In The Construction Of Ship Mortgage Finance Legal Issues

It's too much of an expense to do the project of ship construction. During the ship construction, the ship factory or shipping company may encounter the financial problems, so they need the financial support from the under-construction ship. Then the under-construction ship mortagage loan appears and seems to be prospering in all of the countries. The fact also shows that it is an ideal method to make use of the under-construction ship mortagage loan to solve the problems in the shipping financing.Because of the special character of the object, there are great differences between the mortgage of under-construction ship and the mortgage of ship. Its set-up and announcement method have their own specialty while its validity and realization become more complex. Furthermore, the risks that the under-construction mortgagee suffers are more various, the preventive measurements are more special as well.However, this new kind of effective ship financing method hasn't been applied widely in our country. Following are the reasons: First, our country is short of legal provisions in this aspect; so many problems haven't been clarified. What's worse, there is a certain lack of the investigation and discussion about this in the theoretical field of maritime law and financial law. To some extent, it results in the bank excluding the way of financing due to the fear of the rights without the protection of the law. Second, with the inadequate knowledge of the feature of the project of ship construction and the risk, the banks are always cautious to this financing method. As we all known, ship construction is the base of shipping industry, it is necessary to solve the financial problem of ship construction in order to develop the shipping industry in our country.Hereby, it is necessary to clarify some problems about the right of mortgage of under-construction ship and analyze the risks and prevention in the mortgage loan scientifically. This thesis is divided into six chapters to discuss.In chapter 1 On the basis of comparison of various ship financingmethods, it put forwards that under-construction mortgage loan is an effective way to solve the problems in financing, and makes a brief analysis of the feasibility of the financing method.Chapter 2 attempts to discuss the set-up of the right of mortgage, including the qualification of mortgagor, the time of setting-up and registry of the right of mortgage. The setting-up of mortgage on the construction-ship has broken through the Chinese traditional system of the right of mortgage. Though construction-ship has not independent value in use, it has value in exchange and can be mortgaged.Chapter 3 discusses the validity of mortgage, including the scope of the object of mortgage and the validity of mortgage to the mortgagor and mortgagee. It also comes up with some proposals for the amendment of the article 35 of Guaranty Law.Chapter 4 discusses two kinds of insurances for protecting the right of mortgage of under-construction ship —the ship insurance and the mortgagee interest insurance. It points out that they have qualities of project insurance and marine insurance, which clears the applicable laws and jurisdiction when the insurance disputes happen.Chapter 5 focuses on the realization of right of mortgage. The conclusion is drawn as follows: the traditional four methods in realization of right of mortgage are not enough to protect the mortgagee. The better method is that reserving the right of mortgage till the ship construction is over meanwhile the value of ship achieves maximum.In view of the existing situation that the banks evade blindly risks and are too cautious of under-construction ship mortgage loan, Chapter 6 analyzes the risks of the operation and puts forward the measures guarding against risks.In conclusion, this paper doesn't make a comprehensive perfection on the system of under-construction ship mortgage, but only concentrate on some important problems, as which should be clarified by the other scholars. By the way, I also hope this thesis will contribute to promotion of the under-construction ship mortgage in china.