On Movable Floating Charge

As a unique way of security, Floating charge system, originated in the United Kingdom, was founded to break through the traditional principle of property rights theory, so that the functions of a security interest develop from the preservation to financing, give full play to the effectiveness of the material, the more satisfied the needs of corporate finance, and this system has been extensively applied in economically developed countries. In China, the adopted " Real Right Law" (2007) creates with Chinese characteristics movable floating charge system, brings our country's security system to more completion, establishes new ways for the financing of small and medium enterprises, opens up for the bank new opportunities and challenges.Firstly, this article reviews the origin and the development of the floating charge system, compares its similarities and differences with the fixed mortgage system, the consortium mortgage system, the maximum mortgage system, shows their content and features, including its Chinese content, features and legal relations, as well as its reasonableness to establish. And then analyzes the relative regulations, its theoretical nature and status quo of the floating charge system in those common law countries and civil law countries, and compares the Chinese floating charge system with its foreign parts, especially their different creation conditions and its practice status.Theoretically, this article attempts to analysis the operation and value of China's movable floating charge system. Through elaborating its establishment conditions, its ways to taking effect, its significance of registration, its crystallization origin, its process of application, and the realization and procedures of the mortgage right, the article sets forth the value analysis of movable floating charge, compares its charges strengths and weaknesses. And then from two levels of theory and practice, shows by example the feasibility of its extensive applications in multiple fields of corporate finance, bank credit, issuing bonds, as well as project finances. It is indicated that, along with the difficulties in fina- ncing for small and medium enterprises, the question for our legislators recently is, how to amplify the special functions of the movable floating charge.Based on the above analysis, this article holds that, several provisions relative to movable floating charge system within the Chinese "Real Right Law" are relatively brief, there are many vagueness in its establishment subject, object and content, which results in kinds of problems. In order to make further completion of our system of floating charge on movable property, it is proposed to adhere to the principle of public credibility, a clear order of priority for repayment of principle, while promulgating some specific provisions and other supporting legal systems, and get our system of movable floating charge in practice utilized more effectively, so as to implement a better job in promoting economic development.