INTERNATIONAL: A global treaty designed to make it easier and cheaper for the private sector to finance railway rolling stock came into force on March 8.
The Luxembourg Rail Protocol to the Cape Town Convention on International Interests in Mobile Equipment is a treaty under the auspices of UNIDROIT, the International Institute for the Unification of Private Law.
It aims to increase the capital available by setting out a legal regime for the recognition and enforcement of the rights of lenders, lessors and conditional vendors. A similar protocol covering the aviation sector has been in operation for some years.
An International Registry of Interests in Rolling Stock managed by ISC company Regulis is now operational, and able to allocate Unique Rail Vehicle Identification System 16-digit numbers which will enable financiers to track their vehicles. It can also accept registrations of security interests and facilitate searches.
The protocol ‘opens up new possibilities for the private sector to provide much-needed and cheaper financing for railway rolling stock around the world’, said Howard Rosen, Chair of the Rail Working Group association which is focused on its adoption and implementation.
The protocol is endorsed by international rail organisations including OTIF, CIT, UIC, UIP, ERFA, AllRail, UITP, CER and Eurofima, and it is actively supported by the African Union, the UN Economic Commission for Africa and the UN Economic Commission for Europe.
It currently applies in Luxembourg, Gabon, Sweden and Spain. The European Union has ratified in respect of its competences, and South Africa and Paraguay are on course to ratify.
France, Germany, Switzerland, Mozambique, Italy and the UK have signed the protocol, and states including Kenya, China, Malta, Eswatini, Namibia, Senegal, Ethiopia, Finland, Ukraine and Mauritius are looking at adoption.
Entry into force ‘is an extraordinary achievement that supports urgently needed access to private credit for the rail industry’, said UNIDROIT Secretary General Ignacio Tirado. ‘The Luxembourg Rail Protocol has the potential to unlock enormous benefits for all stakeholders as its ratification rolls out around the world.’
Stadler recently joined the Rail Working Group. ‘However good our products are, our customers often need finance at sustainable rates before we can make the sale’, said Dr Ansgar Brockmeyer, Executive Vice-President Sales & Marketing at the Swiss manufacturer. ‘The protocol is good news for us as a leading manufacturer of rolling stock, and good news for the rail industry.’
