ASSEMBLY’S LEGAL COMMITTEE, BEGINNING SUBSTANTIVE WORK, TAKES UP REPORT OF UN INTERNATIONAL TRADE LAW COMMISSION

Sixtieth General Assembly

Sixth Committee

1^st Meeting (PM)

ASSEMBLY’S LEGAL COMMITTEE, BEGINNING SUBSTANTIVE WORK, TAKES UP

REPORT OF UN INTERNATIONAL TRADE LAW COMMISSION

Major Issue for New Session Likely to Be Need

For Comprehensive Convention on Global Terrorism

The Sixth Committee (Legal) began its substantive work this afternoon against the backdrop of an urgent need to conclude a comprehensive convention on international terrorism.

Nicolas Michel, Under-Secretary-General for Legal Affairs, spoke of the urgent need for the completion of the Committee’s work on the instrument, observing that the adoption of the Convention for the Suppression of Acts of Nuclear Terrorism was a great success.  He added that the 90 signatories it had attained so far was a good sign.

The Committee’s Chairman, Juan Antonio Yañez-Barnuevo, recalled the references to the rule of law and international law in the Outcome document of the 2005 World Summit, and said the Sixth Committee should be prepared to meet new challenges and spare no effort to strengthen the rule of law in international relations.

The Committee’s first task was examination of the report of the United Nations Commission on International Trade Law (UNCITRAL).  Delegates welcomed the finalization of a draft convention on electronic communications in international contracts, with one saying that the treaty would remove obstacles to its use in international trade, and would assure companies and traders around the world that electronically negotiated contracts were fully valid and enforceable.

Presenting the report, Jorge Pinzon Sanchez ( Colombia), Chairman of UNCITRAL’s thirty-eighth session, urged the Sixth Committee to approve the new instrument during its current session.  The text complemented and built upon earlier UNCITRAL instruments, including the UNCITRAL Model Law on Electronic Commerce and the UNCITRAL Model Law on Electronic Signatures.

As speakers underscored the need for UNCITRAL to promote awareness of its work, the representative of Namibia, speaking on behalf of the African Group, pointed out that the Commission’s work on capacity-building and technical assistance was of immense benefit to developing countries which often lacked their own expertise in international trade matters.  He lamented that the assistance relied heavily on unpredictable extrabudgetary funding.

Also speaking this afternoon were the representatives of Austria, France, United Kingdom, Thailand, Belarus, Republic of Korea, Singapore, Guatemala and Australia.

In addition to the reports on terrorism and UNCITRAL, other major topics to be discussed by the Sixth Committee are reports on the International Law Commission’s work, on the scope of legal protection under the Convention on the Safety of United Nations and Associated Personnel, from the Special Committee on the Charter of the United Nations and Strengthening the Role of the Organization, and from the Committee on Relations with the Host Country.

Two working groups were established this afternoon -- one on the scope of legal protection under the Convention on the Safety of United Nations–associated personnel, headed by the Chairman of the Ad Hoc Committee on the question, Christian Wenaweser of Liechtenstein, and the other on terrorism, chaired by Rohan Perera of Sri Lanka, who is also chairman of the Ad Hoc Committee on Terrorism.

In another action, Shermain Jeremy of Antigua and Barbuda was elected Rapporteur of the Committee.  The other members of the bureau are Juan Antonio Yanez-Barnuevo ( Spain), Chairman; Mahmoud Hmoud ( Jordan), Vice-Chairman; Mahmoud Samy ( Egypt), Vice-Chairman; and Grzegorz Zyman ( Poland), Vice-Chairman.

The Committee will meet again tomorrow, 4 October, at 10 a.m. to continue its discussion of UNCITRAL topics.

Background

The Sixth Committee (Legal), at its first meeting of the General Assembly’s sixtieth session, this afternoon began considering the report of the United Nations Commission on International Trade Law (UNCITRAL) on the work of its thirty-eighth session (document A/60/17), which took place from 4 to 15 July 2005, in Vienna.

Among Committee’s main agenda items for the Assembly’s sixtieth session are issues related to the promotion of justice and international law, drug control, crime prevention and combating international terrorism in all its forms and manifestations.  The agenda also has items related to organizational, administrative and other matters.

