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Malta Maritime Law Association

Member of the Comité Maritime International

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MMLA President Dr Ann Fenech on The Judicial Sales of Ships

August 9, 2022 Leave a Comment

On June 30 in New York, the 55th Session of the United Nations Commission for International Trade Law (UNCITRAL) approved the text of the convention on the international effects of judicial sales of ships and this after the Commission had at its 35th Session in New York in May 2018 agreed to take on the project. It was a cause for great celebration for the Comité Maritime International (CMI) and for international maritime trade.

The convention owes its beginnings to a draft prepared by the CMI. In 2008 Henry Li from China suggested that the CMI should undertake a study on the subject matter.

It was evident that while in the majority of states, vessels sold in judicial sales are sold free and clear of any pre-existing claims, with their laws also providing for old creditors of such vessels to present their claims against the proceeds of the sale, there are states which refuse to recognise and give effect to the free and unencumbered title which accompany such judicial sales acquired by the purchasers of such vessels.

These instances lead to hugely challenging situations presenting serious interruptions to the orderly conduct of international trade, bearing in mind that 90 per cent of world trade is carried by sea.

This failure not only leads to mala fede claimants exerting illegitimate pressure on buona fide purchasers who would have spent good money in purchasing vessels in judicial sales, the failure also gives rise to great uncertainty for the new financiers of such vessels who assume they are financing vessels leading to a clean title, only to find old creditors making a claim against the ship purchased clean.

There have also been cases where old mortgagees refuse to let go of their pre-existing mortgages, causing problems to registrars of ships leading to great delays in the deletion of mortgages, or even ships from the old registries which in turn lead to further challenges with the registration of new mortgages.

These problems also lead to the question, which purchaser is going to risk paying top dollar for a ship in a judicial sale which is supposed to give him a clean title if after the sale, an old creditor can come along and arrest that vessel? This, in turn, leads to loss of confidence in judicial sales, leading to lower prices for ships in judicial sales, which in turn leaves less money for the vessel’s old creditors.

So between 2008 and 2014 the CMI worked on a draft convention aimed at ensuring that when a vessel is purchased in a properly held judicial sale free and clear of all previous debts, such a title will be given full effect by other state parties. The draft convention was called the ‘Beijing Draft’. Following its finalisation, the CMI needed to find an international legislative body for its draft, which would work on the project and turn it into an international treaty.

In July 2017 the CMI approached UNCITRAL, and the Commission at UNCITRAL recommended that the CMI should first hold an international colloquium with the maritime industry in order that the industry may express its view on whether there was a real need for such a convention. 

This international colloquium was organised in Malta by the CMI in conjunction with the Malta Maritime Law Association and the support of Transport Malta in February 2018, and it was attended by over 150 international maritime protagonists ranging from BIMCO to IACS, to ITF, ship owners, flag registries, financial institutions, ship owners, service providers and maritime judges. There was an overwhelming agreement on the need for certainty in international trade and on the need for such a convention.

Switzerland thus presented the conclusions of the Malta Colloquium and the ‘Beijing Draft’ to the 51st session of the Commission in June 2018 and, notwithstanding some very stiff competition, the proposal garnered support from a number of very important state delegations leading the Commission to decide that this was a topic that would be added to the work programme of the Commission. Subsequently, the project was given to Working Group V1 and from May 2019 it held five working sessions until the Working Group presented the finalised text to the Commission in June of this year. 

The 55th session of the Commission deliberated the draft for four days and approved the text of the Convention on June 30. It agreed to submit the text to the General Assembly of the United Nations recommending to the same General Assembly the adoption of the convention at its 77th session, the authorisation of a signing ceremony to be held as soon as practicable in 2023 in Beijing, upon which the Convention would be open for signature, and recommending that the Convention be known as the Beijing Convention on the judicial sales of ships.

It is anticipated that the General Assembly of the United Nations will adopt the convention at its 77th session in September.

This is the first article in a two–part series.

Source: The Times of Malta

Filed Under: CMI, International Law News, Judicial Sales, Latest, MMLA

MMLA President at UNCITRAL in New York

July 11, 2022 Leave a Comment

MMLA President and CMI Vice President Dr. Ann Fenech participated to the 55th session of the UNCITRAL: United Nations Commission on International Trade Law during which the Draft Convention on the International Effects of Judicial Sale of Ships was approved. The convention is expected to be adopted by the General Assembly of the United Nations in Autumn.

