The Cape Town Convention on International Interests in Mobile Equipment, or Cape Town Treaty is an international

treaty A treaty is a formal, legally binding written agreement between actors in international law. It is usually made by and between sovereign states, but can include international organizations, individuals, business entities, and other legal pe ...

intended to standardize transactions involving movable property. The treaty creates international standards for registration of contracts of sale (including dedicated registration agencies),

security interest In finance, a security interest is a legal right granted by a debtor to a creditor over the debtor's property (usually referred to as the ''collateral'') which enables the creditor to have recourse to the property if the debtor defaults in makin ...

s (

lien A lien ( or ) is a form of security interest granted over an item of property to secure the payment of a debt or performance of some other obligation. The owner of the property, who grants the lien, is referred to as the ''lienee'' and the per ...

s),

leases A lease is a contractual arrangement calling for the user (referred to as the ''lessee'') to pay the owner (referred to as the ''lessor'') for the use of an asset. Property, buildings and vehicles are common assets that are leased. Industrial ...

and conditional sales contracts, and various legal remedies for default in financing agreements, including repossession and the effect of particular states' bankruptcy laws. Four protocols to the convention are specific to four types of movable equipment: Aircraft Equipment (aircraft and aircraft engines; signed in 2001), railway rolling stock (signed in 2007), space assets (signed in 2012) and "Mining, Agricultural and Construction Equipment" (signed in 2019). The aircraft Protocol entered into force in 2006, while the others are not in effect. The treaty resulted from a diplomatic conference held in

Cape Town Cape Town ( af, Kaapstad; , xh, iKapa) is one of South Africa's three capital cities, serving as the seat of the Parliament of South Africa. It is the legislative capital of the country, the oldest city in the country, and the second largest ...

South Africa South Africa, officially the Republic of South Africa (RSA), is the Southern Africa, southernmost country in Africa. It is bounded to the south by of coastline that stretch along the Atlantic Ocean, South Atlantic and Indian Oceans; to the ...

in 2001. The conference was attended by 68 countries and 14 international organizations. 53 countries signed the resolution proposing the treaty. The treaty came into force on 1 March 2006, and has been ratified by 57 parties. The Aircraft Protocol (which applies specifically to aircraft and aircraft engines) took effect on 1 March 2006 when it was ratified by 9 countries:

Ethiopia Ethiopia, , om, Itiyoophiyaa, so, Itoobiya, ti, ኢትዮጵያ, Ítiyop'iya, aa, Itiyoppiya officially the Federal Democratic Republic of Ethiopia, is a landlocked country in the Horn of Africa. It shares borders with Eritrea to the ...

Ireland Ireland ( ; ga, Éire ; Ulster Scots dialect, Ulster-Scots: ) is an island in the Atlantic Ocean, North Atlantic Ocean, in Northwestern Europe, north-western Europe. It is separated from Great Britain to its east by the North Channel (Grea ...

Malaysia Malaysia ( ; ) is a country in Southeast Asia. The federation, federal constitutional monarchy consists of States and federal territories of Malaysia, thirteen states and three federal territories, separated by the South China Sea into two r ...

Nigeria Nigeria ( ), , ig, Naìjíríyà, yo, Nàìjíríà, pcm, Naijá , ff, Naajeeriya, kcg, Naijeriya officially the Federal Republic of Nigeria, is a country in West Africa. It is situated between the Sahel to the north and the Gulf o ...

Oman Oman ( ; ar, عُمَان ' ), officially the Sultanate of Oman ( ar, سلْطنةُ عُمان ), is an Arabian country located in southwestern Asia. It is situated on the southeastern coast of the Arabian Peninsula, and spans the mouth of ...

Panama Panama ( , ; es, link=no, Panamá ), officially the Republic of Panama ( es, República de Panamá), is a transcontinental country spanning the southern part of North America and the northern part of South America. It is bordered by Co ...

Pakistan Pakistan ( ur, ), officially the Islamic Republic of Pakistan ( ur, , label=none), is a country in South Asia. It is the world's fifth-most populous country, with a population of almost 243 million people, and has the world's second-lar ...

, and the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...

Signatures and ratifications

As of 2018, the convention has been ratified by 77 states as well as the

European Union The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been de ...

