Why States Should Adopt UFMCA

The Uniform Law Commissioners promulgated the Uniform Foreign Money Claims Act (UFMCA) to allow courts in the United States to accept or render judgments valued in a foreign currency. There are many reasons why the Uniform Foreign Money Claims Act should be adopted in every state.

Increased Need Due to International Claims. Foreign money claims are greatly increasing as more Americans participate in the global economy. Additionally, increased international travel also increases the number of personal claims in foreign money.

United States Role in Foreign Trade. Most of the United States' major trading partners allow judgments in dollars. The UFMCA will bring the United States in line with the international practice by allowing judgments in foreign money.

A Settled Payment Date. UFMCA endorses the payment day rule, which is used by most other countries for converting foreign money judgments into dollars.

A Fair Payment Date. The payment day rule meets the reasonable expectations of the parties involved and places the aggrieved party in the position it would have been in financially but for the wrong that gave rise to the claim.

A Fair Conversion to Dollars. The UFMCA establishes a fair conversion to dollars by using the bank spot rate as of the day of payment.

Allocation of Risk of Exchange Rate Fluctuation. UFMCA recognizes the rights of parties to agree upon the money that governs their relationship. In the absence of an agreement, the Act adopts the rule of giving the aggrieved party the amount to which it is entitled in its own money or the money in which the loss occurred.

Non-Adjudicated Claims. UFMCA also covers arbitration awards.

Uniformity. A lack of uniformity in the states in resolving foreign money claims stimulates forum shopping and creates a lack of certainty in the law. The rapid adoption of UFMCA will help to encourage and sustain the United States' leading role in international trade in the coming decades.