Activities and Priorities Dept. Justice Private International Law 2007

2. MEDIUM PRIORITIES

a. Convention on the Use of Electronic Communications in International Contracts (UNCITRAL)

[73] The 2005 Convention on the Use of Electronic Communications in International Contracts removes obstacles to the use of electronic communications in the formation of contracts between parties located in different States. The Convention applies to business-to-business transactions, as contracts concluded for personal, family or household purposes are excluded. It recognizes the equivalence of paper and electronic communications between parties in the formation and performance of contracts.

[74] In addition to providing a legal framework for parties to international contracts, the Convention on Electronic Communications can also be applied to existing international conventions, such as the UN Convention on Contracts for the International Sale of Goods. States wishing to do so will ensure that existing conventions are adapted to electronic communications by allowing the Convention on Electronic Communications to apply to these texts. Similarly, in Canada, provinces and territories would be in a position to apply the Convention on Electronic Communications to conventions that have been implemented in their jurisdiction.

[75] Consultation with representatives of the Canadian Bar Association has indicated that there is a substantial degree of interest in this convention. The Department of Justice expects to submit reports to the ULCC in 2008 that will review the Convention in light of Canadian civil and common law and make recommendations as to its possible adoption by Canada.

[76] Action required in Canada: Determine the interest of provincial and territorial jurisdictions for the adoption of the Convention in Canada and, if warranted, prepare a uniform act to facilitate the implementation of the Convention in Canada.

b. Model Law on International Commercial Conciliation (UNCITRAL)

[77] In June 2002, UNCITRAL adopted the Model Law on International Commercial Conciliation drafted under the auspices of UNCITRAL Working Group II - International Arbitration and Conciliation. The Canadian delegation at the negotiation comprised Manon Dostie (Department of Justice Canada), Professor Guy Lefebvre (civil law expert) and Robert Cosman (common law expert).

[78] In August 2004, the ULCC approved a Working Group to draft a uniform act to enact the UNCITRAL Model Law on International Commercial Conciliation. The Working Group was composed of many federal, provincial and private practice experts. The Uniform Act on International Commercial Conciliation was adopted in 2005 by the ULCC, and is now recommended for adoption by jurisdictions. Nova Scotia has adopted the Commercial Mediation Act (2005 SNS, C. 36).

[79] Action required in Canada: Implement the uniform act.

c. Preliminary draft Protocol on Matters specific to Space Assets to the Convention on International Interests in Mobile Equipment (Unidroit)

[80] This draft Protocol takes into account the practicalities and particularities of the space industry and adapts the mechanisms set out in the Convention on International Interests in Mobile Equipment to it.

[81] The last session of the Committee of governmental experts took place in Rome, 25-29 October 2004. Several outstanding issues were identified at the session and States agreed to review these issues further as they were considered critical for the project to move forward. The issues related to the manner by which space assets could be identified for the purpose of registration under the Protocol and Convention. There were also discussions about the desirability and the extent to which public services should be excluded from the Protocol.

[82] The Department of Justice Canada initiated a public consultation on March 5, 2005 through the publication of a notice in the Canada Gazette (Notice No. DPI-U01, Canada Gazette Part I, March 5, 2005, p. 581). Comments received from stakeholders and other federal government departments and agencies will be used to establish the Canadian position for the next Session of governmental experts.

[83] Discussions are also ongoing at the Subcommittee of the United Nations Committee for the Peaceful Utilisation of Outer Space (UNCOPUOS). The Subcommittee discusses the role of the UN as a possible supervisory authority, the authority responsible for overseeing the registrar’s activities under the Convention and Protocol. A joint government/industry meeting on the draft protocol was organized by Unidroit and its Space Working Group in June 2007 in an effort to move the project along.

[84] Action required in Canada: Ongoing consultations on the Convention and the draft Protocol to develop the Canadian position for the next Unidroit session of governmental experts.

d. Review of Model Law on Procurement of Goods, Construction and Services (UNCITRAL)

[85] In 2004, UNCITRAL mandated a Working Group to work in the area of procurement. The purpose of the work is mainly to review the UNCITRAL Model Law on Procurement of Goods, Construction and Services from two perspectives: one concerns the use of electronic commerce in public procurement and the other consists of exploring new practices in order to enhance transparency and efficiency in public procurement.

[86] The Working Group met for three sessions over the last year, one from September 25-29, 2006, one from May 21-25, 2007, and the other from September 3-7, 2007. The Canadian delegation comprised representatives of the Department of Justice and the Department of International Trade and provincial experts in civil and common law. Canada was represented by Dominique D’Allaire and Mireille-France Blanchard, IPLS, Justice Canada, Eleanor Andres, Manitoba Justice, Colin G. Barker, Foreign Affairs and International Trade Canada, Marie-Andrée Gauthier, Justice Québec and Margaret-Amanda MacDonald, Ontario AG. The work is progressing on the four main work topics: (1) how to accommodate electronic procurement in the Model Law; (2) electronic reverse auctions; (3) abnormally low tenders; and (4) framework agreements.

[87] The Department of Justice’s Advisory Group on Private International Law has given a medium priority level to this project.

[88] Action required in Canada: Conduct consultations and establish the Canadian position for the upcoming session of the Working Group from April 7-11, 2008.

e. UNCITRAL Working Group on International Arbitration and Conciliation

[89] In 1999, the Commission mandated the Working Group on International Arbitration and Conciliation to examine four subjects: 1) conciliation; 2) requirement of written form for the arbitration agreement; 3) enforceability of interim measures of protection; and possibly 4) enforceability of an award that had been set aside in the State of origin.

