Abstract
According to Glenn, the main reason why tradition is continuously studied is the constraint that tradition imposes on our lives. He further explains that what has been taken from the past is intrinsically normative; it therefore furnishes present lessons with respect to how we should act. Law is closely related to past information passed to the present. Law is an incessant and progressive process interpreting and crystallising the information through adapting it to current social environments. Law has its foundation upon what has been learned and accumulated generation by generation. Law is normative aggregate expression and composition of how human society has reacted to its past and present life.
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Notes
- 1.
H. Patrick Glenn, Legal Traditions of the World: Sustainable Diversity in Law, 3d ed. (Oxford University Press: New York, 2007) at 16.
- 2.
Ibid.
- 3.
More exactly, in Germany, dematerialised government debt securities issued in the name of CBF are viewed as constituting the collective securities bulk. See Chapter 3. III. A. 2.
- 4.
Cohen explains legal fictions as “the mask that progress must wear to pass the faithful but blear-eyed watchers of our ancient legal treasures. But though legal fictions are useful in thus mitigating or absorbing the shock of innovation, they work havoc in the form of intellectual confusion. The least that can be said is that they tend to make us all ignore the magnitude and character of the actual changes wrought by them.” (Morris R. Cohen, Law and the Social Order: Essay in Legal Philosophy (New Brunswick: Transaction Books, 1982=1933) at 126).
- 5.
Notably, in a recent presentation by Kronke to German banking lawyers, participants opined that they prefer the U.S. or Swiss models, which departs from the traditional property law model and adopts the concept of innovative statutory account securities. See Herbert Kronke, “Remarks on the Geneva Securities Convention’s Development and Its Future” in Louise Gullifer & Jennifer Payne, eds., Intermediated Securities: Legal Problems and Practical Issues (Oxford: Hart Publishing, 2010) at 250.
- 6.
A neighbouring country of Germany, the Netherlands, also implemented dematerialisation as of 1 January 2011, and plans to complete the dematerialisation by the end of 2013. Unlike France and Japan, however, the Dutch intermediated system dematerialises all individual securities certificates, except for global securities certificates. Since 1 January 2011, Euroclear Nederland, the Dutch CSD, no longer accepts individual securities certificates, and all Dutch issuers must issue securities in the form of uncertificated securities or one single global certificate. See Euroclear Netherland website at http://www.euroclear.com.
- 7.
Peter Norman, Plumbers and Visionaries: Securities Settlement and Europe’s Financial Market (Chichester: John Wiley & Sons Ltd., 2007) at 129~130 (stating that the key motive of implementing the full materialisation was taxation, not improvement of the financial market).
- 8.
See Rie Ishikawa, “Kabuken Deshika ga Kabunushi no Saikensha Tou ni Ataeru Eikyou” [Impact of Electronisation of Share Certificates upon Creditors of a Shareholder] (2010) 12 Deposit Insurance Review 143 for an introduction of an attachment case under the fully dematerialised Japanese intermediated system.
- 9.
Lehmann also objects to mandatory full dematerialisation. See Matthias Lehmann, Finanzinstrumente: vom Wertpapier- und Sachenrecht zum Recht der unkörperlichen Vermögensgegenstände (Tübingen: Mohr Siebeck, 2009) at 509~510.
- 10.
If the new statutory legal regime may explicitly disconnect account securities from their theoretical relationship with deposited securities certificates, and co-ownership and co-possession of the securities certificates, deposited securities certificates may not be destroyed. A possible option not to destroy deposited securities certificates is that right after delivering the certificates to the issuer by the CSD, the issuer requests the CSD to hold them in a separate jacket custody on its behalf. If so, at least in the intermediated system, there is no securities certificates constituting the commingled securities bulk; thus an internally dematerialised system may be constructed in a conceptual way. As mentioned, since in the proposed internally dematerialised intermediated system, it is expected that frequent destruction and new issuance of securities certificates will not occur, the final proposal herein is made based upon the internally dematerialised system which actually destroys deposited securities. However, the fundamental legal structures are the same in both options.
- 11.
Lehmann also mentions a similar point. See Matthias Lehmann, supra note 9 at 509.
- 12.
Broadly speaking, in the Information Age and the knowledge-based society, the main interest in the economy has moved from tangible objects to intangibles. Accordingly, it is questionable how existing legal rules and institutions developed based upon tangibles can be applied to intangible objects. An approach to addressing issues regarding intermediated securities could be a good example to cope with similar issues arising in other areas, such as insolvency law, commercial law, etc. Detailed discussions of this phenomenon, and suggestions for proper legal theories as to the conceptual shift from tangibles to intangibles, are beyond this work; but see e.g. Heribert Hirte & Béla Knof, “Das Pfandrecht an globalverbrieften Aktien in der Insolvenz” (2008) 2 WM 49 for the case of the possession concept of objects in German insolvency law (asserting that the concept of object should be functionally interpreted); Sebastian Mock, Finanzverfassung der Kapitalgesellschaften und Internationale Rechnungslegung (Köln: Carl Heymanns, 2007) for the concept of cash-generating units in the International Account Standard, a technical accounting concept of groups of tangible and intangible assets.
- 13.
As another option, as mentioned, it is suggested that when the CSD delivers deposited physical securities certificates to the issuer, the issuer requests the CSD to hold them in a jacket custody on its behalf. If so, there exist, at least in the intermediated system, no securities certificates constituting the commingled securities bulk. Accordingly, in this option, an internally dematerialised system may also be constructed in a conceptual way, without actual destruction of deposited securities.
- 14.
See Chapter 4. III. B. 3.
- 15.
As mentioned, as to government debt securities, if the central bank becomes a registration institution, and maintains a partial, separate book-entry transfer system, twin dematerialised intermediated systems can be operated.
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Chun, C. (2012). Chapter 10. Conclusions. In: Cross-border Transactions of Intermediated Securities. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-27853-2_11
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