LEGAL COMMITTEE RECOMMENDS ADOPTION OF CONVENTION ON INDEPENDENT GUARANTEES AND STAND-BY LETTERS OF CREDIT

9 November 1995
GA/L/2886

LEGAL COMMITTEE RECOMMENDS ADOPTION OF CONVENTION ON INDEPENDENT GUARANTEES AND STAND-BY LETTERS OF CREDIT

9 November 1995

Press ReleaseGA/L/2886

LEGAL COMMITTEE RECOMMENDS ADOPTION OF CONVENTION ON INDEPENDENT GUARANTEES AND STAND-BY LETTERS OF CREDIT

19951109 Also Approves Drafts on Work of UNCITRAL

The General Assembly would adopt the United Nations draft convention on independent guarantees and stand-by letters of credit and open it for signature or accession, by the terms of a 23-Power draft resolution on that topic -- approved without a vote in its Sixth Committee (Legal) this afternoon.

By the draft -- one of four approved this afternoon -- the Assembly would recognize the uncertainty and lack of uniformity prevailing in that financial field and express the conviction that adoption of the convention would overcome the problem and facilitate the use of such instruments.

By the terms of a 47-Power draft resolution on the work of the United Nations Commission on International Trade Law (UNCITRAL), the Assembly would commend that body's work on the draft Model Law on Legal Aspects of Electronic Data Interchange and Related Means of Communications and welcome its decision to commence work on the subjects of receivables financing and cross-border insolvency.

The representative of the Russian Federation spoke on that draft.

The General Assembly would bring the draft articles on the diplomatic courier and diplomatic bag not accompanied by diplomatic courier to the attention of Member States by the terms of a draft decision approved on that subject.

By another draft resolution approved this afternoon, the General Assembly would decide to delete article 11 from the statute of the Administrative Tribunal of the United Nations while continuing to apply any judgements made by the Tribunal prior to 1 January 1996.

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Also this afternoon, the Sixth Committee continued its analysis of the report of the Special Committee on the Charter and on the Strengthening of the Role of the Organization. Statements were made by the representatives of Poland, Hungary, Austria, Democratic People's Republic of Korea, Nigeria, Indonesia, Venezuela, United Kingdom, Mozambique, Guyana, Russian Federation and Israel.

Japan, the Democratic People's Republic of Korea and the Republic of Korea spoke in right of reply.

When it meets again at 10 a.m. tomorrow, 10 November, the Sixth Committee will continue discussing the report of the Charter Committee.

Committee Work Programme

The Sixth Committee (Legal) met this afternoon to consider four draft resolutions on draft articles on the diplomatic courier and diplomatic bag not accompanied by diplomatic courier; the review of the procedure provided for under article 11 of the Administrative Tribunal of the United Nations; the report of the United Nations Commission on International Trade Law (UNCITRAL) on the work of its twenty-eighth session; and another UNCITRAL draft on the United Nations Convention on Independent Guarantees and Stand-by Letters of Credit.

A draft on the diplomatic courier and diplomatic bag (document A/C.6/50/L.2), introduced by the Chairman, would have the Assembly decide to bring the draft articles on that subject developed by the International Law Commission to the attention of Member States, together with observations made during debate in the Sixth Committee.

The Chairman's draft on the article 11 Procedure (document A/C.6/50/L.3) would have the Assembly decide to delete article 11 and to continue to apply any judgements made by the Tribunal prior to 1 January 1996.

The Assembly would note that the procedure provided for under article 11 of the statute of the Administrative Tribunal of the United Nations has not proved to be a constructive or useful element in the adjudication of staff disputes within the Organization, and would stress the importance of ensuring a fair, efficient and expeditious internal system for the United Nations, including effective mechanisms for the resolution of disputes.

A 47-Power draft on UNCITRAL (document A/C.6/50/L.4) would have the Assembly commend the Commission for its work on the draft Model Law on Legal Aspects of Electronic Data Interchange and Related Means of Communications and welcome its decision to commence work on the subjects of receivables financing and cross-border insolvency.

The Assembly would reaffirm the mandate of the Commission, particularly as regards training and technical assistance for developing countries, and would express support for the Commission's sponsorship of seminars and symposia. It would appeal to governments to contribute to the Trust Fund for Travel Assistance to Developing Countries that are members of the Commission, and would decide to continue its consideration of granting travel assistance, within existing resources, to least developed countries which are members of the Commission.

The Assembly would request the Secretary-General to ensure that adequate resources were allocated for the programme of the Commission and urge States to sign, ratify or accede to conventions emanating from the work of UNCITRAL.

