ICC endorses UNCITRAL Convention on the Assignment of Receivables in International Trade
The International Chamber of Commerce has announced its endorsement of the United Nations Convention on the Assignment of Receivables in International Trade. The ICC Executive Board endorsed the Convention at its 146th World Council Session held in New York on 19-20 November 2014, upon recommendation by the ICC Banking Commission’s Executive Committee and the Legal Committee.
ICC supports the Convention's purpose to establish principles and rules to create clarity and transparency in the legal regime applicable to the assignment of international receivables. ICC also aligns itself with the Convention's objective to promote the modernization of the law relating to assignments of receivables, while protecting existing assignment practices and facilitating the development of new practices.
ICC bank and firm members have reported situations where financings had to be reviewed or abandoned as a result of laws considering the assignment of future receivables or bulk assignments of receivables as ineffective. ICC welcomes the Convention's validation of assignments of future receivables and bulk assignments, invalidating contractual limitations to the assignment of receivables, and offering clear rules as to priority between competing claims. As such, ICC expects the Convention to remove legal obstacles to receivables financing transactions.
ICC shares a common goal with the United Nations Commission on International Trade Law (UNCITRAL) in striving to remove obstacles for international trade and considers the Convention to be a major step towards the globalization of asset-based lending.
ICC has a long history of providing needed international leadership in the field of international banking operations, particularly as a forum for developing rules of practice. Since 1933, the Uniform Customs and Practice for Documentary Credits (UCP), in its various revisions, has become a universally recognized standard, stating and establishing custom and practice for letters of credit.
Through endorsement of the subsequent UCP versions, UNCITRAL provided an important bridge to those countries that were, at the time, unable to participate directly in the work of ICC. Other ICC rules, such as Incoterms© Rules, have also been endorsed by UNCITRAL, contributing to their international acceptance.
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