UNIDROIT GENERAL ASSEMBLY MEETING OF DECEMBER 1

UNCLAS SECTION 01 OF 02 ROME 004134

SIPDIS

FROM THE U.S. MISSION TO THE UN AGENCIES IN ROME

L/PIL FOR HAL BURMAN AND JEFF KOVAR
IO/S FOR TED FARIS

E.0. 12598: N/A
TAGS: AORC ABUD UNIDROIT
SUBJECT: UNIDROIT GENERAL ASSEMBLY MEETING OF DECEMBER 1

REF: A) ROME 8483 B) ROME 2162 C) ROME 780


1. Summary: the General Assembly of the International
Institute for the Unification of Private Law (UNIDROIT)
met on December 1 to review the organization's work and
to approve the budget for 2006 and the program of work
for the upcoming triennium (2006-08). The Secretary
General (SYG) provided an update on the hiring of a
Deputy Secretary General (DSYG) (ref B) as well as an
assessment of current arrears. The budget for 2006 was
approved as recommended by the Finance Committee (ref A),
and the UNIDROIT statutes were amended to reflect an
earlier ad-hoc committee recommendation (ref C) on a
method of guaranteeing geographic representation on the
Governing Council. Finally, the U.S. will remain a
member of the Finance Committee for the 2006 08
triennium. End Summary.


2. On December 1, the UNIDROIT General Assembly met at
the organization's headquarters in Rome. After electing
the Portuguese perm rep as chair for the session and
approving the agenda, the secretariat presented an
overview of the Institute's activities for 2005 as well
as an update on the hiring of a Deputy Secretary General.
Regarding UNIDROIT's current projects, the draft protocol
regarding International Interests in Mobile Equipment on
Matters Specific to Space Assets is behind schedule,
primarily because the organization's principal research
officer is also the acting DSYG and his time has been
otherwise occupied. The Institute had hoped to organize
a conference in early 2006, hosted by Hungary, regarding
the Railway Rolling Stock protocol. Unfortunately the
GOH has decided against hosting, so UNIDROIT is searching
for another venue and is still hopeful to hold a
conference later in the year. The draft convention on
intermediary-held securities is on schedule, and the
aircraft protocol of the Cape Town Convention will come
into force on March 1, 2006, with Ireland, Malaysia and
Oman as the newest signatories.


3. Regarding the hiring of a Deputy Secretary General,
interviews were conducted and a candidate identified and
approved by the Governing Council. Though the new
candidate has not yet been named, post can confirm that
it is not Martin Stanford, the acting DSYG and principal
research officer. However, it is likely that the
Secretary General will name both Stanford and the new

SIPDIS
candidate as co-deputies, per his prerogative under
Article 8(2) of the UNIDROIT statutes (naming Stanford
co-Deputy Secretary General will have no impact on the
organization's budget). The SYG seemed pleased at the
number of high quality candidates, particularly
considering that the organization was only able to offer
a one-year guaranteed contract (specifics regarding the
reasons for the short-term contract, mainly related to a
one-time-only contribution from the UK with no provision
for out-years, are laid out in ref B).


4. Responding to a question from one member state, the
SYG began his presentation of the program of work for the
2006 08 triennium with an explanation of the
Institute's method of devising the program. He said the
Governing Council is responsible for drafting the
program, with assistance from the secretariat, only after
extensive consultation with member states (Note: it is
important to keep in mind that Governing Council members
serve in their own personal capacity as legal experts
rather than on specific behalf of member state
governments. End Note). Once a proposal is on the
table, it is evaluated against four basic criteria: is
there a need for such a project? Is it feasible to
complete the project within a specific time frame? Can
another organization do the job better? And finally, do
developing countries stand to gain from the project's
completion? For 2006 08, UNIDROIT will continue with
it's current work on the protocols and draft convention
mentioned above and will likely add a fourth protocol to
the Cape Town Convention regarding agricultural,
construction and mining equipment. In addition, there
are plans for the formation of a sub-committee on
registration for space assets, a space assets working
group meeting tentatively slated for September 2006, and
a public services questionnaire.


5. The budget for 2006, including a 3.1% increase in
expenditures, was approved by the GA as recommended by
the Finance Committee (ref A). This increase is almost
entirely attributable to the hiring of a new Deputy SYG
and will result in an increase in member state
contributions of approximately 1.25%. USDEL reiterated
the U.S. policy of zero nominal growth and, while
recognizing the need to hire a new Deputy SYG and
thanking the UK for their one-time contribution,
expressed concern for the years beyond 2006, for which no
provision has yet been made. This concern was echoed by
others. USDEL also confirmed U.S. interest in continuing
as a member of the Finance Committee and in fact secured
a seat for the 2006 08 triennium. Regarding arrears,
the Institute finds itself in a better position than at
any time over the last several years. Total arrears
stand at 186,000 euro after payments from Venezuela,
Colombia and Nigeria. In addition, Brazil committed to
clearing all of its arrears (a further 57,000 euro) by
December 31, 2005. USDEL applauded UNIDROIT for its
successful efforts, while cautioning that further
reductions are needed, particularly given the additional
expenses related to the hiring of a new DSYG.


6. There followed discussion and approval of a change to
Article 7 of the UNIDROIT statutes, which deals with
elections to the Governing Council. Member states
believed a change to the statutes was warranted after not
a single African representative was elected to the
Council at the November 2003 elections. An ad hoc
committee, formed to deal with the issue, met in February
2005 (ref C) and recommended to the GA a minimalist
guarantee of geographic representation by dividing the
world into four regions (Asia, Africa, Europe and the
Americas). Most interventions were favorable, though
many member states (including the U.S.) expressed concern
about the division into only four regions. Latin
Americans were particularly forceful in their desire to
be represented as a group and de-linked with North
America. USDEL also advocated periodic review of the new
formula.


7. Comment: the GA was attended by representatives of 37
nations. Besides those interventions already mentioned,
USDEL encouraged UNIDROIT on two fronts: first, to make
sure that work and strategic plans are aligned with the
resources available and that the Governing Council, which
does not deal directly with the resource question, is
aware of this and advocating with their member
governments on behalf of the Institute. Second, UNIDROIT
must do a better job of specifying to its member states
the real, tangible benefits of the treaties, conventions
and protocols it produces. Long buried in the legal and
intellectual details of its day to day work, UNIDROIT can
help itself by explaining how its end products will
directly affect the welfare of its member nations, which
will in turn offer increasing support to this underfunded
organization. End comment.

HALL