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The resolution is sponsored by Albania, Algeria, Argentina, Australia, Austria, Azerbaijan, Belgium, Bolivia, Bosnia and Herzegovina, Botswana, Brazil, Bulgaria, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Ecuador, Egypt, Finland, France, Germany, Greece, Guatemala, Honduras, Hungary, India, Italy, Kenya, Mexico, Morocco, Myanmar, Nigeria, Norway, Peru, Poland, Portugal, Singapore, Slovak Republic, Spain, Sweden, Thailand, Turkey, Uganda, Uruguay and Venezuela.

A 23-Power draft resolution on the United Nations draft convention on independent guarantees and stand-by letters of credit (document A/C.6/50/L.5) would have the General Assembly adopt the draft convention and open it for signature or accession. The Assembly would express appreciation for the preparation of the convention and call on governments to consider becoming party to it. The text of the convention is contained in an annex to the draft.

The Assembly would state that it was aware of the uncertainty and lack of uniformity currently prevailing in the field of independent guarantees and stand-by letters of credit, and that the adoption of the convention would contribute to overcoming that problem and to facilitating the use of such instruments.

The draft is sponsored by Australia, Austria, Bosnia and Herzegovina, Canada, Croatia, Czech Republic, Denmark, Ecuador, Finland, France, Guatemala, Honduras, Hungary, Italy, Norway, Portugal, Singapore, Slovak Republic, Spain, Sweden, Thailand, United Kingdom and the United States.

The Sixth Committee will also continue consideration of the Report of the Special Committee on the Charter of the United Nations and on the Strengthening of the Role of the Organization (document A/50/33). At its 27 February to 10 March session, the Special Committee approved recommendations dealing with the question of the deletion of the "enemy State" clauses from the Charter, the Committee's membership, assistance to third States affected by the application of sanctions under Chapter VII of the Charter and Model Rules for the Conciliation of Disputes between States. (For detailed background see Press Release GA/L/2882 of 6 November.)

Report of Charter Committee

MAREK MADEJ (Poland) said his Government had at the last session initiated the draft resolution on deletion of the "enemy State" clauses from the Charter. The fiftieth anniversary of the United Nations was also the fiftieth anniversary of the end of the Second World War. The time had come to remove from the Charter those provisions which were organically and exclusively linked with that war and with its immediate legal and political consequences.

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Poland hoped that the General Assembly would express its intention to initiate amendment of the Charter with a view to deleting the "enemy State" clauses, he said. The amendment should take place as soon as possible without any unjustified delays. He looked forward to seeing the Charter freed of obsolete provisions which were not applicable.

ANDRE ERDOS (Hungary) said his Government had always scrupulously observed and implemented enforcement measures taken by the Security Council under Articles 41 and 49 of the Charter, but those measures had resulted in considerable damage to the Hungarian economy. As one of the countries most affected by sanctions applied against the Federal Republic of Yugoslavia (Serbia and Montenegro), Hungary was not satisfied with the present application of Charter provisions regarding third States affected by Chapter VII sanctions. There was no foolproof method that would ensure the effective and timely imposition of sanctions while providing a full remedy to affected third States.

He supported adoption of the United Nations Model Rules for the Conciliation of Disputes between States, stating that the rules offered a flexible approach which took into account existing provisions of other multilateral instruments in that field.

The "enemy State" clauses should be removed from the Charter because they had been rendered obsolete, he said. Those against which the clauses were directed had become full-fledged Members of the United Nations and had greatly contributed to the implementation of the purposes and principles of the Charter.

On the matter of opening the Charter Committee to all Member States, he said that ample opportunity had always been given to any non-member of the Committee fully to participate in its work as an observer. He was not totally convinced that the proposed formula would promote efficiency. The conversion of the Special Committee on the Charter into an open-ended body could not be construed as a precedent for similar subsidiary organs of the General Assembly or of other United Nations organs.

GERHARD HAFNER (Austria) said that to avoid any duplication, the items relating to the maintenance of international peace and security should be seen in the context of the ongoing discussions in other forums of the United Nations. He was pleased that work on the draft United Nations Model Rules for the conciliation of disputes had reached a stage where they could be submitted to the General Assembly for adoption. Generally speaking, his delegation could endorse the resolution, though he could imagine some improvements to those Rules.

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Model Rules could contribute to further fragmentation and disintegration of international law and to the proliferation of instruments relating to the peaceful settlement of disputes, he continued. However, such proliferation was only a reflection of the fragmentary and disintegrated nature of international law itself. As long as that situation prevailed, the realization of any central judicial body called to decide all kinds of disputes had to be considered unrealistic. Taking into account that the advantages of the Model Rules outweighed possible shortcomings, he supported the proposal.