Discussion of measures to eliminate international terrorism is expected to dominate the session.  A working group will continue work being done by the Ad Hoc Committee on the topic, within the Sixth Committee framework.

The major development of UNCITRAL’s thirty-eighth session was the completion of a new draft convention on the use of electronic communications in international contracts.  The instrument is intended to remove obstacles to the use of electronic communication in international contracting, including those that might arise under existing international trade law regimes.  Most of those texts were negotiated long before the development of new technology, such as e-mail, electronic data interchange and the Internet, according to the Commission’s report.

The draft convention complements and builds upon earlier instruments prepared by the Commission, including the UNCITRAL Model Law on Electronic Commerce and the UNCITRAL Model Law on Electronic Signatures.  It was prepared by UNCITRAL’s Working Group on Electronic Commerce over a number of sessions, between 2002 and October 2004 when it completed its task.

The new instrument deals, among other things, with the determination of a party’s location in an electronic environment; the time and place of dispatch and receipt of electronic communication; and the use of automated message systems for contract formation.  Other provisions contain criteria establishing functional equivalence between electronic communications and paper documents -- including “original” paper documents -- as well as between electronic authentication methods and hand-written signatures.  The UNCITRAL states that the new convention will assure companies and traders around the world that contracts negotiated electronically are as valid and enforceable as traditional paper-based transactions.

Other topics discussed during UNCITRAL’s 2005 session were the progress reports of its Working Groups, and possible future subjects to be examined by them.  As a follow-up to the adoption of the draft convention, the Commission decided that the Working Group on Electronic Commerce could discuss legal issues concerning cross-border recognition of electronic signatures and online dispute resolution.

During the session, the Working Group on Procurement reported on its ongoing revision of the 1994 Model Law on Procurement of Goods, Construction and Services, to reflect new practices -- in particular those that resulted from the use of electronic communications in public procurement.  The Working Group on Transport Law presented a report on its development of a new international transport convention with multimodal application, encompassing innovations such as electronic transport documents.  The Working Group on Security Interests reported on its preparations of a draft legislative guide on secured transactions.  The Working Group on Arbitration, in its report, said it was drafting an article revising the UNCITRAL Model Law on International Commercial Arbitration, with respect to the provision of interim measures, including whether they could be ordered on an ex parte basis.

A number of proposals were made during the session for future work to be undertaken by the Commission on the topic of insolvency law, including on the treatment of corporate groups in insolvency and the use of cross-border protocols in traditional insolvency cases.  To obtain the views of experts and international organizations, the Commission agreed to hold an international colloquium in Vienna from 14 to 16 November 2005.

The UNCITRAL is composed of 60 member States elected for six-year terms by the General Assembly.  The Commission, which began its work in 1968, two years after its establishment by the General Assembly, promotes the progressive harmonization and unification of international trade law.  It prepares legal texts in a number of key areas such as international commercial dispute settlement, electronic commerce, insolvency, international payments, sale of goods, transport law, procurement and infrastructure development.  The UNCITRAL also provides technical assistance to law reform activities, including assisting member States to review and assess their law reform and to draft the legislation required to implement UNCITRAL texts.

Statements

Opening this afternoon’s meeting, JUAN ANTONIO YAÑEZ-BARNUEVO ( Spain), Chairman of the Sixth Committee, said Member States were facing particular challenges at a time of the Organization’s sixtieth anniversary.  In a global and interdependent world, international law was playing an important role in all aspects of relations among nations.  He said the ever-increasing role of international law in contemporary international relations had been duly reflected in the 2005 World Summit Outcome document (A/Res/60/1) which contained references to international law.  The world leaders reaffirmed, in particular, their “commitment to the purposes and principles of the Charter and international law, which are indispensable foundations of a more peaceful, prosperous and just world”, and reiterated “their determination to foster strict respect for them”, he said.

While the Sixth Committee took pride for its past role in the progressive development of international law and its codification, he said, it should be prepared to meet the new challenges and spare no effort to strengthen the rule of law in international relations.  He recalled that the Secretary-General in relevant statements had called upon Member States to do so.  He hoped Committee members would make every effort to live up to that expectation.  He went on to outline in detail the Committee’s programme of work, noting that 28 October was considered the mandatory deadline for submission to the Fifth Committee of draft resolutions with financial implications, except for the draft resolution on the report of the International Law Commission.  November 9 had been fixed as the concluding date for the work of the Sixth Committee.

