FMLC Publishes Report on Uncertainties in Financial Collateral

Financial Markets Law Committee

The FMLC has issued a paper which discusses aspects of financial collateral that require further clarification and possible solutions to the existing ambiguity. The report notes in particular a recent ruling by the UK High Court that floating charges can constitute a security financial collateral arrangement provided that the collateral is "delivered, transferred, held, registered or otherwise designated so as to be in the possession or under the control of the collateral taker or a person acting on its behalf".