I. 2 The Hague Convention This Convention, concluded at The Hague in December 2002 under the presidency of Professor Struycken and with Professor Stefania Bariatti as Chair, deals with the law governing the proprietary effects of the holding and transfer or pledge of securities through a custodian or other intermed iary rather than directly from the issuer. Under trad itional conflict of laws rules, issues relating to the transfer of securities are governed, in the case of registered securities, by the law of the place where the issuer is incorporated or alternatively securities held through an account with an intermediary, since the root of title is not the register or the physical location of bearer securities but the securities account with the ntermediary, and the law best suited to determine proprietary issues is the law of the place of business of the relevant intermediary. This place of the relevant intermediary'approach (PRIMA)is already embodied in a restricted way in Article 9(2)of the EC Settlement Finality Directive. What the Hague Convention does is to extend the concept, in modified form, to the international plane and in a relatively unrestricted way. The principal modification is that, to promote predictability, the law governing proprietary issues, whether as between the parties or in relation to third-party rights and priorities, will be that selected by the account holder and the intermed iary to govern the account agreement. This is subject to a so-called reality test, which in essence requires that the selected law is that of a state or territorial unit of a State in which the intermediary carries on the business of maintaining securities accounts, though without necessarily maintaining the particular account in question in that State Though the Hague Convention is very much shorter than the Cape Town Convention and a good deal less complex, it nevertheless raised a host of difficult issues stemming in no small measure from the wide diversity of institutions and practices involved in the securities industries in different countries. Yet the Convention was concluded a mere 2/ years after work first began, an astonishing achievement. The existence of a major problem was quickly established. In world financial centres, dealings in securities may amount to billions of dollars every night. It is therefore of vital importance to the parties to know what law governs proprietary issues. Yet apart from the conflict rule in Article 9(2)of the EC Settlement Finality Directive, which is of limited application, and decrees in Belgium and Luxembourg where the two international central securities depositories, Euroclear and Clearstream, are respectively based there are few national laws laying down clear conflict rules L. 3 The ingredients of success What can we learn from the working methods adopted in the preparation of these instruments? I would identify four crucial factors (1)The avoidance of excessive ambition It is better to have a limited target that is achievable than a grand design that is not. Three factors are common to the five conventions to which I referred earlier. First, they are confined to commercial transactions, because consumer transactions are already highly regulated and strongly overlaid with mandatory laws. Second, they are limited to cross border transactions, because it is primarily in international trade that problems of differencesI.2 The Hague Convention This Convention, concluded at The Hague in December 2002 under the presidency of Professor Struycken and with Professor Stefania Bariatti as Chair, deals with the law governing the proprietary effects of the holding and transfer or pledge of securities through a custodian or other intermediary rather than directly from the issuer. Under traditional conflict of laws rules, issues relating to the transfer of securities are governed, in the case of registered securities, by the law of the place where the issuer is incorporated or alternatively keeps its register and, in the case of bearer securities, by the lex situs of the certificates at the time of the transfer in question. These rules do not, however, work well in the case of securities held through an account with an intermediary, since the root of title is not the register or the physical location of bearer securities but the securities account with the intermediary, and the law best suited to determine proprietary issues is the law of the place of business of the relevant intermediary. This ‘place of the relevant intermediary’ approach (PRIMA) is already embodied in a restricted way in Article 9(2) of the EC Settlement Finality Directive. What the Hague Convention does is to extend the concept, in modified form, to the international plane and in a relatively unrestricted way. The principal modification is that, to promote predictability, the law governing proprietary issues, whether as between the parties or in relation to third-party rights and priorities, will be that selected by the account holder and the intermediary to govern the account agreement. This is subject to a so-called ‘reality test’, which in essence requires that the selected law is that of a state or territorial unit of a State in which the intermediary carries on the business of maintaining securities accounts, though without necessarily maintaining the particular account in question in that State. Though the Hague Convention is very much shorter than the Cape Town Convention and a good deal less complex, it nevertheless raised a host of difficult issues stemming in no small measure from the wide diversity of institutions and practices involved in the securities industries in different countries. Yet the Convention was concluded a mere 2½ years after work first began, an astonishing achievement. The existence of a major problem was quickly established. In world financial centres, dealings in securities may amount to billions of dollars every night. It is therefore of vital importance to the parties to know what law governs proprietary issues. Yet apart from the conflict rule in Article 9(2) of the EC Settlement Finality Directive, which is of limited application, and decrees in Belgium and Luxembourg, where the two international central securities depositories, Euroclear and Clearstream, are respectively based, there are few national laws laying down clear conflict rules. I.3 The ingredients of success What can we learn from the working methods adopted in the preparation of these instruments? I would identify four crucial factors: (1) The avoidance of excessive ambition It is better to have a limited target that is achievable than a grand design that is not. Three factors are common to the five conventions to which I referred earlier. First, they are confined to commercial transactions, because consumer transactions are already highly regulated and strongly overlaid with mandatory laws. Second, they are limited to cross￾border transactions, because it is primarily in international trade that problems of differences