Unit 14 International Financial Unit 14 International Financial LawLaw

Text I Law of International Finance-Text I Law of International Finance-Choice Choice of Law of Law

-To understand international -To understand international principles of choice of law in principles of choice of law in international finance contextinternational finance context

Text II Selected Clauses of Agreement of Text II Selected Clauses of Agreement of International Monetary Fund International Monetary Fund

-To have an overview of the -To have an overview of the AgreementAgreement

Typical Sentence Patterns: Courtroom Typical Sentence Patterns: Courtroom EnglishEnglish

Text I Law of International Text I Law of International Finance -Choice of LawFinance -Choice of Law

Useful expressions: bond issue, say (parenthesis), syndicUseful expressions: bond issue, say (parenthesis), syndicate, country of…, place of…, impinge on / upon, have rate, country of…, place of…, impinge on / upon, have recourse to, grasp at a straw, apace (adv.), ascertain thecourse to, grasp at a straw, apace (adv.), ascertain the law, off-shoot, family of law, be a long way from, tene law, off-shoot, family of law, be a long way from, tenet for, usury n. (usurious adj.), forfeiture (of loan), giveet for, usury n. (usurious adj.), forfeiture (of loan), given that…, on offer, have an edge in (bargaining power), n that…, on offer, have an edge in (bargaining power), as opposed to, part (v.) with, arbitral / arbitration tribuas opposed to, part (v.) with, arbitral / arbitration tribunal, meritnal, meritss, confer…on…, in suspense, be struck down,, confer…on…, in suspense, be struck down, evasive adj. (evade v., evasion n.), statutory limitation, evasive adj. (evade v., evasion n.), statutory limitation, devoid of, on ground(s) of/ that…, national prestige, a devoid of, on ground(s) of/ that…, national prestige, alien law, self-supporting, tacit / implied choice, policy ilien law, self-supporting, tacit / implied choice, policy interestnterest

Terms: international loan agreement, private internationTerms: international loan agreement, private international law, conflict of laws, corporate law, proper law, partal law, conflict of laws, corporate law, proper law, party autonomy, center of gravity, law of the forumy autonomy, center of gravity, law of the forum

Proper names: (Convention establishing) ICSID, EEC DrafProper names: (Convention establishing) ICSID, EEC Draft Convention on Obligationst Convention on Obligations

Questions based on Part IQuestions based on Part I

1.1. When does private international law When does private international law arise in international finance? arise in international finance?

2.2. What do you know about private What do you know about private international law?international law?

3.3. How does the text describe the How does the text describe the development of private international development of private international law?law?

4.4. Use the two-stage analysis to the 2 Use the two-stage analysis to the 2 examples provided in para.2 and examples provided in para.2 and para.5 respectively.para.5 respectively.

Questions based on Part II-endQuestions based on Part II-end

1.1. What is proper law and what law can be What is proper law and what law can be proper law?proper law?

2.2. What are the possible choices of law What are the possible choices of law related to an international loan agreement?related to an international loan agreement?

3.3. What is party autonomy, when does it What is party autonomy, when does it apply, what are the advantages of such a apply, what are the advantages of such a principle and what are the limitations on it?principle and what are the limitations on it?

4.4. What can the parties resort to in case of What can the parties resort to in case of dispute if no express choice of the proper dispute if no express choice of the proper law has been made?law has been made?

5.5. What is the status quo of international rule-What is the status quo of international rule-making in settling financial disputes?making in settling financial disputes?

Terms Terms private international law private international law 国际私法国际私法

--Chinese definition:Chinese definition: “That branch of law which re “That branch of law which regulates civil legal relations (in broad sense: compasgulates civil legal relations (in broad sense: compassing commercial relations) with foreign elements” sing commercial relations) with foreign elements” 调整带有涉外因素的民（商）事法律关系的部门法，又调整带有涉外因素的民（商）事法律关系的部门法，又称“涉外民法”称“涉外民法”

--By Graveson:By Graveson: “That branch of law which deals wi “That branch of law which deals with cases in which some relevant fact has a connectith cases in which some relevant fact has a connection with another system of law on either territorial oon with another system of law on either territorial or personal grounds, and may, on that account, raise r personal grounds, and may, on that account, raise a question as to the application of one’s own or tha question as to the application of one’s own or the appropriate alternative (usu. foreign) law to the de appropriate alternative (usu. foreign) law to the determination of the issue, or as to the exercise of juretermination of the issue, or as to the exercise of jurisdiction by one’s own or foreign courts.”isdiction by one’s own or foreign courts.”

