THE HAGUE, Jan 16 (Reuters) - A new tribunal for the resolution of disputes involving complex financial instruments opened in The Hague on Monday, a bid by the Netherlands to win more business in the financial and legal services sectors.
The Panel of Recognised International Market Experts in Finance - or PRIME Finance - is intended to settle disputes in the global financial markets, such as those arising from the collapse of Lehman Brothers in 2008 and the subsequent financial crisis.
Lord Woolf, the former Lord Chief Justice of England and Wales, and Nout Wellink, who was president of the Dutch central bank at the time of the financial crisis, are on the new tribunal's advisory board.
The panel's experts cover areas such as market practice, arbitration and mediation, and have worked at financial institutions, leading law firms, regulatory agencies and universities, specialising in derivatives, structured products, and collateralised debt obligations.
The Hague has a reputation as a centre for international justice, particularly in instances where crimes against humanity cannot be tried in their home countries. The city is already home to several world courts including the International Court of Justice, the International Criminal Court, and other war crimes tribunals,
But the Netherlands' position as an international financial centre was dealt a severe blow in the 2008 financial crisis, when the state had to stump up nearly 40 billion euros to rescue several financial institutions.
Leading bank ABN AMRO had to be nationalised while ING Groep is still in the process of repaying state funds.
The global crisis prompted some experts to call for a specialist tribunal to handle disputes arising from financial transactions involving more than one jurisdiction.
'The PRIME Finance project emerged against the backdrop of financial market crisis and legal uncertainty,' said Jeffrey Golden, a visiting professor at the London School of Economics and Political Science, who is on the panel's management board.
'The amounts at stake are staggering, the legal and contractual issues are complicated, and the volume of complex product cases is increasing,' he said in a statement.
Golden said that national courts and ad hoc arbitration have not yet been able to build a unified, authoritative body of law.
'Decisions are unpredictable, too decentralized, often taken too slowly, and not always enforceable in the parties' home jurisdictions.'
However, some legal experts consider it unlikely that investment banks and financial institutions in the United States and United Kingdom will want to try out a new tribunal, rather than use existing courts in New York or London with which they are already familiar.
(Reporting by Sara Webb. Editing by Jane Merriman) Keywords: FINANCE DISPUTES/
(sara.webb@thomsonreuters.com)(+31 20 504 5000)(Reuters Messaging: sara.webb.thomsonreuters.com@reuters.net)
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