Restructing & Insolvency

This article was originally published in Cross-border Restructuring and Insolvency Handbook 2009.

Security and Priorities

1. What are the most common forms of security taken in relation to immovable and movable property? Are any specific formalities required for the creation of security by companies?

Immovable property

The security most commonly granted over immovable property is the mortgage. A mortgage can be legal or equitable:

• Legal mortgage. This gives the lender a legal interest in the mortgaged property until full repayment of the loan or the performance of some other obligation. A mortgage does not constitute an estate in land but rather a contractual right for the benefit of the mortgagee and a charge on the immovable property.