CREDIT AGREEMENT WITH FIDUCIARY COLLATERAL IN THE FORM OF A PATENT IN THE PERSPECTIVE OF INDONESIAN LAW

Purpose: Community needs for capital are obtained in various ways, one way is to make a debt agreement with financial institutions. This method is one way that is quite simple to obtain funds to support business activities. This debt agreement is usually carried out with a guarantee that the guarantee is a complement to provide assurance for financial institutions, in this case, the bank can obtain a loan refund in the event of an interpretation. One of the things that can be used as collateral is a patent. With the issuance of the latest law the patent is one way to obtain a loan from the bank. Methodology: This research study gathered theoretical data about loan granting under fiduciary security of patent. Main Findings: The development of the global community has caused development in security of loan application in banking internationally, one of them is security by using Patent. In Article 108 paragraph (1) of Patent Law, it is stated that right on Patent can be used as fiduciary security. The existing regulation indicates that the State supports economic development through granting of loan to Patent holders in order to develop their invention. A Patent Holder shall have an exclusive right to use the Intellectual Property Right by his/herself by using it as security. Implications/Applications: The findings of this study are helpful for the individuals in understanding the aspect of patents and exclusive rights held by the owner in order to secure Intellectual Property

Liquidity, systemic risk, and the bankruptcy treatment of financial contracts

Parties to repos, and to swaps and other derivatives are accorded privileged treatment under the bankruptcy laws of several dozen countries. Several key international “best practice” standards urge legislators in other jurisdictions to provide likewise. The beneficiaries of these privileges are solvent counterparties enabled, unimpeded by bankruptcy moratoria, to implement close-out netting arrangements and to dispose of collateral. The purported rationale is mitigation of systemic risk. Taking a broad international perspective, this Article explores the “domino” contagion view of distress that motivates the privileges. This view derives from the outdated “microprudential” understanding of systemic risk, and is theoretically flawed and empirically false. Drawing instead on the “macroprudential” approach, the Article argues that the elements of the broad close-out netting process—contractual termination, marked-to-market valuation, netting, and unimpeded collateral disposals—exacerbate systemic risk by increasing common exposures to risk, systemic uncertainty, procyclicality, and leverage, while reducing lending standards, collateral utilization, and regulatory capital buffers. A recent attempt to provide a new rationale for financial contract privileges highlights their contribution to the “exponentiation” of liquidity. This Article shows that the privileges diminish the liquidity of markets and financial institutions alike. What they exponentiate is “froth.” This rather unfamiliar label describes the all too familiar state in which assets are persistently and/or progressively overvalued and in which negative net-value projects obtain funding. The exponentiation of froth—the textbook recipe for systemic crises—should only be attractive to financial institution decision makers whose remuneration perversely tracks the riskiness of their institutions. The Article also throws new light on the international spread of financial contract privileges. It expands on existing literature by mapping the path-dependent process by which national legislators and international standard setters were persuaded as to the alleged value of these privileges. It illustrates the key mechanisms by which any consideration of the costs of the privileges was precluded. The Article concludes by rebutting the argument that bankruptcy law should not play any role in systemic risk mitigation, and by consolidating proposals to reform bankruptcy laws to protect the social welfare-enhancing features of financial contracts without encouraging systemic risk, value destruction, or unfairness

Exploiting the pIedge as a security device

"Plusieurs auteurs soutiennent que le régime québécois des sûretés mobilières présente de graves défauts. En particulier, ils prétendent que les sûretés nécessitant la dépossession du débiteur sont désuètes et inefficaces et qu'il y a lieu d'adopter le plus tôt possible la nouvelle hypothèque mobilière proposée par l'Office de révision du Code civil. Le but de cet article sera d'examiner le bienfondé de chacune de ces propositions à partir dune analyse de la sûreté mobilière de droit commun, soit le gage. [...]

Personal Property as Collateral in Japan and the United States

It is our purpose to compare Japanese and United States law and practice in the area of personal property security. Since it is not possible to find a precise common terminology for different types of security transactions, it seems desirable to arrange the discussion in terms of possessory and non-possessory security, and to use as subheads in the latter category the names of the American security devices. Security transfers of intangibles, chattel paper, and title documents are discussed under the possessory-security classification. An appendix includes English translations of cited Japanese statutes and pertinent Civil and Commercial Code as well as forms typical of those currently used in Japan