International Movement of Securities: Private Law Aspects

Abstract

The need to unify conflict of laws rules that comport with the reality of how securities are held and transferred today by electronic book-entry debits and credits to securities accounts has become important. Legal uncertainty as to the law governing the effects of transfers imposes significant friction costs on transactions and operates as an important constraint on desirable reductions in liquidity exposure and as a result hinders the liquidity of the stock market. To address the current uncertainties at growing financial markets, the Convention on the Law Applicable to Certain Rights in Respect of Securities held with an Intermediary was adopted on 13 December 2002.