Stressing the importance of the early start of meetings, he said he had been informed that during the fifty-ninth session, the Sixth Committee lost seven hours and 15 minutes due to late starts, and 12 hours and 20 minutes due to early endings.  From 63 per cent utilization of time in 2001, the utilization had been improved to 84 per cent in 2002, which was above the benchmark figure of 80 per cent established by the General Assembly.  However, the utilization was lower than the benchmark in the past two years -- 74 per cent in 2003, and 78 per cent in 2004.  He hoped that improvements could be made with the cooperation of Committee members.

NICOLAS MICHEL, Under-Secretary-General for Legal Affairs, in a statement, also noted the references to the rule of law and international law in the 2005 World Summit Outcome document.  He mentioned the need for the completion of work on a comprehensive convention on international terrorism.  He observed that the adoption of the convention on acts of nuclear terrorism was a great success, adding that the 90 signatories it had attained so far was a good sign.  He said the report of the International Law Commission was important and urged Committee members to provide inputs to the Commission’s work during the debate on the report later this month.

JORGE PINZON SANCHEZ (Colombia), Chairman of the thirty-eighth session of UNCITRAL, presenting its report, said the Commission had, to date, developed and explored new areas where its expertise and knowledge enhanced trading and contributed to a stable international trade law.

He said the new draft convention on the use of electronic communications in international contracts served as a useful basis for simplifying various domestic rules that applied to electronic commerce and enhanced confidence and trust in the use of electronic commerce in cross-border trade.  The instrument had been carefully crafted so as not to negatively affect the well established regime of the United Nations Convention on Contracts for the International Sale of Goods.  It did not interfere with the law of contract formation, in general, and the treatment accorded Internet-based sales transactions did not generally differ from the treatment given to sales transactions conducted by more traditional means.

The Commission circulated the draft text of the convention to all United Nations Member States for comment prior to its consideration at its thirty-eighth session.  In approving the draft convention, the Commission was satisfied that it had received sufficient consideration and reached the level of maturity required for it to be generally acceptable to States.  He urged the Sixth Committee to approve it during its current session as the United Nations Convention on the Use of Electronic Communications in International Contracts.

He said technical assistance to Member States in their law reform continued to form an indispensable element of the Commission’s work.  A technical assistance and coordination unit was established within the Commission’s secretariat this year to identify national and regional needs.  He reiterated the Commission’s appeal to States and international organizations for contributions to the UNCITRAL Trust Fund to meet the increasing demands for technical assistance.

The Commission’s secretariat had prepared the first of a series of annual surveys on the work of international organizations involved in the harmonization of international trade laws, focusing on substantive legislative work.  With regard to future work on electronic commerce, he said the Commission had agreed on a detailed report to be prepared by its secretariat for its consideration in 2006, concerning possible areas on which it could undertake legislative work in the future, as well as areas in which legislators and policy makers might benefit from comprehensive information.

Finally, he informed the Sixth Committee that 2005 marked the twentieth anniversary of the adoption of the UNCITRAL Model Law on International Commercial Arbitration and the twenty-fifth anniversary of the United Nations Convention on Contracts for the International Sale of Goods.  The Commission’s secretariat had organized and co-sponsored conferences to celebrate those anniversaries in different regions.  The year 2006 will mark the thirtieth anniversary of the UNCITRAL Arbitration Rules, and the Commission had recommended the organization of similar conferences to celebrate that anniversary.  One such conference would take place in Vienna on 6 and 7 April 2006 under the auspices of the Vienna International Arbitral Centre attached to the Austrian Federal Economic Chamber.

In addition, in the context of its fortieth annual session in 2007, the Commission planned to hold a congress in Vienna to review the results of its past sessions and to evaluate topics for its future work programme.  He said the General Assembly might wish to acknowledge the importance of those activities in the context of the Commission’s work in coordinating and promoting further modernization, harmonization and unification of international trade law.

