Saudi Arabia Signs UN Convention on International Effects of Judicial Sales of Ships

Beijing, September 05, 2023, SPA -- The Kingdom of Saudi Arabia has signed the draft UN Convention on the International Effects of Judicial Sales of Ships, also known as the Beijing Convention on the Judicial Sale of Ships, being at the forefront of countries to sign this convention that aims to establish a system that makes the judicial sale of ships internationally effective, while preserving the domestic legislation that regulates judicial sale procedures.
The Cabinet authorized the minister of commerce and chairman of the National Competitiveness Center, or a deputy, to sign the UN Convention on the International Effects of the Judicial Sales of Ships, at its session held on August 29, 2023.
Vice Minister of Commerce and CEO of the National Competitiveness Center Dr. Eman Al-Mutairi signed today the convention in Beijing.
The convention seeks to ensure legal certainty as to the title that the purchaser acquires in the ship as it navigates internationally. The basic rule of the convention is that a judicial sale conducted in one state party which has the effect of conferring clean title on the purchaser has the same effect in every other state party.
The convention regime prescribes additional rules which establish how a judicial sale is given effect after completion. The first is a "requirement that the ship registry deregisters the ship or transfer registration at the request of the purchaser". The second is a "prohibition on arresting the ship for a claim arising from a pre-existing right or interest (i.e., a right or interest extinguished by the sale)". The third is the "conferral of exclusive jurisdiction on the courts of the state of judicial sale to hear a challenge to the judicial sale".
The Kingdom signed the convention after examining the topics discussed by Working Group VI of the United Nations Commission on International Trade Law (UNCITRAL), in which the Permanent Coordinating Committee, chaired by the National Competitiveness Center (NCC) and the membership of the ministries of foreign affairs, justice, commerce, investment, transport and logistic services, the Small and Medium Enterprises General Authority (Monsha'at), the Saudi Center for Commercial Arbitration and the Bankruptcy Commission took part.
The committee is concerned with facilitating communication between the Kingdom of Saudi Arabia and UNCITRAL and its working groups, as well as with cooperating with government agencies to create a commercial legal environment in the Kingdom, in line with approved international best practices.
The Beijing Convention on the Judicial Sale of Ships, adopted by UN General Assembly in December 2022, applies only between the state parties and is not an alternative for other foundations to enforce judicial sales for the state parties.
--SPA