[90] The Working Group examined the first three subjects. The Model Law on International Commercial Conciliation was adopted in June 2002. The Commission also adopted in June 2006 legislative provisions on the written form of the arbitration agreement and draft article 17 of the UNCITRAL Model Law on International Commercial Arbitration regarding the power of an arbitral tribunal to grant interim measures of protection including ex parte measures.

[91] At its 39th Session, the Commission agreed that the Working Group would consider revisions to the UNCITRAL Arbitration Rules adopted in 1976 to bring them up to current standards and practices.

[92] At its 45th Session in September 2006, the Working Group explored provisions that could require updates and introduced new issues, including transparency in the arbitral process and public access to hearings, consolidation of cases before arbitral tribunals; truncated arbitral tribunals, obstructing arbitrators, arbitrators’ fees and time-limits for rendering awards. Procedural issues, such as the desirability to have notices of intention to commence arbitration, were also raised. Overall, however, delegates were generally of the view that the Rules in their current form were adequate and responded to a variety of situations.

[93] At the 46th Session of the Working Group in February 2007, the first substantive meeting on revisions to the Rules, many issues were raised during discussions, including the following:

1. Whether the Rules should include a reference to the term “parties” as opposed to a reference to “parties to a contract” for the purpose of the scope of application of the Rules. A reference to the “parties” would ensure that disputes of a non-contractual nature and in the context of bilateral investment treaties would also be covered;

2. Whether the Rules should be extended to cover disputes “in respect of a defined legal relationship, whether contractual or not”;

3. Whether the writing requirement under the Rules should be modified to ensure arbitration clauses in electronic contracts are included;

4. Whether transparency for investor-state disputes should be required under the Rules; and

5. Whether there should be a provision on joinder of cases.

[94] In Canada, consultations were held by e-mail with stakeholders from our consultation group and will continue. These consultations have not revealed major concerns. The Working Group is meeting again in September 2007.

[95] Canada is represented by Dominique D'Allaire and by Natalie Giassa, Counsel, International Private Law Section, Justice Canada, Sylvie Tabet, Counsel, Trade Law Bureau, Justice Canada, Stephen L. Drymer, Ogilvy Renault, Montreal, Gerry W.J. Ghikas, Borden Ladner Gervais, Vancouver.

[96] Action required in Canada: Continue to consult with federal, provincial and territorial governements, private sector, academics, arbitration organizations and other interested parties; Explore provincial and territorial interest for the adoption of provisions on interim measures and preliminary orders in the International Commercial Arbitration Act, or any similar Act incorporating the UNCITRAL Model Law on International Commercial Arbitration in each jurisdiction.

f. CIDIP VII – Project on Electronic Registries for Secured Transactions (OAS)

[97] The electronic registries project results from the adoption of the Model Law on Secured Transactions by the CIDIP-VI and comprises three components: uniform registration forms, the development of electronic registry guidelines and the development of an instrument on registry interconnectivity. The first component to be studied by States is uniform registration forms. The OAS has prepared five model forms (registration, continuation, amendment, cancellation, and enforcement), all based on forms from Canada, the United States and Mexico

[98] In Canada, a Canadian working group on the electronic registries project has been set up, with experts in secured transactions law and in electronic secured transactions registries. The working group determined that it was not possible to provide comments on the forms without using some policy decision as a point of departure. It was agreed that Canada could usefully propose a draft policy outline that, if acceptable, would constitute the basis for the forms. The draft policy outline is currently the subject of discussions among the Canadian working group and has been shared with Mexico. It will be submitted to the OAS shortly.

[99] The Department of Justice’s Advisory Group on Private International Law has given a medium priority level to this project.

[100]Action required in Canada: Submit the draft policy outline to the OAS as a Canadian proposal.

g. CIDIP VII- Project on Jurisdiction and Law Applicable to Consumer Contracts (OAS)

[101] The Inter-American Specialised Conference on Private International Law (CIDIP) is considering consumer protection from the perspective of applicable law and court jurisdiction.

[102]Preliminary discussions took place among States and it became apparent that a certain number of States would rather work on a convention than a model law. Canada expressed a preference for the adoption of a model law and drafted a proposal based on the ULCC Uniform Jurisdiction and Choice of Law Rules for Consumer Contracts, 2004. Brazil has proposed a convention “on the law applicable to some consumer contracts and consumer transactions.

[103]From a Canadian perspective, the main difficulty with the proposal of Brazil is that it may lead to the application of more than one law to a given consumer contract and thus does not achieve certainty. We also doubt that a convention in this area could be successful since States are usually protective of their jurisdiction where consumers are concerned.

[104]The US has proposed a Model Inter-American Law on Availability of Consumer Dispute Resolution and Redress for Consumers. The proposal draws on the work of the OECD on consumer protection. It essentially promotes the creation of consumer protection agencies and the resolution of disputes between consumers and businesses by alternative means. The difficulty with this proposal is that the text appears to set out principles rather than legislative provisions.

[105]A preparatory meeting was held in Brazil in December 2006 to discuss the three proposals. Once the texts are considered to be sufficiently developed, the next CIDIP will be scheduled.

[106]Federal-provincial-territorial consultations will be ongoing.

[107]Action required in Canada: Continue consultations and prepare the Canadian position for the next CIDIP session for which a date is yet to be set.

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