Cape Town Convention

UNIDROIT's most important work in the field of Secured Transactions Law is the Cape Town Convention on International Interests in Mobile Equipment This was adopted by the international community at a diplomatic conference in Cape Town, South Africa on 16 November 2001. It presently has over 70 Contracting States and the support of 1 regional economic integration organisation. The Cape Town Convention system works by means of Protocols for specific industries. There are presently three Protocols to the Cape Town Convention with a fourth Protocol presently under development:

Aircraft Protocol

The Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment was prepared jointly by UNIDROIT and ICAO and was opened for signature to the international community in 16 January 2001. It presently has over 70 Contracting States and has entered into force since 1 March 2006. The Aviation Working Group is actively involved in the promotion and implementation of this Protocol.  

Rail Protocol

The Luxembourg Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Railway Rolling Stock was adopted at a diplomatic Conference held in Luxembourg on 23 February 2007. It has three Contracting States as well as the approval of the EU and 6 Signatories, with an increasing number of States highly interested in becoming a party to it. The Rail Working Group is also actively engaged in further developing and promoting this Protocol. 

Space Protocol

The Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Space Assets was adopted at a diplomatic Conference held in Berlin on 9 March 2012. It has 4 Signatories and is actively being promoted by UNIDROIT at various fora all across the world. The Space Preparatory Commission is also actively engaged in further developing and promoting of this Protocol to relevant States and members of the industry.  

MAC Protocol

The Fourth Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Mining, Agricultural and Construction Equipment is being developed by UNIDROIT and is expected to be completed in 2019. The Committee of Governmental Experts for this Protocol has met twice over the course of 2017 and has seen participation from over 50 States and various members of the MAC Industry represented by the MAC Working Group.  



09 Jan 2021

On 26 September 2020, Mr Hamza Hameed (Legal Consultant at UNIDROIT) delivered a presentation entitled ‘The Aircraft Protocol of the Cape Town Convention – Promoting growth in the aviation sector thro ...


22 Dec 2020

On 17 December 2020, UNIDROIT, in partnership with the U.S. Mission to the UN Agencies in Rome organised a panel discussion on ‘The Global Reach of the Cape Town Convention: The Potential for the Mini ...


14 Dec 2020

On 14-15 December 2020, UNIDROIT participated in the second meeting of the Group of Experts established by the United Nations Economic Commission for Europe (UNECE) for the Permanent Identification of ...

Cape Town Convention

The Convention on International Interests in Mobile Equipment (Cape Town Convention) has been regarded as one of the most impactful developments in commercial treaty law over the past 50 years and has the capacity to result in billions worth of economic benefits for contracting States. The Convention itself is an umbrella treaty furthered by Protocols relating to specific industries: 

The purpose of the Cape Town Convention and its various Protocols is to provide an international secured transactions regime applicable to the trade of high value, mobile, and uniquely identifiable equipment. The system functions through the creation of different international registries under each Protocol to enable the creation, registration, and enforcement of priority rights within assets of a registrable nature. This in turn adds an international guarantee to financiers within these industries towards their assets hence allowing them to lend with confidence and at lower rates. The primary objectives of the Cape Town Convention are:

  1. to facilitate the acquisition and financing of internationally mobile assets by creating rights recognised in all Contracting States;
  2. to establish an electronic registry of international interests which serves to give notice to third parties and ensures priority;
  3. to give creditors recourse to basic default and insolvency-related remedies designed to offer rapid relief;
  4. to ensure that the specific needs of an industry with respect to financing are met through various Protocols; and
  5. to give prospective creditors a greater degree of confidence when extending credit to borrowers.

Cape Town Convention Academic Project

The Cape Town Convention Academic Project seeks to assist scholars, students, practicing lawyers, judges and other government officials, and industry by providing information on and education about the Convention and its Protocols. The Project is a joint undertaking between the University of Oxford Faculty of Law and the University of Washington School of Law. The repository and journal are under the joint auspices of the Project and UNIDROIT. Learn more about the project by clicking the image below:


Aircraft Protocol


Designed specifically to facilitate asset-based financing and leasing of aviation equipment, the Aircraft Protocol of the Cape Town Convention expands financing opportunities available to entities looking to build their fleets, and reduces the costs associated with acquiring finance to do so, thereby providing substantial economic benefits for operators and the economies within which they function.

Advantages for aircraft financiers/lessors

For creditors, the Cape Town Convention and its Aircraft Protocol:
- Bring speed, certainty and cost savings to repossession, deregistration and export of aircraft objects in cases of debtor insolvency or default where the aircraft object is in a country whose laws would otherwise not be creditor-friendly;
- Protect creditors' interests in aircraft objects by providing for the registration of international interests in those aircraft objects at a single, web-based, International Registry that is open 24/7;
- Subjecting those interests to a simple priority regime whose main principles are that registered international interests beat unregistered ones; earlier registrations beat later registrations; and the parties can vary priorities by agreeing and (for increased protection) registering subordination arrangements at the International Registry.

