In today’s global financial environment, where the great majority of securities are held in electronic form with third parties, international rules on proprietary rights have become needed. The rules governing such indirectly held securities (shares, bonds or other financial instruments) have been established through a worldwide agreement known as the Hague Securities Convention* and the Commission has proposed that the European Community becomes signatory to this international accord.
The Convention, which was agreed in December 2002 by 58 countries, including the US, Japan, Australia and all present EU Member States as well as seven accession countries, is the response to an urgent need in a large and growing global financial market to provide legal certainty and predictability regarding the law applicable to securities, particularly as they are increasingly taken as collateral in cross-border situations.
Specifically, the Convention aims at reducing legal risk, systemic risk and associated costs in relation to cross-border transactions involving securities held with an intermediary, with a view to facilitating the international flow of capital and access to capital markets.
The Convention will, once the Community is party to it, affect a number of existing EU Directives, such as the Collateral Directive (2002/47/EC) and the Settlement Finality Directive (98/26/EC) .
For further information | Pour plus d’informations | Für weitere Informationen: http://ec.europa.eu/internal_market/securities/hague/index_en.htm
*Hague Convention on the Law Applicable to Certain Rights in respect of Securities held with an Intermediary http://www.hcch.net/e/conventions/text36e.html
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