KONRAD BÜHLER ( Austria) commended the efforts to increase the Commission’s coordination and cooperation, as the core legal body within the United Nations system in the field of international trade law, with other international organizations active in the field.  Austria also commended the Commission for concluding the important and future-oriented draft convention on e-commerce.  Austria attached particular importance to the work on a draft legislative guide on security interests and looked forward to an early completion of the project next year.  He welcomed the decision to hold a congress in 2007 in Vienna on international trade law to review the past work of UNCITRAL and assess current work programmes and consider topics for the future.

Noting that next year marked the thirtieth anniversary of the adoption of the UNCITRAL Arbitration Rules, used worldwide in the settlement of disputes concerning international trade and investment, he said a conference to celebrate the anniversary would be held in Vienna on 6 and 7 April 2006.

BRIGITTE COLLET (France) said the draft convention on e-commerce would be very useful in creating conditions for recognition of electronic documents by providing the necessary guarantees as to their safety and integrity.  She expressed regret, though, that insufficient attention had been given to the concept of legal security.

The enlargement of the Commission from 36 to 60 members was a sign of the growing interest around the world in its work.  She commended the efforts of UNCITRAL to coordinate with other international organizations in the field and said the Commission should seize this opportunity to strengthen the work of UNCITRAL.  Concerning UNCITRAL’s model laws and legislative guides, she believed the Commission should make greater use of independent expertise rather than relying on those who simply defended the interests they represented.  She pointed out the importance of communication of the Commission’s work into all the official languages, referring specifically to French-speaking countries, to allow all to participate fully.

GAVIN WATSON (United Kingdom), in welcoming the successful conclusion of  the draft convention on e-commerce, said the convention recognized a number of complexities in the area which could provide a firm foundation for countries seeking to establish an appropriate basis to promote the development of
e-commerce.  The compromise arrived at by the working group on arbitration on the issue of ex parte interim measures remained extremely controversial.  The United Kingdom believed that the provision, if included, should be in the form of an opting-in provision, applying only where the parties had expressly agreed to its application.  His country was also pleased to note that the thirtieth anniversary of UNCITRAL Arbitration Rules would be celebrated and looked forward to attending the conference in Vienna in April 2006.  The United Kingdom also welcomed the Commission’s discussion on insolvency law.

ITTIPORN BOONPRACONG ( Thailand) said that his country strongly supported greater coordination and cooperation between UNCITRAL and other organizations to prevent possible duplication of work and inconsistency in legal instruments aimed at addressing the same legal issue.  Towards that end, Thailand welcomed the UNCITRAL secretariat’s efforts to engage, in dialogue, a number of organizations such as the World Bank, the International Monetary Fund (IMF).  He called for increase in UNCITRAL’s resource allocations.  He said the convening of UNCITRAL’s congress in 2007 was of critical importance as it aimed to review the Commission’s past work programme, assess its current ones and to elaborate its future work.

Thailand welcomed the Commission’s new website (www.uncitral.org) launched in June 2005.  It had enabled delegates to access UNCITRAL documents, thus, enhancing its programme of information activities and training and technical assistance.  His delegation encouraged UNCITRAL secretariat to continue to improve the website.  He urged more resources for UNCITRAL to expand its technical assistance programmes to support and promote national enactments of UNCITRAL model laws and conventions in developing countries.  UNCITRAL’s success depended on widespread incorporation of its legal texts into national laws, he said.

ANDREI METELITSA ( Belarus) said his country supported the work of UNCITRAL’s Working Group on procurement, which was preparing proposals for the revision of the Model Law on Procurement of Goods, Construction and Services.  Belarus had begun adapting and updating relevant aspects of that law into its domestic legislation.  Belarus shared the concerns of many UNCITRAL members about reports proving violations of the 1958 New York Convention, including improper form of arbitrage agreements by the subject of international contracts.  He also expressed his country’s interest in the work of the Working Group on Transport Law.  He expressed his country’s support for UNCITRAL’s technical assistance programmes and the widening of the venues for its seminars.

SHIN YOO-CHUL (Republic of Korea) said the draft convention on electronic communications in international contracts would remove obstacles to its use in such as e-mail, EDI and the Internet in international trade, and would assure companies and traders around the world that electronically negotiated contracts were fully valid and enforceable, thus, enhancing certainty and predictability.  As one of the leading countries in e-commerce, the Republic of Korea had already enacted related legislation based on UNCITRAL’s model laws on e-commerce and electronic signatures.

