FLASHCARDS – Collaterals and Liens

FLOATING CHARGE

The new effective Civil Code does not allow for the establishment of a floating charge unlike the previous law.

TO CRYSTALLISE

If your company fails to repay the loan or goes into liquidation, the floating charge crystallises or becomes frozen into a fixed charge.

LIEN

The lien holder may seek satisfaction from the debtor’s assets prior to other creditors or persons having claims against the same debtor.

MORTGAGE

Mortgage is a type of burden on real property.

PLEDGE

The subject of a pledge may only be personal property.

FIXED CHARGE

Fixed charge can be tied to tangible assets, such as buildings or equipment, as well as intangible assets, such as trademarks or patents.