As a natural follow-up from the Legal Guide on Contract Farming (finalised in 2015) and the Legal Guide on Agricultural Land Investment Contracts (finalised in 2020), the Legal Structure of Agricultural Enterprises (LSAE) is the most recent project of the tripartite partnership between the International Institute for the Unification of Private Law (UNIDROIT), the Food and Agriculture Organization of the United Nations (FAO) and the International Fund for Agricultural Development (IFAD).
The LSAE project was selected by the UNIDROIT Governing Council, at its 98th session (Rome, 8-10 May 2019) and approved by the General Assembly at its 78th session (Rome, 12 December 2019) to be developed during the 2020-2022 Work Programme.
In 2020, as a first step for the development of the LSAE project, the Secretariat conducted a stocktaking exercise and feasibility study to ascertain whether UNIDROIT could make a useful contribution. On the basis of the preliminary research conducted, the Secretariat reported back to the Governing Council at its 99th session and confirmed the lack of international guidance to best streamline supply chain relationships (see UNIDROIT 2020 – C.D. (99) B.5). The Secretariat also drew the Council’s attention to the strong interest identified, in particular from economists, of undertaking work on the private law aspects of legal structure of agricultural enterprises to: (i) improve market access; (ii) improve forms of coordination of agricultural enterprises; (iii) ease access to critical resources and insurance; and (iv) address unfair commercial practices.
In 2021, on 15 and 16 April, the Secretariat co-organised a Consultation Webinar with FAO and IFAD to gather further input on the topics that could be potentially covered in the Guidance Document. The conclusions and recommendations of the Webinar were presented at the 100th session of the Council which agreed with the Secretariat’s proposal to upgrade the status of the LSAE project to allow for the establishment of a Working Group and to permit the allocation of resources for experts to continue the delineation of the scope and content of the prospective Guidance Document (see paras. 65-80, UNIDROIT 2021 – C.D. (100) B.24). The General Assembly supported the recommendation by the Governing Council, allocating high priority status to the LSAE project at its 80th session in December 2021.
On 9 and 10 December 2021, the Secretariat organised an informal exploratory meeting with a core group of experts to identify the topics and questions that needed to be further developed in an annotated issues paper for discussion during the first session of the Working Group.
The first session of the LSAE Working Group took place in Rome at the seat of Unidroit and via videoconference from 23 to 25 February 2022. The second session is schedules for 2-4 November 2022.
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The Consultation Webinar was held online on 15 and 16 April 2021 and served as a brainstorming session to inform the drafting of an annotated list of possible topics to be addressed in a prospective future instrument. The Consultation included five different sessions respectively focusing on:
Focusing on the legal and business aspects of agricultural enterprises, the Webinar brought together 35 speakers and over 150 registered participants from a wide diversity of backgrounds including practitioners and academics; representatives of international organisations; as well as representatives of the private sector, NGOs and think tanks.
For more information on the Consultation Webinar:
As consistent with UNIDROIT’s established working methods, the members and observers of the Working Group were identified by the UNIDROIT Secretariat, in consultation with the FAO and IFAD. The experts were selected for their legal expertise in the field of contract law, corporate law, commercial law, property law, and agricultural law, as well as for their experience in economics, finance, digitalisation and sustainability.
The Working Group is chaired by the Governing Council member Justice Ricardo Lorenzetti (Justice at the Supreme Court of Justice of Argentina) and coordinated by Professor Fabrizio Cafaggi (Judge at the Council of State Italy and Professor at the University of Trento and LUISS)
The Working Group also counts with the participation of representatives of the FAO and IFAD legal departments and technical experts from other departments. A significant number of observers, representing international and regional intergovernmental organisations, farmers associations, non-governmental organisations, and the private sector have also been invited to join the Working Group, among which the following:
1st Working Group Meeting
The first meeting of the LSAE Working Group took place in a hybrid manner on 23-25 February 2022.
2nd Working Group Meeting
The second meeting of the LSAE Working Group is scheduled for 2-4 November 2022.