Secured Transactions System

The speed with which the commercial and consumer credit market operates accelerates the development of modern security regime. Since the promulgation of Article 9(Secured Transactions) of the Uniform Commercial Code ( UCC ), which isthe leading modal of the modern security law,Article 9 has broadly called theattention of scholars of various countries. The concepts and approaches contained in Article 9 are viewed by a growing number of legal reformers as the base for modernizing national secured transactions law of jurisdictions outside the USA. A few of these concepts and approaches appear to be influencing the development of international secured transactions law. This paper examines the secured transaction law in China and the primary focus is on Article 9 , UCC and the adoption of the Article 9 model in other countries.Part I reviews the traditional secured transactions law. The two chapters in Part I respectively address the secured transactions law and practice in the civil and common law . Further, I explore the developing track of secured transactions law that changed from possessory security to non-possessory, from restricted security to title financing, from typical security to non-typical security, and from unitary security device to various security devices.Part n analyzes Article 9 of the UCC (secured transactions) and the adoption of Article 9 model in other countries. The two chapters in this part respectively present the basic content of Article 9 and its influence in the world. The functional approachto characterization of secured transactions and a unitary concept of security, whichare the distinctive feature of Article 9, are attractive to scholars and legislators of other countries. This part mainly examines practice of Taiwan, Quebec and the member states of European Bank for Reconstruction and Development to adopt the Article 9 model in order to provide some experiences for secured transactions legislation in China.Part III examines and reconstructs secured transactions law in China. This part aims at searching for common rules in secured transactions law and emphasizes the role of tradition and policy choice during the legal transplanfation. Further, on the basis of examination of "the functional approach" in Article 9, I argues that China should adopt a unitary concept of security and the approaches to the regulation of secured transactions, but should not completely adopt its functional approaches. This part also analyzes the important issue in reconstruction of secured transactions law in China- "nutrients clausus" , then I put forward that secured transactions law in China should not only import the positive effects of freedom mechanism in private law, but also prevent the negative effect of that mechanism by the procedural requirement, in order to achieve the open-end situation which could accommodate any new personal property security device if only the new device is created by agreement and follows the procedure of attachment and perfection. To meet the need of financing and commodity circulation in market economic mechanism in China, China' s secured transactions law should possess the following characteristics: (1) security interest should be available (a)over all categories of personal property; (b) to secure all types of debts;(c)between all types of person; (2) the simple, efficient and low-cost perfection device by which a secured creditor may give public notice to theexistence of his security interest ; (3) the quick, efficient and low-cost enforcement bywhich security interest could be realized ; (4) the clear rules of priorities with respect to the relative rights of competing creditors and their debtors which are fair in most situation.Hereby, this paper has made the elementary examination of current secured transactions law in China and the relevant research on the attachment, perfection, effectiveness and enforcement issues of security interests. The legislation suggestion is also provided at the end of this paper.