Partner Patrick Clancy (London-Finance) and of counsel Reade Ryan and Steven Sherman (both New York-Finance) have authored an article titled "Hague Securities Convention - The Right Way Forward" that has been published in the May 2017 edition of International Financial Law Review (IFLR).
The Hague Securities Convention provides uniform choice of law rules for certain rights relating to securities held, transferred and pledged by book entry in securities accounts at intermediaries. These rules are critical to the millions of transactions handled in this matter each year in today’s global economy. This article examines the new rules surrounding these choice of law rules, which have been in force since April 1, 2017 in the countries which have adopted this Convention: Switzerland, the United States and Mauritius. It is expected to be adopted by most other counties in due course. While this Convention’s rules rely primarily on the law of the account agreement, some practical issues relating to the common situation of securities held through a long chain of intermediaries (clearing systems, depositaries and custodians) still need to be ironed out.