On The Floating Charge

As a unique creation of the British Equity, floating charge system has been successively adopted by some countries of Anglo-American law system and of Mainland law system since its inception. It has played a big role in the realm of financing and thus is far from being replaced by other security systems. In 2007, with the establishment of "Property Law", movable floating mortgage system was formally incorporated into the system of China's security interests. In fact, the introduction of floating charge system is definitely positive for the improvement of our system of security interests. Floating charge is highly efficient and flexible, which enables the enterprises to proceed with their operation and production on the basis of a full use of their mortgaged assets. It is this very feature that makes the mortgaged assets realize their value and using value to the most extent. Accordingly, the system helps the communication and allocation optimization of resources all over the world, meeting the development requirements of modern market economy. However, floating charge in China is more confined to paper work and lacks a practical basis, making mortgagee sales more prone to security risks. The only three provisions of "Property Law" can hardly support the operation of the whole system, and its rough legal framework will undoubtedly bring more risks to the execution of law in future. Therefore, it is necessary to make a deeper research on the floating charge system, in an attempt to improve its system design and provide legal protection for mortgagee sales.This thesis is intended to analyze the problems existing in the regulation and practice of the floating mortgage system in China on the basis of a comparison of its design of every country, and will put forward advice and opinions on improving our floating system in the end. The pattern is as follows:First, the major theoretical issues about the floating charge system will be talked about, including its historical origin, concept characteristics, value analysis, comparative analysis of floating charge and related systems; Second, the author will elaborate on the design of the system of different countries in aspects of the establishment of floating charge, its registration and operation, aiming to throw some light on the improvement of our floating charge system. Last but not least, the author will emphasize the positive significance of the introduction of floating charge system to China and at the same time point out its design flaws existing in our current system. On that basis, the author will propose several suggestions on how to improve our floating charge system, which are developed in five aspects:limit the main body of the floating charge to the company; expand of the range of collateral appropriately; Perfecting the floating mortgage registration system;establish the priority of floating charge system and introduce the take-over system.