Dr. Fenech was the COMITE MARITIME INTERNATIONAL co-ordinator of the project in Working Group VI at UNCITRAL for the past 4 years.

Filed Under: CMI, Judicial Sales, Latest, MMLA

Final Draft Convention on the International Effects of Judicial Sale of Ships agreed at UNCITRAL

February 28, 2022 Leave a Comment

Dr Ann Fenech, President of the MMLA,  and CMI co-ordinator for the project at UNCITRAL, just returned from New York where she attended the 40th session of UNCITRAL Working Group V1. The meeting was held in a hybrid fashion between 7 – 11 February. Dr Fenech is pleased to report that the Working Group has completed its work by agreeing a final Draft of the Convention on the International Effects of Judicial Sale of Ships. 

Working Group V1 has been considering and deliberating this draft convention presented to UNICTRAL in the form of the Beijing Draft since May 2018, starting off with the Malta Colloquium organised jointly by the MMLA and CMI.   The Draft will now be presented to the Commission for its deliberation and approval in June and if approved the Convention will be presented to the General Assembly of the UN which will be followed by a  signing ceremony of the Convention which could be held in Beijing in the first quarter of 2023.

Filed Under: CMI, International Law News, Judicial Sales, Latest, Malta, MMLA, Uncategorized, UNCITRAL

MMLA AGM 2021

December 7, 2021 Leave a Comment

The MMLA recently held the AGM 2021. The meeting took place in a hybrid form with most of the Executive Committee members present in person and other members joining virtually. President Dr Ann Fenech opened the meeting with an update on the latest developments regarding the Beijing Draft Convention on the Effects of Judicial Sale of Ships. This was followed by a presentation by Dr Jotham Scerri Diacono on the workings of the subcommittee revising the MSA while Dr Adrian Attard explained the workings of the same subcommittee with regard to the Revision of the COCP.

After the President’s Report, the Reports of the active Subcommittees and the Treasurer’s Report and approval of the Budget 2022 the new Executive Committee was elected. The present officers were re-elected confirming President Dr Ann Fenech, Vice Presidents Dr Suzanne Shaw and Dr Matthew Attard, Secretary Dr Stephan Piazza and Treasurer Dr Nicholas Valenzia. Also re-elected were Dr Katrina Abela, Dr Lisa Camilleri, Dr Chris Cini, Dr Anthony Galea, Dr Anndrea Moran, Dr Robert Radmilli and Dr Jotham Scerri Diacono as members while Dr Alison Vassallo decided to step down in view that her new commitments in the yachting sector would take up her time. We thank her for her invaluable contribution over the years and welcome Dr Adrian Attard who was elected as a new member to the MMLA Executive Committee.

Filed Under: Latest, MMLA

MMLA President re-elected CMI Vice-President

October 1, 2021 Leave a Comment

President of the Malta Maritime Law Association Ann Fenech has been re-elected to serve as Vice President of the Comite Maritime International for a further 3 years.  She was elected unanimously by the member national maritime law associations of CMI during the CMI Assembly held virtually on 30 September 2021. Dr Fenech currently co-chairs the International Working Group on Judicial Sales and is the CMI co-ordinator for this project at UNICTRAL currently deliberating the 4th Annotated Revision of the Beijing Draft Convention on the Effects of Judicial Sale of Ship.

Filed Under: CMI, Latest, Malta, MMLA

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News & Publications

  • MMLA President Dr Ann Fenech on The Judicial Sales of Ships August 9, 2022
  • MMLA President at UNCITRAL in New York July 11, 2022
  • Meeting with the Minister of Justice May 30, 2022
  • Original Certificates Onboard Malta flagged Vessels: Some Practical Issues May 24, 2022
  • Final Draft Convention on the International Effects of Judicial Sale of Ships agreed at UNCITRAL February 28, 2022
  • The maritime industry within a modern world February 8, 2022

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International Events

The 2022 CMI Conference will take place physically in Antwerp, Belgium from 18-21 October.
Antwerp is the birthplace of the Comite’ Maritime International and this year we will be celebrating CMI’s 125th anniversary.
For the full programme and registration please click here

The CMI Virtual Assembly was held on 30 September 2021

The CMI Assembly and Colloquium was held in Mexico City between 30 September – 2 October 2019: Find out more…

The CMI held the Assembly meeting and other events on 8./9. November 2018 in London. Find out more…

The Malta Colloquium on Judicial Sales was held on 27 February 2018 in Valletta. Find out more…

 

 

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