Informal working methods, while useful to the completion of a draft instrument on the carriage of goods by sea, had certain flaws which must be addressed.  There was an apparent lack of cooperation between the informal intersessional working group and the Secretariat in establishing the agenda and preparing documents.  The working group proceeded on the basis of its own rather improvised agenda which was not publicly known until the last moment, and some documents were distributed as the discussion was happening.

Citing a breakthrough on the issue of ex parte interim measures in international commercial arbitration, he said that the compromise that the provision would apply unless otherwise agreed by the parties had been hard fought and should not be disregarded at a later stage of discussion.

MARTIN ANDJABA (Namibia), speaking on behalf of the African Group, said the Group supported the recommendation that the General Assembly consider adopting the timely draft convention on e-commerce during the current session.  UNCITRAL’s work on capacity-building and technical assistance was of particular importance to the African Group because of its immense benefit to developing countries and countries in transition who lacked adequate expertise in international trade matters.  Unfortunately, that important arm of UNCITRAL’s work relied heavily on unpredictable extrabudgetary funding.  In thanking Mexico, Singapore and Switzerland for their recent contributions to the Trust Fund, he urged other countries which were in a position to do so to consider contributing, as well.

He said no recent contributions had been made to the trust fund for travel assistance and, therefore, many developing countries, many of them from Africa, had been unable to send their experts to the various meetings of the Commission and its working groups.  The Commission should seek innovative ways of addressing that problem, he said.

EDGAR PANG ( Singapore) noted that UNCITRAL texts -- the United Nations Convention on the International Sale of Goods and the UNCITRAL Model Law on Arbitration -- had been enacted as part of his country’s domestic law.  Singapore was actively promoting their acceptance by countries in its region.  As an indication of its commitment to the wider application of those instruments, he said Singapore was one of the venues for seminars held to commemorate the twenty-fifth and twentieth anniversaries, respectively, of those instruments.  The newly adopted UNCITRAL convention on the use of electronic communications in international contracts would play a major role in world trade.  It enabled trading transactions to be conducted efficiently and without the restriction of national boundaries.

As a small country heavily reliant on international trade, he said, Singapore was especially attracted to the potentials of electronic commerce.  It was extremely happy that UNCITRAL had formulated that convention which sought to introduce certainty in the use of electronic communications in international contracts.  It was also pleased that the draft text was prepared by a working group that was headed by a Singapore national.  He also noted with great interest the work of other UNCITRAL working groups.  Singapore looked forward to the completion of the work of the Working Group on Arbitration, which had already taken considerable time and resources.  He said participation in the work of the working groups required considerable commitment and resources.  It was important that their processes should be efficient and effective.

ROBERTO LAVALLE-VALDES ( Guatemala) said that UNCITRAL’s work was praiseworthy.  Its reports had always been extraordinary.  He recalled the Commission’s achievements over the past six years, including the legal texts that it had adopted during the period.  No session seemed to conclude without the adoption of a text by the Commission.  He also recalled the model laws adopted in 2002 and the conventions in the subsequent years after.  He said the new draft convention on the use of electronic communications in international contracts, if adopted by the General Assembly, would be a welcome addition to the work carried out by the Commission.  He noted that the new convention built upon earlier UNCITRAL instruments, including the UNCITRAL Model Law on Electronic Commerce and the UNCITRAL Model Law on Signatures.  He was pleased that the Commission’s report contained detailed discussion of the new convention.  That would be useful in any future interpretation of the text.

BEN PAYLE ( Australia) commended the completion of the draft convention on e-commerce, which he said reflected the increasingly important role played by information and communications technology in international trade.  Related to that was the consideration of electronic communications and technologies in procurement.  He welcomed the focus on addressing authentication and registration through the Internet of tender management systems.  Australia was disappointed that the issue of ex parte measures continued to delay conclusion of the model law concerning arbitration and conciliation.

The issue of liability for loss or damage to sea cargo was particularly important to Australia, given the importance of transport by sea to Australia’s international trade.  Australia was looking for a regime that struck a fair balance between the interests of shippers and carriers.  Such a balance was important for a new regime to be widely adopted.

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