At a New Delhi function marking the 50th anniversary of UNCITRAL, Cherie Blair QC gave a keynote speech on global standards for rules-based commerce. Here she has adapted her thoughts for our readers
As the core legal body of the UN for international trade, for five decades The United Nations Commission on International Trade Law (UNCITRAL) has focused on the modernization and harmonization of the rules of international business. Its considerable impact on international dispute resolution sees countries fashioning their arbitration legislation on its Model Law, and organizations globally relying on its rules and procedures to regulate their trading relationships and to settle disputes.
With the founding of the first regional office of UNCITRAL – the Regional Centre for Asia and the Pacific – in 2012, the region has seen a 47% increase in the number of states basing their arbitration legislation on the Model Law, from 15 to 22.
UNCITRAL was founded in 1966, a tumultuous year that also saw nine military coups d’état and four former British colonies gain independence. The world was divided between East and West, the Cold War raised the spectre of nuclear strikes and Vietnam served as a literal battleground between capitalism and communism. Trade with the Soviet Bloc was centrally controlled, with much of the region essentially closed off.
Acknowledging that national laws and national governments’ behaviours often hindered the flow of trade, UNCITRAL was given a mandate to reduce or remove such obstacles, unifying international trade. However, for this harmonizing experiment to succeed, it needed to navigate a divided world and forge a new understanding of how the world could work. The trend was positive as at this time nations were coming to terms with the fact that unbridled nationalism was inimical to the good functioning of states and the development of their people.
Nonetheless, the road from the supreme sovereignty of nations to a world where states give up some of their powers for the greater good was rocky. Reaction to UNCITRAL’s first programme of agreeing on a unified law on the international sale of goods, for example, was mixed. The then USSR criticized the fact that “only 28 states, of which only three are socialist and two developing states, participated in the 1964 Hague Conference”, and noted that the draft law did “not meet the requirements which the majority of states demand from international instruments of this kind”.
The draft law would eventually be agreed upon, as would dozens of others, irreversibly changing how business is conducted across borders. China’s ratification in 1986 of what became the Convention on Contracts for the International Sale of Goods coincided with large-scale Chinese reform and opening-up policies helping to provide a set of rules that ensured progress and rule-based trade. Today it is China’s and India’s growth and trade that drives the engine of the global economy.
This article is an adaptation of a keynote speech given by Cherie Blair QC, chair of law firm Omnia Strategy, at an UNCITRAL conference in New Delhi in November 2016 entitled Celebrating UNCITRAL’s 50 Years – Global Standards for Rules-based Commerce. Blair and Claire Kerschensteiner, an associate at Omnia Strategy, adapted the speech specifically for our readers.