Law on security over movable assets amended and postponed
The law on security over movable assets (the “Security Law”) was amended on 15 December 2016. Its entry into force, scheduled for 1 January 2017, was extended to a later date to be set by Royal Decree, not later than 1 January 2018.
The Security Law was adopted in 2013 and is intended to bring important changes to the Belgian regime governing security over movable assets including (i) perfection by registration in a National Pledge Register (i.e. without dispossession), (ii) simplified enforcement and (iii) the use of a security agent.
The amendments aim to improve the functioning of the Security Law by addressing practical issues identified during the development of the new National Pledge Register and by incorporating suggestions made by practitioners.
The main amendments are as follows:
- pledges on receivables will not be registered in the National Pledge Register, i.e. the existing regime of pledges on receivables (with fictitious dispossession) will continue to exist;
- there will be general access to the National Pledge Register, although certain modalities are yet to be determined by Royal Decree;
- certain of the general principles of the Security Law are made applicable to pledges over financial collateral (for example real subrogation, future assets etc.);
- repledging is possible if the pledgor agrees to it;
- a partial renewal or removal of a registration is possible, for example through the reduction of the maximum secured amount or the reduction of the volume (omvang/importance) of the pledged assets;
- any representative of the pledgee (typically the security agent) will, like the pledgee, be responsible for damage resulting from inaccurate registrations in the National Pledge Register; and
- the term for bringing a challenge against enforcement proceedings is shortened from 1 year to 1 month after notification of the end of the enforcement (3 months after the end of the enforcement for interested parties who did not receive an enforcement notification).
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