Comparative Secured Transactions

Level: 
Master's
Course Status: 
Elective
CEU credits: 
2
ECTS credits: 
4
Module: 
III
Academic year: 
2009/2010
Academic year: 
2012/2013
Academic year: 
2013/2014
Instructor(s): 
Tibor Tajti

The course is a comparative survey of leading secured transactions laws (known also as: credit-securing law or personal property security law), one of the sine qua non branches of law of developed market economies. Additionally, this branch of law has been in the center of interest on the international scene since the fall of the Berlin Wall and underwent reforms on all continents.

The road map for the course is the following. In the introductory part, the relationship of credits – as one of the cornerstones of market economies – and collateral, the basic policy choices and the economic importance of secured transactions law and terminology will be focused upon. Then, a shift to the building blocks of the Uniform Commercial Code’s Article 9 (United States) – as the most influential national law to date – will ensue including the concepts of attachment and perfection (ostensible ownership and public notice), the priority system including purchase-money super-priority, the concept of floating lien as well as the various enforcement avenues.

Article 9 will thereafter be compared to English (representing the most influential yet “compartmentalized” common law system in Europe) and German (representing the non-registration-based yet developed alternative) laws, including the internationally renowned English fixed – floating charge tandem and the German “kautelarische Sicherheiten” (i.e., extended and expanded security transfers and retention of title). Adequate attention will also be devoted to the role bankruptcy and consumer protection laws play in secured transactions context.

In the second part of the course the emphasis will be on the peculiarities of various financing techniques and industries that rely on and “live from” secured transactions law (hence the designation ‘applied secured transactions’). In particular, title financing (conditional sale, leasing and hire-purchase), receivables financing, floor-plan financing, as well as use of investment property as security, subordination and project finance. In the last part, problems inherent to the conflict of secured transactions systems, international harmonization (i.e., the work of EBRD, UNCITRAL, UNIDROIT, the Washington D.C. based Law and Economics Center and the African O’HADA) and reform of secured transactions laws (e.g., post-1990s Central and Eastern Europe) will be dealt with.

It is one of the central aims to make the course useful to both practitioners and for those being more interested about the theoretical aspects of commercial law. Moreover, as the reform of this branch of law has already begun, or is imminent not just in Central and Eastern Europe but in other developing economies as well, the material to be covered should be valuable also for all those being connected with the transitory process in their respective countries.