02 Dec 2016

UNIDROIT Symposium to develop a Fourth Protocol to the Cape Town Convention

Rome, December 2, 2016 - WFO participated to the symposium organised by the International Institute for the Unification of Private Law (UNIDROIT) for its member States and States parties to the Cape Town Convention to discuss UNIDROIT’s current project to develop a Fourth Protocol to the Cape Town Convention on matters specific to Agriculture, Construction and Mining Equipment (the MAC Protocol).

The symposium offered an opportunity for countries to get a better understanding of the legal and economic benefits of the MAC Protocol, and provided further information on how countries can prepare for the first session of the UNIDROIT Committee of Governmental Experts tasked with preparing a draft MAC Protocol.

As underlined by the speech of the UNIDROIT Secretary General, Mr José Angelo Estrella Faria, the Protocol will create a robust, internationally enforceable secured financing system for high value mining, agriculture and construction equipment (MAC equipment), providing enterprises engaged in agriculture, construction and mining with the ability to optimise their activity and allowing producers of equipment to export to markets that without such a protocol would remain closed to them.

Ms Anna Veneziano, Deputy Secretary-General at UNIDROIT explained that since the 2005 proposal of the US and German governments to regulate high-value equipment different from aircrafts and satellites, the UNIDROIT Governing Council has been working to develop, through a study-group composed of various international experts in secured transactions law (2014), a substantive legal instrument which will lower the risk of credit for acquiring MAC equipment, allowing businesses in countries which have ratified the Protocol to acquire sophisticated, high value MAC equipment cheaper and more efficiently.

Mr Marek Dubovec, Senior Research Attorney at National Law Center for InterAmerican Free Trade, stressed the importance of the benefits resulting from this legal instrument, such as the growth of market competition and credit risk diversification. Due to the increased access to credit and bank loans, in fact, the acquisition of high value MAC equipment will be possible also for businesses which previously lacked of availability of affordable private financing.

As emerged from the symposium, better access to high value MAC equipment will lead to growth and increased efficiency in the agricultural industry and to improved financing for agricultural enterprises.Therefore, WFO has been invited to participate in the negotiation of this treaty which will take place from 20 to 24 March 2017 at the headquarters of the Food and Agriculture Organization of the United Nations as the organisation representing the interests of farmers globally.