NON-POSSESSORY PLEDGE UNDER THE LAWS OF ARUBA
A non-possessory pledge requires a deed
Security rights are an important issue, especially in financing transactions. A company may, for example, guarantee the obligations of another company under a certain loan facility. There are several alternatives, one of which will be discussed here.
Under the laws of Aruba there are several kinds of pledges, in particular, the possessory and the non-possessory pledge. In the case of a possessory pledge, the physical control of the assets concerned will be transferred from the owner/borrower to the bank/lender.
In the case of a non-possessory pledge, regarding for example registered shares, the pledge is …
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FOREIGN CLAIMS SECURED BY ARUBAN SECURITY RIGHTS
The foreign law governed claim must be sufficiently identifiable
Many financing arrangements are of a cross-border nature. For instance, a loan agreement governed by English law with the loan secured by a right of pledge governed by the laws of Aruba. This raises all kinds of questions.
Any foreign right, for instance a claim, in which an Aruban pledge is created, must be sufficiently identifiable (‘met voldoende bepaaldheid omschreven’) within in the meaning of section 3:84(2) of the Civil Code of Aruba.
Also, if one wishes to create a right of pledge in a foreign right, such a right must …
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PLEDGING A REGISTERED CLAIM IN THE DUTCH CARIBBEAN
Disclosed vs undisclosed
A right of pledge is a limited right, intended to provide recourse against the property subject thereto for a claim for payment of a sum of money, with preference over other creditors. A registered claim (vordering op naam) is a personal right to payment not to order or bearer. The difference is of relevance with respect to establishing a right of pledge. A right of pledge on, for instance, bearer shares, is established by bringing the shares into the possession (under the control) of the pledgee (possessory pledge) or through a deed (non-possessory pledge).
Where it concerns …
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