Global shipping bodies, BIMCO and the International Chamber of Shipping have recently welcomed the entry into force of the UN Convention on the International Effects of the Judicial Sale of Ships (the “Beijing Convention”).
The bodies made their announcement in may although entry into force took place in mid-February this year.
However, this Convention is based on the concept of reciprocity i.e. it has effect between ratifying states only so it will be necessary for as many countries as possible to ratify the Convention.
The Convention establishes a harmonised regime for giving international effect to judicial sales (i.e. sales ordered by a court). A buyer of a ship from a judicial sale will be granted “clean title” eliminating the likelihood that buyers could face arrests, liens or maritime claims in other jurisdictions.
“This gives comfort to purchasers of ships and their financiers encouraging higher participation in judicial sales, increasing the sale proceeds which will then be distributed among creditors,” the ICS and BIMCO sid, adding that the Convention includes safeguards in respect of due process for the benefit of ship owners, mortgagees, and others.
The International Maritime Organization acts as the repository for notices and certificates of judicial sale under the Convention. These are open for consultation by accessing the IMO’s Global integrated Shipping Information System.