-also known as “-also known as “conflict of lawsconflict of laws”” （冲突法）：（冲突法）： the the situation in which a certain civil legal relation with fosituation in which a certain civil legal relation with foreign elements involves the laws of 2 or more differereign elements involves the laws of 2 or more different legal units which conflict with each other.nt legal units which conflict with each other.

The private international law rules will point to The private international law rules will point to which country’s law shall apply to the given dispute.which country’s law shall apply to the given dispute.

structure of a conflict rulestructure of a conflict rule– 2 parts: category / class 2 parts: category / class （范围）（范围） and attributionand attribution （系属包（系属包

括连接点括连接点 connecting point / factorconnecting point / factor 和准据法和准据法 proper lawproper law ））– E.g. Ownership to immovablesE.g. Ownership to immovables is governed by is governed by the law of ththe law of th

e place where the property is situated.e place where the property is situated. 不动产依不动产所在地法。不动产依不动产所在地法。

TermsTerms proper lawproper law 准据法 准据法

-the applicable in an agreement-the applicable in an agreementparty autonomyparty autonomy 当事人意思自治当事人意思自治

-when concluding a contract, the parties have -when concluding a contract, the parties have certaincertain fr freedom to include in their contract a choice of law clauseedom to include in their contract a choice of law clause, by which they choose a law or a legal system to govere, by which they choose a law or a legal system to govern their agreement when disputes arise n their agreement when disputes arise

center of gravitycenter of gravity 最密切联系原则，法律之重心原则最密切联系原则，法律之重心原则law of the forumlaw of the forum 法院地法法院地法consumer financeconsumer finance -The most basic sense of the word refer -The most basic sense of the word refer

s to any kind of lending to consumers including loans frs to any kind of lending to consumers including loans from banks and indirect finance such as hire-purchase agom banks and indirect finance such as hire-purchase agreements, and loans by specialist retail finance companreements, and loans by specialist retail finance companies ies

International financeInternational finance is the branch of economics that stu is the branch of economics that studies the dynamics of exchange rates, foreign investment,dies the dynamics of exchange rates, foreign investment, and how these affect international trade and how these affect international trade

Additional questionsAdditional questions

1. What are the sources of private international law?1. What are the sources of private international law?

2. How to solve conflicts between laws?2. How to solve conflicts between laws?

3. What are the possible formulas of attribution3. What are the possible formulas of attribution （系属公式）？（系属公式）？

4. Can the contractual parties choose a proper law that has no 4. Can the contractual parties choose a proper law that has no connection with the contract?connection with the contract?

5. Can the contractual parties choose the arbitration tribunal a5. Can the contractual parties choose the arbitration tribunal and the arbitration rules in solving the contractual disputes?nd the arbitration rules in solving the contractual disputes?

6. What are the limitations imposed on party autonomy?6. What are the limitations imposed on party autonomy?

7. Do all the countries recognize contractual parties’ 7. Do all the countries recognize contractual parties’ implicit choice of proper law?implicit choice of proper law?

8. If contractual parties fail to choose the proper law o8. If contractual parties fail to choose the proper law or their intent is not clear enough, how do courts genr their intent is not clear enough, how do courts generally decide on the applicable law to the contract?erally decide on the applicable law to the contract?

9. Do you know any rules governing the application of 9. Do you know any rules governing the application of law to the economic contracts involving foreign intelaw to the economic contracts involving foreign interest in China?rest in China?

10. Do you know any international organizations invol10. Do you know any international organizations involved in the private international law and any internatved in the private international law and any international commercial arbitration tribunals?ional commercial arbitration tribunals?

Proper namesProper names

(Convention establishing) ICSID(Convention establishing) ICSID《（建立）解决投资争端国际中心（公约）》《（建立）解决投资争端国际中心（公约）》

EEC Draft Convention on ObligationsEEC Draft Convention on Obligations 欧共体义务公约草案欧共体义务公约草案

Text II Selected Clauses of Text II Selected Clauses of Agreement of International Agreement of International

Monetary FundMonetary Fund

Agreement of International Monetary FundAgreement of International Monetary Fund《《国际货币基金组织条约》国际货币基金组织条约》

-see the full text at -see the full text at http://www.imf.org/external/pubs/ft/aa/index.htmhttp://www.imf.org/external/pubs/ft/aa/index.htm

OverviewOverview

The International Monetary Fund was crThe International Monetary Fund was created in 1945 to help promote the health of teated in 1945 to help promote the health of the world economy. Headquartered in Washinhe world economy. Headquartered in Washington DC, it is governed by and accountable to gton DC, it is governed by and accountable to the governments of the 185 countries that mthe governments of the 185 countries that make up its near-global membership. ake up its near-global membership.

