Similar to the Aviation Working Group, the Rail Working Group ("RWG") is also a non-profit association focused on the rail industry, which is based in Switzerland. RWG was established in 2008 as per the request of UNIDROIT (International Institute for the Unification of Private Law) to represent the rail industry when adopting and implementing the matters relating to railway rolling stock of the Luxembourg Protocol ("Protocol") to the Cape Town Convention on International Interests in Mobile Equipment ("Convention").
More about the Rail Working Group
RWG had an observer status both at the Cape Town Diplomatic Conference adopting the Convention and the Luxembourg Diplomatic Conference, which adopted the Protocol and it also was involved in the drafting phase of both instruments. Today, the RWG has a growing worldwide membership of key rail stakeholders, including a number of rail and transport associations, and operates in numerous number of countries (Belgium, Denmark, France, Germany, India, Italy, Luxembourg, Malta, Mexico, North American countries, South Africa, South-East Asian countries, Spain, Switzerland and United Kingdom) with the contact groups in order to work closely with governments and industry stakeholders on their country's ratification process. RWG regularly attends and organizes conferences, seminars on rail sector and issues newsletters, articles etc. on the topics regarding the Protocol. It was established commissions, concerning the implementation of the Luxembourg Protocol in the areas of Ratification, Finance, Communications and Marketing, EU/European Organizations, Economic Impact and Intergovernmental Organizations and Registrar, in order to improve their worldwide activities.
RWG's main objective
RWG's objective is to ensure that the Protocol is brought into force in as many countries as possible while ensuring that the operation of the Protocol does not lose touch with the commercial realities of the rail industry. RWG works in cooperation with the companies in the rail industry, governments and government agencies to raise awareness of the proposed Protocol and to promote its adoption in order to encourage the private sector of capital investment in railway rolling stock. RWG states that the private sector finance is the key element to give effect and then expand the rolling stock procurement in the rail industry. Moreover, the RWG underlines the fact that adequate and internationally applicable security systems are essential to encourage more private investment in rail industry. RWG has been supporting the application of the Convention to all railway rolling stock through the adoption of the Protocol and encouraging the rail industry to sign and ratify the Protocol.
What about the International Rail Registry?
The Protocol covers all debtors located in the contracting states, for example in a financial center, regardless of the location of the railway equipment. It ensures the financing of the railway equipment through leases, secured credit agreements and conditional sale contracts. In addition to that, the Protocol creates a new global legal system for the recognition and prioritization of security interests held by creditors in railway equipments. By virtue of the International Rail Registry ("Registry"), such interests will be registered in a new international registry, which is searchable by the public 24/7. This makes it possible, for the first time, for all interested parties to easily learn of a creditor's security interest, and for the creditor to be able to enforce its security in the events of a debtor's default or insolvency.
The first registry system built by the Convention was the International Registry for Aircraft Equipment ("IR"). Since it started operations in 2006, there have been over 595,000 registrations with the IR; covering 110,000 aircraft objects with an estimated value of over a half trillion USD. The Registry is aiming to pursue the success of the IR. Similar to the IR, once the online registration system takes place, Registry is going to operate entirely online to allow financiers and their advisers the ability to register their international interests in mobile equipment and search for such interests. When establishing the Registry, its structure and functions are being created in line with the Convention and according to the needs of the rail industry.
The Registry is Just Around the Corner
Although the fundamental operation of the Registry is similar to the IR, which was designed for aircraft, there is one big difference between them since each locomotive, carriage or wagon is treated as a separate unit when registering the rail rolling stock with the Registrar. By the nature of the rail industry, around six million train units are waiting to be registered, which is a number greater than the aircraft units. Considering the foregoing facts, the infrastructure and the technologic capacity of the Registry have to be adequate to meet the size of the needs of the market. Therefore the Registry is not functional yet. However, a corporation called Regulis SA, a subsidiary of Société Internationale de Télécommunications Aéronautiques ("SITA") (Aviareto, the operator of the International Registry for aircrafts, is also a subsidiary of SITA), was established in Luxembourg in 2014 with the sole purpose of developing and operating the Registry pursuant to the Convention and the Protocol. Hopefully, the Registry will become operational soon and improve the rail sector just like the International Registry did in the aviation industry.