| With the development of international co-operation and improvement oftransnational commodity and service trade, many receivables financing practicessuch as assets-based financing, factoring, forfeiting, securitization are of prospect.But the differences and contradictions of internal legal systems on assignment ofreceivables constitute an obstacle to the improvement of international trade, for thesolution of disputes arising from assignment of receivables is uncertainty and notpredictable. UNCITRAL. had made the effort and passed the United NationsConvention on the Assignment of Receivables in International Trade (refer to as"Convention").The Convention aims the goal that adoption of uniform rules governingassignment of receivables would promote the availability of capital and credit atmore affordable rates and thus facilitate the development of international trade.The Convention radicates several principles on assignment of receivables andestablishes some rule thereto, eradicates many restrictions. The most important is,Convention eliminates the uncertainty of choice of the applicable law andstipulates that the assignee or other competing claimant such as other assignee,debtor of the assignor and assignor's insolvency administrator has the right to getthe payment. To reach this, Convention makes the priority conflict governed byone separate law system. Convention involves some uniform priority rules onproceeds in order to improve the practice of securitization; otherwise some statesdo not recognize the right of proceeds. Convention also states some modelsubstantial priority rules as reference for those countries which want to get someinstructions on modernizing their substantive priority rules.The first section of this essay analyze the definition of priority andprerequisite concepts: competing claimant, State, receivables, assignment, andothers. This section points out that priority means not only the right of a person inpreference to the right of another person, but also the nature and effectiveness ofthe right All perspective conflict of rights shall be included in the definition of thecompeting claimant. Receivables means existing receivable, future receivable andbulk receivables. In the light of competing claimants in Convention, the second section of thisarticle lists some conflicts of right between assignee and other persons, suchanother assignee, the debtor of assignor, insolvency administrator of assignor. Thissection also unclose some reasons the conflict of rights arising from.The third section of this paper stated some rules goveming the priority both atinter-nation level and at the Convention plane-the international private lawapproach- the law of the state in which the assignor is located governs priority ofthe right of an assignee in the assigned receivable over the right of competingclaimant. Moreover, this section also points out exceptions of public policy andmandatory rule of forum state, special hales on proceeds and subordination.Section four analyzes some stipulations of PRC laws, namely, Contract Law,Property Rights Law, etc; and proposes that there should be some modifications tothem and establish our own priority rules in reference to Convention and the needof assignment practice. |
