Louise Gullifer

The law of security and title-based financing

Previously published as The Law of Personal Property Security, this new edition brings together all of the law on this complex area, providing guidance in the context of commercial practice, especially with increased coverage of conflict of laws, priority, insolvency, and enforcement.

The Future of Trade Receivables Securitization in Europe

This article reviews Demica’s research in 2011 and 2012 among Europe’s top 40 banks on the growth trends in trade receivables (TR) securitization. It also provides an update on legal issues around the subject, drawn from research work at the University of Oxford. As other sources of distribution and risk-offloading have disappeared, European bankers have seen increased appetite and demand from corporations for accounts receivables securitization. TR securitization provides banks a safe, secured way of allocating capital while allowing them to continue to provide funding through revolving bank facilities. From the corporation point of view, the main factor that makes TR securitization an attractive alternative source of funding is that the underlying portfolio rather than the balance sheet of the originator is the key risk factor. In other words, financing is predicated on the debtor risk profile rather than the creditor’s rating, which often results in lower-cost financing for the corporation. TR securitization not only appears to have survived the financial markets crisis and its aftermath, but it is also predicted by financiers to grow in coming years, as a result of (maybe permanently) squeezed relationship lending and a desire from corporations and their banks to diversify company sources of finance. This review of the legal framework for trade receivables notes a number of potential risk exposures that need to be taken into account. However, these areas of risk do not fundamentally hinder the TR securitization process; they simply need to be accommodated in the legal structure and the pricing of the instrument.

The Australian PPS reforms: what will the new system look like?

The Australian Personal Property Securities Act 2009 has transformed the landscape of personal property security law in Australia. This paper examines the shape which the reforms take. The new regime largely resembles those introduced in other jurisdictions where reform has been undertaken, both in its broad structure and in the detail; it introduces a unified, functional approach towards security interests in personal property, a “notice-filing” regime for registration and a single electronic register. This paper discusses the extent to which it also departs from both the style and the substance of other regimes. Although many of the differences are intentional, they may prove ill-advised. However, even if faults can be found with the new regime, there is no doubt that it represents a significant improvement on what came before.

Piecemeal reform: Is it the answer?

The chapter considers the question of how best to reform a fully developed law of secured transactions. A system may have functioned reasonably well over a number of years, but through changing usage, judicial decisions and policy-driven statutory modification may have grown over-complex, contain inconsistencies and become inefficient. There are two approaches to such a state of affairs. One is to identify specific problems and to deal with them in a piecemeal fashion. The other is to undertake a wholesale rethinking of the system. The aim of this chapter is to consider this issue in relation to English law, which so far has been the subject of various attempts at piecemeal reform. The historical development of the English law of secured transactions is considered and the present position assessed. Using three specific examples, it will be argued that this has not worked well and that a wholesale approach is preferable.