UNCITRAL, security rights and the globalisation of the US Article 9

Abstract

This article provides a critical analysis of the UN Commission on International Trade Law (UNCITRAL) proposals for developing – through its Legislative Guide (the Guide) – a 'liberal' global secured credit law regime that opens up the range of assets that can be used for securing loans and that limits formal procedures required for taking security interests. The article argues that UNCITRAL’s reliance on Article 9 of the US Uniform Commercial Code is problematic for various reasons. First, it neglects reference to indigenous secured credit law norms that also reflect national social policy choices in a range of countries. Second, it questions the idea that global 'liberal' secured credit law of the kind articulated in the Guide helps to achieve 'economic efficiency', since it relies on a narrow conception of private property. Moreover, by relying on existing property rights distributions, a liberal secured credit law can further entrench existing socio-economic disparities in a society. The article therefore casts doubt on the idea that UNCITRAL’s Legislative Guide is an example of a successful 'harmonized, modernized and marketized' secured credit law, and instead – in Polanyian terms – draws attention to its potential to further disembed markets in credit out of social relationships.