Are your clients afraid to invest in certain parts of the world, afraid that the legal framework will not protect their rights? It may be time to start changing their minds. Model legislation from International Institute for the Unification of Private Law (UNIDROIT), an intergovernmental organisation based in Rome, may soon open many of these markets to the leasing investment critical to these regions’ – and your clients’ – growth.
In many emerging economies, uncertainty makes secured forms of investment all but impossible. Not only are many financial institutions hesitant to make the long-term commitment associated with such investments, but the necessary legal infrastructure is extremely complicated and the necessary registration system too expensive to merit attention at some stages of development. Organisations such as the European Bank for Reconstruction and Development and the World Bank are working hard to help countries implement the necessary framework, but in much of the world, real change is many years away.
