During its most recent regular
session (October 2016), the Inter-American
Juridical Committee (CJI) recommended adoption
of Principles for Electronic Warehouse
Receipts for Agricultural Products, a
topic that was included on its agenda in 2012
out of concern over the lack of access
to credit in the agricultural sector.
Warehouse receipt financing is
a form of asset-based lending where the stored
(“warehoused”) products are used as collateral,
which increases lender confidence in loan
recovery. Because producers receive needed cash
against the warehouse receipt, which is issued
as soon as the goods are delivered, they are no
longer forced to sell their farm products
immediately upon harvest and can delay sale
until prices are more favorable. Improved
performance of the agricultural sector
has been shown to be essential in many countries
as a way to stimulate economic growth
and development.
An effective warehouse
receipt system requires both a reliable network
of the physical infrastructure – (i.e., modern
warehouses) - and a supportive legal framework.
Accordingly, the CJI considered it important to
develop principles that would: a) promote a
reliable system of warehouse receipt financing;
b) compliment and strengthen other reform
initiatives in secured lending; c) apply equally
to both paper-based and electronic receipts; d)
straddle differences between common law and
civil law systems of warehouse receipts; and d)
contribute towards ongoing efforts in the
development of related international norms. In
this regard, the CJI acknowledged important work
in the field by the United Nations Commission on
International Trade Law (UNCITRAL), the Food and
Agriculture Organization of the United Nations
and European Bank for Reconstruction and
Development (FAO/EBRD) and the World Bank Group.
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For the report and text of the principles, see “Electronic Warehouse Receipts for Agricultural Products”, CJI/doc. 505/16 rev. 2 of September 27, 2016.
For further information on this matter, please contact the Department of International Law of the OAS – Technical Secretariat of the Inter-American Juridical Committee +1 202 370 0743.
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