Creditors are now entitled to obtain, as security for loans, a pledge over existing or future identifiable assets of the debtor (or third party guarantor), which does not require the dispossession of the latter (or third party pledgor).
If provided for by the contract, the owner of the assets secured by the pledge may dispose of said assets, even selling them, although in such case the pledge will be transferred over the consideration obtained by the sale or over the replacing asset(s) purchased by the pledgor with the consideration of the sale.
The pledge must be agreed in writing through a specific contract providing details of: the creditor, the debtor and the pledgor, the description of the pledged assets, the secured credit and the maximum guaranteed amount. The creation of the pledge is perfected through recording in an ad hoc register held by the Tax Authority. The registration has ten-years renewable validity and is enforceable against third parties and bankruptcy proceedings.
Upon occurrence of an event causing the enforcement of the pledge, the creditor is requested to inform in writing the debtor (and the third party pledgor) and any possible pledgee resulting from subsequent registrations. Compared to the enforcement of the “traditional” pledge provided for by Italian Civil Code, the notice apparently must not be sent through a bailiff and the 5-days’ grace period for starting enforcement shall not apply.
The enforcement allows the creditor to have the pledged assets sold through competitive procedures based on an estimate of the assets made by expert appraisers, which may be appointed by mutual agreement between the creditor and the debtor or by the judge. The creditor will retain the sums obtained by the sale up to the amount of its credit and pay the difference to the debtor/pledgor.
Further enforcement procedures are granted to the creditor by the Law Decree, namely:
- lease of the pledged assets, whereby the creditor will apply rentals against repayment of its credit;
- appropriation of the pledged assets by the creditor, whereby the latter will apply the value of the asset against repayment of its credit.
These two further enforcement procedures apply only if a specific clause is inserted in the contract creating the non-possessory pledge, and that such clause is registered in the companies’ register.
Also, the contract must provide for criteria and procedures for the evaluation of the rentals due for the lease of the pledged assets and/or for the assessment of the assets value in case of appropriation. In lack of such provisions, the debtor is entitled to seek damages, though the relevant action must be started within a strict 3-months’ timeframe.
It is worth mentioning that the non-possessory pledge may be enforced by the creditor even in case of pledgor’s bankruptcy, provided that the credit has been fully admitted as privileged credit in the bankrupt’s liabilities pot.
The lack of dispossession of the pledged assets should entitle the debtor/pledgor to create multiple pledges over the assets, having the same or a different ranking.