laurijssen will be the Editor in Chief of this publication.
In the meantime the Antwerp conference dear friends was a huge success for Judicial sales. Our “informal” Wednesday session saw a room filled to capacity with standing room only. The intention behind this informal session was to have an exchange of views on the significance and importance of the Convention to the market today, the role and function of the IMO as the repository of the notices of judicial sale and of the certificates of the judicial sale, and on how to encourage ratification by states.
Peter Laurijssen and I chaired the session and we heard from Leyla Pearson from the International Chamber of Shipping, we had a virtual intervention from Soren Larsen from BIMCO, a testimonial from Tilman Stein from Deutsche Bank, interventions from Harmen Hoek – representing IBA, Petra De Bruin from the Rotterdam judiciary apart from Angele de Sears from the Legal and Policy Office of the Civil Justice Unit of the EU Commission, Jose Angelo Estrella Faria, Beate Czerwenka and Fred Kenney Director legal affairs at the IMO. This was an informal session which was very useful on many levels with a great deal of interaction amongst those present. See photos attached.
On Thursday we had the formal presentations by Angele de Sears who shared with us the EU’s role in the UN Convention on the international effects of judicial sales of ships including a very interesting plan of the next steps of the EU in relation to the Beijing Convention; Jose Angelo Estrella Faria spoke about “Beijing via Vienna and New York – the UNCITRAL/ CMI common journey towards the newest maritime law convention” and Beate Czerwenka spoke on the “Key Challenges for the Unification of the Law on Judicial Sales of Ships”. This was followed by a panel dealing with various aspects of the convention – the panellists were myself introducing the convention, Tomotaka Fujita dealt with article 3 Scope of the Convention and what is not covered, Frank Nolan dealt with article 4 – notice of judicial sales, Jan Erik Poetschke dealt with article 5 – certificate of judicial sale and Peter Laurijssen dealt with articles 7,8 and 9 covering the obligations of the Registrar, the no re arrest of the vessel and the exclusive jurisdiction of state of judicial sale and Fred Kenney dealt with article 11 and the Repository. See photos attached
The only complaint regarding this session was that we did not have sufficient time to have a fuller explanation of the convention, however we plan to make up for that in Montreal where we will have a session totally dedicated to a discussion of the convention.
On Friday during the General Assembly there was also a very special moment dedicated to judicial sales. It had been Past President, Chris Davis’ wish to present the members of both CMI IWGs with a memento for the hard work carried out by the members of both groups. Chris therefore presented those members present with a wonderful glass token inscribed with the name of each recipient and with the words “In recognition of your efforts on the Judicial Sales IWG leading to approval by UNCITRAL of the Convention on the International Effects of Judicial Sales of Ships on 30th June 2022”. See photos attached.
So were we do we go from here? As stated above, we will now have the 3rd IWG on Judicial sales and this group will be tasked with assisting in the ratification process. We know that it is not enough for the CMI to draft instruments and to assist with ensuring that such instruments become conventions. I firmly believe that the CMI has an additional role to play which is to assist states to work towards a ratification process. Our convention needs 3 member states for it to come into force. This low entry level was intentional and this was to encourage member states to ratify a convention which would come into force very quickly. International trade demands quick and decisive action and we are convinced that the CMI can be of assistance through its national maritime law associations and titulary members and consultative members to move states towards ratification in a speedy manner.
We will of course now be waiting to hear further on when exactly the signing ceremony will be held following which the Convention will be open for ratification. However we can certainly start to work with NMLAs and States with the assistance, in particular of all the consultative and titulary members of the NMLA to help spread the word. We will also be working with the Secretariat at UNCITRAL to achieve this goal.
Members of the IWG are ready and able to take part in any forum to assist with explaining the convention and we are at the disposal of all NMLAs and others for any assistance any of us can give. The members of the IWG on Judicial sales up to now, going forward are:
Henry Li and myself as co-chairs, Peter Laurijssen as rapporteur, Stuart Hetherington, Frank Nolan, Tomotaka Fujita, Jan Erik Poetschke, Eduardo Albors, Paula Backden, Andrew Robinson and Benoit Goemans.
Finally a big thank you to all – this is certainly the time to underline how this Convention continues to showcase the relevance and importance of the CMI in the important role it plays in the unification of International maritime law.