Speaking about the proposal for a dispute settlement service, he said that certain additional clarifications were still required before a position could be taken.

Since the deletion of the "enemy State" clauses did not change existing patterns of relations between States, he joined those who favoured the inclusion of that amendment in the larger context of reform of the Charter.

CHOE TONG U (Democratic People's Republic of Korea) said it was regrettable that the report of the Special Committee had referred to the draft resolution concerning the deletion of the "enemy State" clauses. Those clauses could never become automatically obsolete simply because time had passed since the adoption of the Charter. Deletion was an unjustifiable act which disregarded the fundamental issue relating to international peace and security and encroached upon the sovereignty of "a dignified UN Member State".

Heinous crimes committed by an "enemy State" against humankind still remained unresolved, he continued. It was preposterous to try to mislead the public opinion. "Even today, when half a century has passed since its defeat, Japan has neither admitted nor liquidated her crime-woven past and leaves no stone unturned to seek the membership of the principal organs of the United Nations by removing the brand of the 'enemy State' without any difficulty in a disguised manner typical of Japanese style", he said.

Whenever issues were raised with regard to the past crimes, he said, Japan alleged that those issues had already been settled in accordance with so-called "treaties", and that compensation had been made by a bilateral agreement, or a claim for compensation had lost its validity. His country would never accept such allegations.

Despite all the facts, he said, certain countries associated themselves with Japan by taking an unjust attitude towards "individual countries which oppose the deletion of the 'enemy State' clauses, saying that the issue is a political one to be resolved bilaterally".

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It was true that Japan was rich and therefore made some contributions to the United Nations, he said. However, that could neither relieve nor acquit Japan of its crimes. If money were regarded as the main factor, the principles of justice and impartiality would remain "empty talk", and small and poor countries would be in a position of bystanders to United Nations activities. The Organization should handle all international political and legal matters on the basis of the principles of objectivity, impartiality and democracy.

I.E. AYEWAH (Nigeria) said the principles and objectives of the Charter were as relevant today as they had been when the Organization was formed. The Special Committee sought to ensure transparency, accountability and efficiency in the United Nations. Consideration of the questions of representation and an increase in the membership of the Security Council and the revitalization of the General Assembly now being handled in other working groups could benefit from the Special Committee's input.

He supported the recommendation that the Committee henceforth be open to all Member States and that the "enemy State" clauses be deleted from the Charter.

Regarding assistance to third States affected by sanctions, he said that the objective of sanctions should not be punitive. Sanctions should be designed to modify the behaviour of governments. Measures should be taken before sanctions were imposed to prevent unnecessary suffering of the population. Effective machinery should be established to ensure an adequate and timely response to requests for assistance by afflicted third States, including the establishment of a trust fund.

He said that the proposal on enhancing the effectiveness of the Security Council and strengthening the role of the United Nations deserved consideration during the 1996 session of the Special Committee. The completed text of the United Nations Model Rules for the conciliation of disputes between States would contribute to the further development of the mechanism of prevention and peaceful settlement of disputes.

SAMODRA SRIWIDJAJA (Indonesia) said that profound changes on the international scene and the expectations placed on the Organization made it imperative to undertake a serious review and reappraisal of the Security Council's membership. Although the membership of the Organization had increased three-fold, there had been no proportionate increase in the permanent and non-permanent membership of the Council. The process of reforming Council membership should be undertaken with caution as it impinged upon some of the Organization's functions and purposes and should take into

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account objective criteria based on the principle of equitable geographical representation. It might also be appropriate to undertake a constructive review of the veto power in line with the comity of nations aimed at bringing about greater democratization and transparency in all United Nations bodies.

In recent years, he said, there had been a sharp increase in the application of sanctions, making clear the need for a durable solution to the question of assistance to affected third States. Many issues needed to be clarified prior to the imposition of sanctions including their time-frame, a definition of objectives, humanitarian aspects and special provisions to minimize the collateral damage suffered by third parties.

Indonesia appreciated the United Nations Model Rules for the Conciliation of Disputes between States submitted by Guatemala, he said. The Rules would be a worthy contribution to international law.

MILAGROS BETANCOURT (Venezuela) said that the problems of third States affected by Chapter VII sanctions imposed by the Security Council deserved urgent attention due to the dramatic increase in the use of sanctions. A practical and equitable solution must be found to those problems. New machinery should be developed, based on the urgent need for redress.

