Study On The Legislation Of Chinese Floating Charge

Floating charge is a great creation of the UK law, which provides a broad way for the financing of enterprises in the United Kingdom. Floating charge in the UK is a bottom-up development, while China’s floating charge is of the contrary. The floating charge of the common law system has been gradually accepted by civil law system. At present, the floating charge system has been experiencing a great success in the field of project financing.China’s Property Law for the first time provides a movable floating charge system.however our provisions is quite different from the floating charge of the traditional common law system. In fact, our floating charge system is rough, and not a separate section, which leads to a congenital defect in the legislation. This is clearly a direct response to legislative defects of the Property Law. Meanwhile, the floating charge as one designed to provide fast and efficient system of financing channels for SMEs, these systems, including but not limited to, asset securitization, third-party guarantees.China’s SMEs, due to historical and practical reasons, are almost in rural China. However, due to the repayment ability of these small and micro-enterprise they need more support of relevant government financial system. Floating charge as a flexible and convenient means of financing, especially for the rural coastal areas, require proper regulation and control of the local financial system.Therefore, to improve China’s floating charge system, on the one hand, we need to complete its legislation, with particular attention to the establishment and enforcement of the floating charge; on the other hand, we must use other local financing system, in order to increase the application of the floating charge.