Study On The Fluidity Contract

The fluidity contract refers to the agreement between the creditors and debtors that, according to the legal procedure, if the debtor can't liquidate when the liquidation period expires, the creditors will have the title of the collateral in impawn and mortgage of real estate and movable property. This ancient and innovative system is absolutely prohibited by our Real Law which still followed the old system. In the process of drafting the Real Law, there had been an intense argument that the fluidity contract should be valid or invalid. An invalid opinion that the prohibition of the fluidity contract is in favor of the protection of the interests of creditors, preventing the loss of state-owned property, and the fluidity contract is against to the nature of security real right. The major arguments of the party to insist effective are that the fluidity contract is in line with the market economy, securing the required efficiency and convenient; embodying the principle of autonomy; inheriting the traditional real right idea. The fluidity contract is also the requirements of the convergence of law. Looking at Germany, Japan, France, the United States and other major foreign legislation, the opinion of invalid has been popularly criticized. The idea of admitting the fluidity contract has gradually become the mainstream. Theoretically and practically, some countries have affirmed the effectiveness of the fluidity contract. Admitting the effectiveness of fluidity contract is the development trend of real law.The parties themselves are the best measure of who benefits. By the parties in the framework of law to determine its own matters are the embodiment of the principle of autonomy. However, in order to avoid excessive imbalances in the interests of the parties, it is necessary to introduce legal mechanisms. In order to avoid creditors benefiting on others' insecurity, invalidation and cancellation system in Contract Law and General Principles of Civil Law can be used. In order to avoid damaging the interests of other secured creditors, we can introduce registration system. overcoming the disadvantages and exerting the benefits of fluidity contract, the fluidity contract will not only make our Real Law more inclusive and sophisticated, but also make the financing channels for the construction of our market economy more convenient, broad.