Conflict of Laws for Transactions in Securities Held Through Intermediaries

Abstract

The evolution of the modern system of securities holding through intermediaries poses particularly difficult conflict of laws issues. The traditional approach to conflict of laws suggests that the law governing a transaction in securities is determined by the location of the securities; yet under modern conditions it is difficult in practice, if not impossible in theory, to determine that location. A recent project of the Hague Conference on Private International Law has confronted these problems and devised a workable, modern approach. For any such project to succeed, lawyers must be willing to abandon traditional concepts of conflict of laws such as “lex situs” or “party autonomy.” Rather, lawyers must be willing to adopt an approach to conflict of laws that is responsive to the needs and realities of the modern system of securities holding through intermediaries. This Article explores some of the basic problems that must be confronted in that effort.