Lex situs: Difference between revisions

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So, if your assets are held in a [[tri-party collateral arrangement]] in {{tag|Luxembourg}}, for example, even if your trading contract is an English law {{gmsla}}, you ought to have a [[Luxembourg law pledge]] to go with your English law [[Fixed charge|fixed]] or [[floating charge]].
So, if your assets are held in a [[tri-party collateral arrangement]] in {{tag|Luxembourg}}, for example, even if your trading contract is an English law {{gmsla}}, you ought to have a [[Luxembourg law pledge]] to go with your English law [[Fixed charge|fixed]] or [[floating charge]].
{{seealso}}
*[[Luxembourg law pledge]]
*[[Pledge]]
{{c|Foreign Security}}

Revision as of 12:02, 1 November 2018

A word about credit risk mitigation

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Latin for “the law of the place”. Relevant when contemplating the deep magic of taking security over assets in far-off places.

In a nutshell, international conventions of security law say that it is best to have security interests governed by the “lex situs” – the prevailing domestic law where the secured assets are physically located.

So, if your assets are held in a tri-party collateral arrangement in Luxembourg, for example, even if your trading contract is an English law 2010 GMSLA, you ought to have a Luxembourg law pledge to go with your English law fixed or floating charge.

See also