From 13 to 17 May 2019, UNCITRAL Working Group VI (Judicial Sale of Ships) is expected to start work on preparation of a draft instrument on the judicial sale of ships.
“5. At its fiftieth session (Vienna, 3–21 July 2017), the Commission noted the importance of a proposal by the Comité Maritime International (CMI) for possible future work on cross-border issues related to the judicial sale of ships (A/CN.9/923). The CMI proposal drew attention to problems arising around the world from the failure to give recognition to foreign judgments ordering the sale of ships.1 It was stated that a short, self-contained instrument along the lines of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards could provide a solution to those problems by enabling clean title to vessels to be recognized across borders. While swift resolution of the questions raised by the proposal was encouraged, it was agreed that additional information in respect of the breadth of the problem would be useful.
7. [In 2018, a colloquium in respect of the cross-border judicial sale of ship] resulted in a number of findings. It was agreed that the “lack of legal certainty in relation to the clean title which a judicial sale is intended to confer on a buyer” led to problems in the de-registration process in the country of the former flag. It was also agreed that the lack of legal certainty created obstacles in respect of the clearance of all former encumbrances and liens, which in turn created a risk of costly and lengthy proceedings, thereby interrupting trade and shipping. Finally, there was broad agreement that the gap could be filled from a legal perspective by providing an instrument on the recognition of judicial sales of ships.
8. At its fifty-first session (New York, 25 June – 13 July 2018), the Commission considered a proposal from the Government of Switzerland, “Possible future work on cross-border issues related to the judicial sale of ships” (A/CN.9/944/Rev.1), which included the outcomes and conclusions of the Colloquium and requested that UNCITRAL undertake work to develop an international instrument on foreign judicial sale of ships and their recognition.
9. In support of the proposal, it was noted that the lack of recognition of the judicial sale of ships had the potential to affect many areas of international trade and commerce, not simply the shipping industry, with several examples of that impact being provided. In support of work being undertaken by UNCITRAL, various parallels were drawn between the work being undertaken in Working Group V on recognition of insolvency-related judgments and a possible instrument on the judicial sale of ships”.
10. The Commission considered the proposal together with other suggestions for future work in the context of its deliberations on its work programme at its fifty-first session. After discussion, it was agreed that the topic of judicial sale of ships should be added to the work programme of the Commission.
11. At its thirty-fifth session, the Working Group is expected to start work on preparation of a draft instrument on the judicial sale of ships on the basis of the CMI proposal, taking into account the outcomes and conclusions of the Colloquium”.
The proposed draft Instrument prepared by the Comité Maritime International on Judicial Sale of Ships may be found here
The proposals of the Comité Maritime International and of Switzerland for possible future work on cross-border issues related to judicial sale of ships may be found here