. The railway rolling stock and the space protocols have been ratified by respectively three countries (Gabon, Luxembourg and Sweden), as well as the European Union, and no countries and thus have not taken effect. An overview of the status of the treaty and protocols is shown below:

European Union

The European Union joined the convention and the Aircraft Protocol as a Regional Economic Integration Organization. On the subject of the convention, both the Member states of the European Union and the Union itself have competence: e.g. while the substantive law regarding

insolvency In accounting, insolvency is the state of being unable to pay the debts, by a person or company ( debtor), at maturity; those in a state of insolvency are said to be ''insolvent''. There are two forms: cash-flow insolvency and balance-sheet ...

is regulated by the states, the conflict of law-rules (which county has jurisdiction etc.) is regulated by the European Union. According to the Government of the Netherlands the acceptance of the European Union in a member state which itself is not a party to the convention has no practical consequences. The European Union ratified the Luxembourg Rail protocol in December 2014 as a Regional Economic Integration Organization on the same basis.

Protocols

Aircraft Protocol

The ''aircraft Protocol'' (officially: ''Protocol to the Convention on International Interests in Mobile Equipment on matters specific to aircraft equipment'') was signed immediately with the treaty and the only protocol currently entered into force. It applies to aircraft which can carry at least eight people or 2750 kilograms of cargo, aircraft engines with thrust exceeding or , and helicopters carrying five or more passengers. The

International Registry of Mobile Assets International is an adjective (also used as a noun) meaning "between nations". International may also refer to: Music Albums * ''International'' (Kevin Michael album), 2011 * ''International'' (New Order album), 2002 * ''International'' (The T ...

established to record international property interests in the aircraft equipment covered by the treaty is located in Ireland. Mediation cases for leasing disputes are to be heard in the

High Court of Ireland The High Court ( ga, An Ard-Chúirt) of Ireland is a court which deals at first instance with the most serious and important civil and criminal cases. When sitting as a criminal court it is called the Central Criminal Court and sits with judg ...

. As of 2022, the protocol has 81 contracting parties, which includes 80 states and the

Railway Rolling Stock

The ''Railway Rolling Stock Protocol'', or ''Luxembourg Rail Protocol'', officially the ''Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Railway Rolling Stock'' was adopted on 23 February 2007 at a diplomatic conference in Luxembourg and applies to railway rolling stock (broadly defined as "vehicles movable on a fixed railway track or directly on, above or below a guideway"). The protocol establishes an international registry located in Luxembourg at which all international interests under the protocol will be registrable. The registry will also issue unique identifiers for rolling stock on request. Regulis S.A., a subsidiary of SITA, was appointed in November 2014 to act as Registrar. The protocol requires ratification by 4 countries, together with a certification by the secretariat to the Supervisory Authority that the registry is fully operational, in order to enter into force. Currently, it has been signed by France, Gabon, Germany, Italy, Luxembourg, Mozambique, Switzerland, Sweden, the UK as well as the European Union, while it has been ratified by the European Union and 3 states: Gabon, Luxembourg and Sweden.

Space Assets

The ''Space Assets protocol'', or ''Berlin Space Protocol'' (officially ''Protocol to the Convention on International Interests in Mobile Equipment on Matters specific to Space Assets'') was concluded on 9 March 2012 and requires 10 ratifications before entry into force. The protocol applies to objects functioning in space like satellites or satellite parts. The convention was strongly opposed by the satellite industry, claiming that it would lead to increased bureaucracy and "make the financing of new satellite projects more difficult and expensive". The convention has been signed by 5 countries (Burkina Faso, Germany, Saudi Arabia, United States and Zimbabwe), but no country has ratified it.

Mining, Agricultural, and Construction (MAC) Equipment

On 22 November 2019, a fourth protocol to the convention was adopted to extend the convention's framework to mining, agricultural, and construction (MAC) equipment, named ''Protocol to the Convention on International Interests in Mobile Equipment on Matters specific to mining, agricultural, and construction equipment''. The protocol was signed by 4 states (Congo, Gambia, Nigeria and Paraguay) upon its adoption and requires 5 ratifications before entry into force (provided the registry is operational then). On 1 October 2020, the United States of America signed the MAC Protocol and in 2022 the European Union bringing the total number of signatories to 6

References

Charles W. Mooney Jr. Charles ("Chuck") W. Mooney Jr. (born August 13, 1947) is the Charles A. Heimbold, Jr. Professor of Law at the University of Pennsylvania Law School, as well as the former interim Dean of the law school. Education and law practice Mooney was b ...

"Contract Practices under the Cape Town Convention
" The Legal Advisory Panel of the Aviation Working Group, Cape Town Papers Series, Volume I, 9 ''Uniform Law Review'' Issue 3, August 2004, Pages 703–04, . *Charles W. Mooney Jr., Marek Dubovec, William Brydie-Watson,
The mining, agricultural and construction equipment protocol to the Cape Town Convention project: The current status
" 21 ''Uniform Law Review'' 2–3, August 2016, Pages 332–60 {{Commercial air travel, state=collapsed ;Luxembourg Rail Protocol
Rail Working Group
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