Historical originHistorical origin

The International Monetary Fund—also The International Monetary Fund—also known as the “IMF” or the “Fund”—was known as the “IMF” or the “Fund”—was conceived at a United Nations conference coconceived at a United Nations conference convened in Bretton Woods, New Hampshire, U.nvened in Bretton Woods, New Hampshire, U.S. in July 1944. The 45 governments represenS. in July 1944. The 45 governments represented at that conference sought to build a framted at that conference sought to build a framework for economic cooperation that would ework for economic cooperation that would avoid a repetition of the disastrous economic avoid a repetition of the disastrous economic policies that had contributed to the Great Depolicies that had contributed to the Great Depression of the 1930s. pression of the 1930s.

Main responsibilities (Main responsibilities (Art. I of the Art. I of the AgreementAgreement ))::

• promoting international monetary cooperatipromoting international monetary cooperation; on;

• facilitating the expansion and balanced growfacilitating the expansion and balanced growth of international trade; th of international trade;

• promoting exchange stability; promoting exchange stability; • assisting in the establishment of a multilaterassisting in the establishment of a multilater

al system of payments; and al system of payments; and • making its resources available (under adequamaking its resources available (under adequa

te safeguards) to members experiencing balate safeguards) to members experiencing balance of payments difficulties. nce of payments difficulties.

国际货币基金组织国际货币基金组织 (( 简介简介 ))

国际货币基金组织是政府间的国际金融组织。国际货币基金组织是政府间的国际金融组织。它是根据它是根据 19441944 年年 77 月在美国新罕布什尔州布雷顿月在美国新罕布什尔州布雷顿森林召开联合国和联盟国家的国际货币金融会议森林召开联合国和联盟国家的国际货币金融会议上通过的《国际货币基金协定》而建立起来的。上通过的《国际货币基金协定》而建立起来的。于于 19451945 年年 1212 月月 2727 日正式成立，日正式成立， 19471947 年年 33 月月 11日开始办理业务。同年日开始办理业务。同年 1111 月月 1515 日成为联合国的日成为联合国的一个专门机构，但在经营上有其独立性。至今，一个专门机构，但在经营上有其独立性。至今， IIMFMF 已有已有 185185 个成员。个成员。

IMFIMF 主要业务活动有：向成员提供货款，在主要业务活动有：向成员提供货款，在货币问题上促进国际合作，研究国际货币制度改货币问题上促进国际合作，研究国际货币制度改革的有关问题，研究扩大基金组织的作用，提供革的有关问题，研究扩大基金组织的作用，提供技术援助和加强同其它国际机构的联系。 技术援助和加强同其它国际机构的联系。

基金组织设基金组织设 55 个地区部门（非洲、亚洲、欧洲、个地区部门（非洲、亚洲、欧洲、中东、西半球）和中东、西半球）和 1212 个职能部门（行政管理、中央个职能部门（行政管理、中央银行业务、汇兑和贸易关系、对外关系、财政事务、银行业务、汇兑和贸易关系、对外关系、财政事务、国际货币基金学院、法律事务、研究、秘书、司库、国际货币基金学院、法律事务、研究、秘书、司库、统计、语言服务局）。其宗旨统计、语言服务局）。其宗旨 (Art. I)(Art. I) 是作为一个常是作为一个常设机构在国际金融问题上进行协商与协作，促进国设机构在国际金融问题上进行协商与协作，促进国际货币合作；促进国际贸易的扩大和和平衡发展；际货币合作；促进国际贸易的扩大和和平衡发展；促进和保持成员国的就业，生产资源的发展和实际促进和保持成员国的就业，生产资源的发展和实际收入的高水平；促进国际汇兑的稳定，在成员国之收入的高水平；促进国际汇兑的稳定，在成员国之间保持有秩序的汇价安排，防止竞争性的货币贬值；间保持有秩序的汇价安排，防止竞争性的货币贬值；协助成员国在经常项目交易中建立多边支付制定，协助成员国在经常项目交易中建立多边支付制定，消除妨成员国临时提供普通资金，使其纠正国际收消除妨成员国临时提供普通资金，使其纠正国际收支的失调，而不采取危害本国或国际繁荣的措施，支的失调，而不采取危害本国或国际繁荣的措施，缩短成员国国际收支不平衡的时间，减轻不平衡的缩短成员国国际收支不平衡的时间，减轻不平衡的程度。程度。