She said the draft United Nations Model Rules for the Conciliation of Disputes between States could be useful in providing non-binding guidance based upon the agreement of States. The proposal by Sierra Leone for the creation of a dispute-settlement service also deserved attention.

Venezuela endorsed the initiative to remove the obsolete and inapplicable "enemy State" clauses from the Charter, she said. She also favoured full participation of all States in the work of the Charter Committee.

ELIZABETH WILMSHURST (United Kingdom) said that Model Rules for the Conciliation of Disputes were among the successes of the Special Committee this year. They should prove of assistance to those States which in the future decided to adopt the method of conciliation for dispute settlement. The other success was the recommendation that the so-called "enemy State" clauses of the Charter be deleted. The draft resolution dealt appropriately with the manner and timing of their deletion.

The question of third States affected by the application of sanctions imposed under Chapter VII of the Charter had not received substantive consideration by the Committee, in view of the lack of documentation, she said. She associated fully with the statement made on that matter by the representative of Spain on behalf of the European Union.

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The Special Committee had also considered the question of its own membership, she said. The Committee should henceforth be open to all Member States of the United Nations and should continue to operate on the basis of consensus. She also suggested that the Repertoire of the Practice of the Security Council and the repertory of the practice of United Nations organs be continued, for both were extremely valuable research tools.

Regarding other proposals before the Committee, she said that her delegation remained to be convinced that the United Nations was in need of yet another mechanism for dispute settlement.

EDUARDO J.B. KOLOMA (Mozambique) said the Secretary-General's report contained two sets of proposals aimed at minimizing the effects of sanctions against third States and at providing assistance to those States. It was worthwhile to assess the potential impact of sanctions on potentially affected States, to monitor the effects of sanctions, improve working methods and ensure the transparency of the procedures of the Security Council and the sanctions committees.

He saw merit in establishing guidelines for the consideration of applications for assistance and said international and bilateral economic assistance should be considered, as well as the establishment of a permanent mechanism to explore ways of assisting States and to evaluate claims submitted under Article 50 of the Charter. Both sets of the suggested measures should be complementary to the establishment of a trust fund aimed at alleviating the negative impact of sanctions on the economies of third States. The international community should share the burden.

Now that the membership of the United Nations had more than tripled, he said, it was imperative that the membership of the Security Council should be expanded in order to make it more representative. Equitable geographical representation should also be taken into account. The Council should become more transparent and democratic.

He supported the deletion of the "enemy State" clauses and said that the amendment procedure should be undertaken as an integral part of the broad process of reform of the Charter. He welcomed the recommendation that the Special Committee be open to all Member States, but said there should be consistency in the approach to similar situations in subsidiary organs or bodies of the General Assembly. The Model Rules for the settlement of disputes between States represented an important contribution to the maintenance of international peace and security.

SONIA ELLIOTT (Guyana) said the Security Council should carry out consultations with third States affected by the imposition of Chapter VII sanctions. Such consultations should also extend to States likely to be affected. Since States had their legal basis in the United Nations Charter,

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the question of compensation needed to be addressed. The establishment of a United Nations trust fund should be seriously considered.

The United Nations Model Rules for the Conciliation of Disputes between States and the proposal to establish a dispute settlement service would both increase the options available to States for the peaceful settlement of conflicts, she said. Further means of utilizing the possibilities provided for by Article 33 of the Charter, and greater use of the International Court of Justice for disputes susceptible to legal resolution should be considered.

As a small State, Guyana attached great importance to the Charter's cardinal principle of sovereign equality among nations. That principle should be applied to the membership of the Security Council. The Council should be expanded to take full account of that principle and of the growth in the Organization's membership over the past three decades.

ILYA ROGACHEV (Russian Federation) said that the Security Council took action to maintain international peace and security mindful of the impact of sanctions on third States. The Council always had to act expeditiously. Balancing its need to act rapidly and responsibly was the central challenge before the Council. His Government favoured the establishment of clear-cut procedures for consultations between the Council and potentially-affected third States. Those States should not become victims; they should be compensated for their losses. Third States should know -- even before the imposition of sanctions -- what were their possibilities for compensation. Evaluation of the impact of sanctions on third States should be made by the Secretary-General based upon objective information.

The measures proposed to increase transparency in the work of Security Council sanctions committees should be articulated by clearly set-out procedures, including actions to be taken under Article 50 of the Charter, he said. The problem of assistance to third States could not be adequately resolved in isolation from other security issues. There was an urgent need to continue work on that topic in the Special Committee on the Charter.

