Chương 2 Nghị định 163/2006/NĐ-CP: Giao kết giao dịch bảo đảm

Chapter II

ENTRY INTO SECURITY TRANSACTIONS

Article 8.- Security for performance of obligations with future assets

In case the performance of an obligation is secured with a future asset, when the securer owns part or the whole of the security asset, the securee will have the right to part or the whole of that asset. For assets that are, under law, subject to the ownership registration but have not yet been registered by the securer, the securee may still dispose thereof when the time for disposal comes due.

Article 9.- Notarization or certification of security transactions

1. The notarization or certification of security transactions shall be agreed upon by the involved parties.

2. When it is so provided for by law, security transactions must be notarized or certified.

Article 10.- Effect of security transactions

1. A security transaction which is lawfully entered into takes effect as from the time it is entered into, except for the following cases:

a/ The involved parties otherwise agree;

b/ The asset pledge takes effect as from the time the asset is transferred to the pledgee;

c/ The mortgage of land use rights, forest use right, ownership over planted production forests, aircraft or seagoing vessels becomes valid as from the time of mortgage registration;

d/ The security transaction becomes valid as from the time it is notarized or certified under law.

2. The general description of security assets does not affect the validity of security transactions.

Article 11.- Time when a security transaction is legally valid for a third party

1. A security transaction shall be legally valid for a third party as from the time it is registered. The time of registration is determined according to the provisions of law on registration of security transactions.

2. The change of a party or parties to a security transaction shall not change the time that security transaction is legally valid for a third party.

Article 12.- Registration of security transactions

1. Cases where registration is required include:

a/ The mortgage of land use rights;

b/ The mortgage of forest use rights, ownership right to planted production forests;

c/ The mortgage of aircraft or seagoing vessels;

d/ The mortgage of an asset to secure the performance of many obligations;

e/ Other cases specified by law.

2. Security transactions not falling into the cases specified in Clause 1 of this Article shall be registered upon requests of organizations or individuals.

3. The order, procedures and competence for registering security transactions shall comply with the provisions of law on registration of security transactions.

Article 13.- Cases where security assets are not owned by securers

1. When a securer uses an asset not under its ownership to secure the performance of civil obligations, the owner may reclaim that asset according to Articles 256, 257 and 258 of the Civil Code and Clause 2 of this Article.

2. When a security asset is purchased on a deferred payment, payment in installments or is rented for a term of one year or more by an enterprise or an individual that has made business registration, i.e., machinery, equipment or another movable not subject to the ownership registration and the contract on purchase on deferred payment, payment in installments or rent registered at a competent security transaction registry within fifteen days after that contract is entered into, the seller may retain the ownership and the renter is on the top payment priority upon the disposal of security assets. If no registration is made or the registration is made after the above time limit and after the security transaction is registered, the securee is considered as a bona fide securee and on the top payment priority upon the disposal of security assets.

3. Organizations or individuals that are secured with assets purchased on a deferred payment, payment in installments or rented shall not be considered bona fide securees after the contracts on purchase on deferred payment, payment in installments or rent are registered.

Article 14.- Cases where securers are reorganized legal entities

1. A securer being a reorganized legal entity shall notify the securee of its reorganization before it is divided, separated, consolidated, merged or transformed.

2. Involved parties shall agree on the inheritance and performance of secured obligations and security transactions in the process of reorganization of legal entities. If no agreement is reached, the securee may request the obligor to fulfill the obligations ahead of time. If it does not so request, the security transaction shall be executed as follows:

a/ In case of division of the legal entity, new legal entities shall jointly execute the security transaction;

b/ In case of separation of the legal entity, the separated legal entity and separating legal entities shall jointly execute the security transaction;

c/ In case of consolidation or merger, the consolidating legal entity or the merging legal entity shall execute the security transaction;

d/ In case of transformation of an enterprise or state company, the transformed enterprise shall execute the security transaction.

3. For security transaction established before the reorganization of legal entities and still within the execution time limit, the involved parties are not required to re-enter into those transactions. They may record in writing the change of securers.

For registered security transactions, the registration of change of securers shall be made within a time limit specified by law.

Article 15.- Relationship between security transactions and contracts involving secured obligations

1. When a contract involving secured obligations is invalidated but the contracting parties have not yet performed it, the security transaction shall terminate. If the contract involving secured obligations has been partially or wholly performed, the security transaction shall not terminate, unless otherwise agreed upon.

2. Unless otherwise agreed upon, invalid security transaction shall not terminate the contract involving the secured obligations.

3. When a contract involving secured obligations is cancelled or unilaterally terminated but the contracting parties have not yet performed it, the security transaction shall terminate. If the contract involving secured obligations has been partially or wholly performed, the security transaction shall not terminate, unless otherwise agreed upon.

4. Unless otherwise agreed upon, cancelled or unilaterally terminated security transaction shall not terminate the contract involving the secured obligations.

5. If a security transaction does not terminate according to the provisions of Clauses 1 and 3 of this Article, the securee may dispose of the security assets for settling the refunding obligation of the obligor toward the securee.