Advantages for airlines/aircraft operators

For debtors, the Cape Town Convention and its Aircraft Protocol:
- Reduce the cost of borrowing and getting access to finance by providing a secure ecosystem for creditors to lend in;
-Broaden the options available for acquiring finance for aircraft objects by allowing lenders from different jurisdictions to securely invest worldwide;
- Create opportunities to upgrade to a more modern and cost effective fleet hence reducing the cost of doing business and increasing profit margins;
- Making it easier to compete with other players on the international market by creating an equally opportune system of financing;
- Allowing for greater security in the purchasing or leasing of second-hand or old aircraft objects.

Rail Protocol


The Luxembourg Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Railway Rolling Stock establishes a secured transactions regime for trade within the rail industry. It creates a new type of global security interest for railway rolling stock, internationally recognised with established priorities. This interest can be registered in an online public registry and creates a common system for enforcing creditor rights on debtor default or insolvency

Scope of the Protocol

– To all rolling stock (broadly defined) - “..vehicles movable on a fixed railway track or directly on, above or below a guideway” - covers:
– Inter-urban and urban rolling stock;
– Specialist boring equipment and other rail mounted equipment;
– Metro trains;
– People movers/shuttles at airports;
– Cranes at ports;
– Cable cars and trams


– Establishes a new domestic and international legal framework securing creditors;
– Eliminates complex documentation and structures – saving money;
– Resolves cross border and conflict of laws issues;
– Minimizes need for state support;
– Reduces private financing costs and, for exporters, ECA and political risk premiums;
– Facilitates operating and finance leasing and other private sector finance;
– Makes the industry more competitive against road and aircraft transportation.

Space Protocol

The Space Protocol of the Cape Town Convention is an international regime of secured transactions designed specifically for the space industry. It introduces a uniform and transparent scheme to improve creditors' rights and hence facilitating the flow of capital into the space sector. Based largely on the Aircraft Protocol of the Cape Town Convention, the Space Protocol has been adapted to specifically suit the needs of the space industry while respecting the public service aspect of space activities.

How does it work?

The Space Protocol creates a uniform regulatory regime for the recognition and protection of security interests in space assets. This ensures that issues such as conflict of laws or differing insolvency remedies, that are normally encountered in asset-based financing, are surpassed.

It provides uniform rules for the creation, registration and priority of legal interests in space assets, as well as facilitating expeditious and efficient enforcement of remedies in the event of a default or insolvency of the debtor. At the same time, it ensures that adequate protection is given to public services that are offered through space assets and that the same are not interrupted due to an immediate exercise of the creditor’s right.

Anticipated Benefits

- The creation of an international registry for space assets which will allow debtors and creditors to register international interests in space assets;
- The creation of a global system of internationally enforceable security interests in space assets;
- The provision of an ecosystem where financiers and investors can confidently give their money to companies in the space sector;
- The availability of an international regime onto which domestic laws can be based on in order to provide secured lending for the space industry.
- The ability for developing countries and emerging markets to develop their space industries.


MAC Protocol

The future fourth Protocol of the Cape Town Convention for Matters Specific to Mining, Agriculture and Construction Equipment (MAC Protocol) is one of UNIDROIT's most high priority projects at the present moment.

The development of the MAC Protocol has benefitted significantly from the involvement of the global MAC industries. The MAC Working Group, established in 2014, has 12 member companies, and organisations representing the interests of more than 10,000 companies doing business on six continents. This interest on behalf of the MAC industries validates the potential benefits which the MAC Protocol would accrue once it enters into force.


How does it work?

The MAC Protocol will work very    similarly     to the Aircraft Protocol such that it will create an international electronic registry which will allow creditors to protect their legal interests over high value MAC equipment, regardless of its location. The MAC Protocol provides uniform rules governing the creation, registration and priority of legal interests in MAC equipment, as well as facilitating expeditious and efficient enforcement of remedies in the event of a default or insolvency of the debtor. The types of interests which can be created are similar to those under the Aircraft Protocol as the definition of an international interest stems from Article 2 of the Convention and not any particular Protocol. Certain caveats are included to specifically cater to the requirements of the MAC industries such as an exclusion on interests over inventory.

The MAC Protocol will allow financiers to easily access more markets and provide credit globally at cheaper rates. This will allow end users of MAC equipment to gain greater access to capital hence bolstering their production and in turn, the economy of the State in which they function.

Anticipated Benefits

The current value of MAC equipment being traded annually exceeds 117 Billion USD. The MAC Protocol is expected to have an annual global economic impact of 32-48 Billion USD in developing countries and 36-50 Billion USD in developed countries.

It benefits the entire MAC sector such that all the entities involved will have increased access to modern MAC equipment at a lower cost; manufacturers will hence be able to increase their output; dealers will be able to export to new markets; and financiers will have more confidence in issuing credit.

Current Status and Future Developments
The MAC Protocol has presently undergone two meetings of its Committee of Governmental Experts over the course of 2017. UNIDROIT anticipates to have a Diplomatic Conference in 2019 to which all Member States of the UN will be invited.

Presently, there are opportunities to learn more about the legal rules being created and to understand their impact. Moreover, there is also a subgroup of the Committee of Governmental Experts reviewing the HS Codes to be included in the final draft of the MAC Protocol.


UNIDROIT Secretariat
Via Panisperna 28
00184 Rome, Italy
Tel: +39 (0)6 69 62 11
Fax: +39 (0)6 69 94 13 94

Connect with us on:

To access to documents of reserved area you should be logged.