Security Rights in Movables

14 Pages Posted: 19 Jan 2010

See all articles by Ulrich Drobnig

Ulrich Drobnig

Max Planck Institute for Comparative and International Private Law

Date Written: January 15, 2010

Abstract

Economies in contemporary developed countries largely depend upon credits for their financing. Credits, however, in most cases are granted only against security, encumbering either real estate (immovables) or movables. Since the volume and value of movables increases and these are much more widely available to both individuals and enterprises, the role of security rights in movables has correspondingly and steadily increased since the last quarter of the nineteenth century up to current times.

Legal regulation has, however, generally speaking, not kept pace with the increasing economic demand for security in movable assets. It is true that there are well established and widely accepted rules for one specific branch of security in movables, namely for possessory pledges. Due to modem economic demands, however, this particular branch has lost much of its earlier economic relevance. In our times, non possessory security in movables has become of overwhelming importance. Ironically, however, this branch is legally least developed and in this area legal development has been most varied between the various countries. The increasing importance of security rights is demonstrated by the fact that in 2006 France consolidated all civil law rules on personal and proprietary security in a new Book IV of its Civil Code.

The present contribution is limited to security rights created by contract. Non-contractual security rights, which may be created by statute or the law (liens) or also by judicial decision, are of much lesser importance. We will first deal with corporeal security. This may be possessory or non-possessory. A separate part will discuss incorporeal security, especially in accounts and other rights. The conclusion will be devoted to a recent academic proposal for rules in the Common Frame of Reference (CFR).

Keywords: Contract law, European private law, European civil code, security rights

Suggested Citation

Drobnig, Ulrich, Security Rights in Movables (January 15, 2010). Available at SSRN: https://ssrn.com/abstract=1537137 or http://dx.doi.org/10.2139/ssrn.1537137

Ulrich Drobnig (Contact Author)

Max Planck Institute for Comparative and International Private Law ( email )

Mittelweg 187
Hamburg, 20148
Germany

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