On Introduction of Floating Charge

HUFS Law Review

@article{ART001292652},
author={ Ryu, Chang-Ho },
title={On Introduction of Floating Charge},
journal={HUFS Law Review},
issn={1226-0886},
year={2008},
number={32},
pages={297-332},
doi={10.17257/hufslr.2008..32.297},
url={http://dx.doi.org/10.17257/hufslr.2008..32.297}

TY - JOUR
AU - Ryu, Chang-Ho
TI - On Introduction of Floating Charge
T2 - HUFS Law Review
PY - 2008
VL -
IS - 32
PB - The HUFS Law Research Institute
SP - 297-332
SN - 1226-0886
AB - There is an amounting concern in Korea that the present charge system under which the debtor, the chargor, can't dispose of the charged assets in the ordinary of business without the consent of the creditor, the chargee, should be subject to reform. On the other hand, English courts have developed the law and theory of floating charge since 1870 when the case of Re Panama, New Zealand and Australian Royal Mail Company was decided. In order to get some lesson from english experience, this article explores into cases and materials of English floating charge. The essence of the floating charge is that the creditor, the chargee takes security over the debtor's present and future property but allows the debtor, chargor, liberty to manage the secured assets and dispose of them in the ordinary course of business free from the charge until its crystallization. As the floating charge enables the debtor to deal with his circulating assets freely in the normal course of business, it is indispensible to especially trading companies the most valuable assets of which aren't fixed ones but circulating ones, for example trading stock and receivables. There is an amounting need for non-possessory security interest over movables and the assignment of receivables financing, which could modify the rigidity of the current regime on secured transactions in Korea. By doing so, this type of new security would increase the availability of credit and improve the terms of the credit. But, the modernization and diversification of the collateral system in Korea should be promoted so as to implement the security interest on movables and receivables.
KW - Floating Charge, Crystallization, Floating Lien, Aggregate, Corporate Security
DO - 10.17257/hufslr.2008..32.297
UR - http://dx.doi.org/10.17257/hufslr.2008..32.297
ER -

Ryu, Chang-Ho (2008). On Introduction of Floating Charge. HUFS Law Review, 32, 297- 332.

Ryu, Chang-Ho . 2008, “On Introduction of Floating Charge”, HUFS Law Review, no. 32, pp. 297-332. Available from: doi:10.17257/hufslr.2008..32.297

Ryu, Chang-Ho “On Introduction of Floating Charge” HUFS Law Review 32 pp. 297-332 (2008): 297.

Ryu, Chang-Ho . On Introduction of Floating Charge HUFS Law Review [Internet]. 2008; 32: 297-332. Available from: doi:10.17257/hufslr.2008..32.297

Ryu, Chang-Ho . “On Introduction of Floating Charge” HUFS Law Review no.32 (2008): 297-332. doi: 10.17257/hufslr.2008..32.297

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On Introduction of Floating Charge

HUFS Law Review

Abbr : -

2008, no.32, pp.297 - 332

DOI : 10.17257/hufslr.2008..32.297

Publisher : The HUFS Law Research Institute

Research Area : Law

Ryu, Chang-Ho¹

¹아주대학교 / chryu@ajou.ac.kr

Number of citation : 2 View APA Style

ABSTRACT

There is an amounting concern in Korea that the present charge system under which the debtor, the chargor, can't dispose of the charged assets in the ordinary of business without the consent of the creditor, the chargee, should be subject to reform. On the other hand, English courts have developed the law and theory of floating charge since 1870 when the case of Re Panama, New Zealand and Australian Royal Mail Company was decided. In order to get some lesson from english experience, this article explores into cases and materials of English floating charge. The essence of the floating charge is that the creditor, the chargee takes security over the debtor's present and future property but allows the debtor, chargor, liberty to manage the secured assets and dispose of them in the ordinary course of business free from the charge until its crystallization. As the floating charge enables the debtor to deal with his circulating assets freely in the normal course of business, it is indispensible to especially trading companies the most valuable assets of which aren't fixed ones but circulating ones, for example trading stock and receivables. There is an amounting need for non-possessory security interest over movables and the assignment of receivables financing, which could modify the rigidity of the current regime on secured transactions in Korea. By doing so, this type of new security would increase the availability of credit and improve the terms of the credit. But, the modernization and diversification of the collateral system in Korea should be promoted so as to implement the security interest on movables and receivables.

KEYWORD

Floating Charge, Crystallization, Floating Lien, Aggregate, Corporate Security

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