AmCham Regulatory Committee comments on draft bill modifying the credit Collateral Register scheme
- May 06, 2016
The Ministry made its request in early April pursuant to the strategic partnership agreement with AmCham. In its response, AmCham welcomed the innovation that the new Collateral Register will officially certify the genuine existence of facts recorded in it and the requirement that entries may only be registered, amended or deleted subject to a legal statement, final and binding court order or official resolution. However, the Regulatory Committee opined that the rules of document review provided in the bill are too formal and do not ensure that the main goal set in the general reasoning of the bill is achieved.
The Regulatory Committee also pointed out that the public notary responsible for formally reviewing the relevant documents is only required to examine limited data, thereby raising concerns that the validity of the document will not be examined on all merits. According to the Committee, the bill does not adequately address what public notaries should do when, despite their restricted authority to formally examine documents, they identify material inconsistencies which may make such documents null and void. The Regulatory Committee questioned how an entry can be made in the officially certified public Collateral Register based on an invalid document. According to the current version of the bill, in such a case submissions cannot be dismissed and proceedings cannot be terminated. The Regulatory Committee stressed that this problem should be rectified in the bill.
Additionally, the Regulatory Committee provided several minor proposals for enhancing the bill, such as ensuring that documentary review can be made electronically and that grammatically incorrect passages can be redrafted.
The Regulatory Committee highlighted the need to hold professional and social consultations in respect of exempted cases and the executional orders of the Ministry of Justice concerning costs and implementation.