The United Nations Model Rules on the Conciliation of Disputes between States should be adopted by the General Assembly, he said. As to the "enemy State" clauses, any decision should be taken by consensus. The objective should be to bring the Charter into line with present-day realities.

HEMDA GOLAN (Israel) expressed appreciation for the progress made since last year with regard to the Model Rules. Those flexible, non-binding rules would be in some cases a useful addition to existing arrangements, she said. The elimination of "enemy State" clauses should not be dealt with separately, but should be viewed as an integral part of the broader process of reforms to the Charter examined by the General Assembly.

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She said that the principles of the sovereign equality of States and the universality of the United Nations had not been fully implemented within the United Nations system, as far as Israel was concerned. Elections within the United Nations were generally based on geographical distribution in accordance with quotas allocated to every regional group. Israel had for many years been prevented from being a member of a regional group and, for that reason, had been unable to enjoy its full rights and assume all its duties as a Member State. The Special Committee should consider alternative systems which would permit truly universal representation in United Nations organs and bodies.

Right of Reply

NOBUKATSU KANEHARA (Japan), speaking in exercise of the right of reply, said that 50 years had passed since the founding of the United Nations, and the Charter had prevailed throughout that time. Many nations had joined the Organization's efforts to realize the ideals of the Charter. The former "enemy States" were no exception.

The nations of the world had struggled together and had achieved enormous progress through unprecedented international cooperation, he said. Trust, partnership and responsibility were the essential bases of the United Nations. Japan welcomed the conclusions reached by the Special Committee on the Charter that the "enemy State" clauses were obsolete and should be deleted.

HONG JE RYONG (Democratic People's Republic of Korea), also speaking in exercise of the right of reply, said that the representative of Japan had made clear that his Government was still trying to hide its past crimes. Japan seemed to intend to commit the same crimes again. It had sought to divert public opinion and avoid responsibility for past crimes. Japan had said that States should trust one another; since Japan had failed to admit its crimes, how could nations trust it?

The people of both Koreas -- and the people of the world -- would never tolerate the heinous crimes against mankind committed by Japan until Japan accepted responsibility for them, he said. The Sixth Committee was considering the creation of an international criminal court, and the elimination of the "enemy States" clauses. That seemed contradictory.

Both Germany and Japan had been enemy States, but up to now only Japan had refused to acknowledge its crimes, he said. The "enemy State" clauses should remain in place until Japan "liquidated its past".

Mr. KANEHARA (Japan) said that it was not appropriate to discuss matters unrelated to the deletion of the "enemy States" clauses.

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HAN TAEK LIM (Republic of Korea) said that the representative of the Democratic People's Republic of Korea had made mention of his country. No country could represent the views of any other country. The Republic of Korea did not acknowledge the right of anyone to speak on its behalf.

Mr. RYONG (Democratic People's Republic of Korea) said that the representative of the Republic of Korea should "feel ashamed" of his statement.

Mr. LIM (Republic of Korea) said that his Government would reserve the right to intervene on that topic in the future.

Mr. RYONG (Democratic People's Republic of Korea) said that he had not meant to represent the views of the Government of the Republic of Korea, but the views of the people of Korea -- North and South.

Action on Drafts

Mr. HAFNER (Austria), introducing the draft resolutions on the report of the United Nations Commission on International Trade Law (documents A/C.6/50/L.4 and L.5), said that his country had taken the initiative to coordinate the elaboration of the resolution relating to the work of UNCITRAL. Progressive harmonization and unification of international trade law was unthinkable without the work of the Commission, which ensured that legal obstacles to the free flow of international trade were removed. All categories of countries could benefit from those efforts.

SERGUEI M. TARASSENKO (Russian Federation) commenting on the draft resolution on the report of UNCITRAL, noted with satisfaction that UNCITRAL's work yielded important results in international trade. The draft was very timely, especially for countries with economies in transition, which were in the process of reforming their national legislation with a view to their integration in the international market. That had been pointed out both in the report of the Commission and in the statements made in debate. However, that point had not been clearly made in the draft resolution. Without wishing to undermine the consensus on the resolution, he wished to state that such issues were important.

The drafts were approved without a vote.

TYGE LEHMAN (Denmark), Sixth Committee Chairman, introduced the draft decision on the draft articles on the status of the diplomatic courier and the diplomatic bag not accompanied by diplomatic courier, and the draft resolution on the review of the procedure provided for under article 11 of the statute of the Administrative Tribunal of the United Nations (documents A/C.6/50/L.2 and L.3). The drafts were approved without a vote.

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For information media. Not an official record.