Article 9 of the Uniform Commercial Code of USA is recognized as a model for other legal systems by anticipating developed regulations on the security interest in movable property. One of the essential features of this article is the rules on the enforcement of the security interest and the priority of the holders of rights in a same collateral. On this basis, if debtor defaulted, the beneficiary of the collateral may personally, without interference by the court or other official body, enforce the security interest and repossess collateral to foreclosure or sell it as consideration of the debt or part of it. Performance of the conditions, such as non breach of peace, the reasonable conditions of transfer and foreclosure, is mandatory and the violation is warrantable. In relation to the priority of holders of security interest, a creditor who has perfected and registered his right prior to others, regardless date of conclusion of the security agreement. In Iranian law, action to official authorities is only way of enforcing security interest in movable property. Priority exercise on the basis of the precedence or delay of the date of conclusion of the security agreement. due to the lack of a filling system, the establishment of unified systems for registration of security interest in movable property, priority over time and granting of the right of self enforcement the security interest to the beneficiaries by considering the responsibility is offered, in order to develop the security in the movable property and financing.

In most of the legal systems, to guaranty the loans, there are two types of collaterals: Fixed charge ands Floating charge. The first type often occurs in tangible properties and assets while the second one has an ability to occur in the debtor's whole assets. Floating charge, which has been recognized in Article 9 of the Uniform Commercial Code, has been considered to create security interest in the debtor's future assets and also to create trust about the maintenance of mortgage on alienable properties. Precision, coherence and comprehensiveness of this Article have been inspired by most of the legal systems in codification of the rules of mortgage contracts. Although there are some regulations about mortgage contract in the Civil Code of Iran, taking securities from asset's value and future's benefit has been permitted to facilitate loan receiving in manufacturing plans since 2007. In this research, such a new regulation is studied comparatively in both contexts of Iranian and American legal systems.

This paper examined the charge of circulating assets in common law jurisdiction. The aim was to know the way and basis that it is constituted and to find out its profits for creditors and also to find out its meaning and its impacts in market. The conclusion was that floating charge provides an appropriate security and benefits for the chargee and chargor، where chargee can achieve his benefits and chargor can carry on his ordinary course of business. In this kind of charges third parties’ rights have been supporting as well. In addition the assets in the ordinary course of business are the main part of the company’s assets and depositing them as a floating charge will increase the capital of the company، will improve the efficiency of economy and will give creditable security to banks and financial institutions and it will have benefits for economy.

Civil Act discussing the mortgage brings regulations on characteristics of subject of mortgage, mortgagor’s rights and mortgagee’s rights. But only exceptionally has regulations on the debt mortgaged for. Depending on determining whether mortgaged stock is mortgaged for present or for future debts of directors, this question would be answerable that if somebody re-seized the mortgaged stock and after it director damaged the company, which one would prevail, re-seizing person or mortgagee of that stock? Despite what at first glance under the influence of Civil Act seems, Commerce Act and its Amending By-Law in addition to taking mortgage for existing debt, approve taking mortgage for existing pledge and for non-existing debt which its cause has been formed. So, the company takes mortgaged stocks from directors not for existing debts i.e. for putting its asset under the directors’ custody but for future and possible damages which may occur from their managerial conduct (i.e. non-existing debt which its cause has been formed). So, until the damage has not been sustained and the mortgage is not established, the re-seizure would prevail the mortgage. As a result some allowed kind of re-mortgage forms.

t is the existence of a right or at least the existence of a cause leading to a right. Based on this, providing security deposit for a debt that will arise in the future, such as a loan to be received in the future, is contentious, and renowned jurists do not accept this type of security deposit. The main issue is whether the view on the invalidity of providing security deposit for future debts is based on established and irrefutable evidence, or if there is room for questioning the validity of those arguments. Furthermore, considering the dependency of the security deposit on the debt, the existence of a debt is necessary for the creation of a security deposit. Studies indicate that there are two main perspectives in this regard: the first perspective confirms the invalidity of providing security deposit for future debts, while the second perspective adheres to the principle of security deposit for future debts and considers it valid. In civil law, there is also no explicit clarity on this issue. Judicial practice also does not accept security deposit for future debts by adhering to the opinions of most jurists. After critically examining the arguments and evidence, the research concluded, using a descriptive-analytical approach, that since the goal of law is to preserve social order and justice, it must align with contemporary social needs. Therefore, in the context of security deposit, considering their credibility, customary practices, and rationality, there is no justification for requiring proof of the debt. This issue falls under general principles and applications of contracts. Therefore, security deposit for future debts, where justified, is considered a valid principle in the legal system based on the mutual consent of the parties involved. Because individuals need security deposit for their transactions in their business relationships to ensure peace of mind. This not only maintains contractual balance and stability but also enhances investor confidence.

The main objective of this study was to investigate the moderating effect of financial constraints of Kaplan-Zingales Index (1997) on the relationship between the structure of collateral assets and financing structure of the companies listed in Tehran Stock Exchange (TSE). To this end, the study was carried out using systematic elimination skewed sample consists of 155 firms over the period of 11 years -from 2004 to 2015. The results show that moderating effect of financial constraints on the relationship between and the total collateral assets with financial leverage and components collateral assets (property, plant and equipment, inventory, accounts receivable) with the company's financial leverage is direct and significant. The test of the third hypothesis showed that there is no moderating effect of financial constraints on the relationship between long-term assets and long-term securities held by financial leverage. Furthermore, testing the moderating effect of financial constraints on the relationship between short-term bond funds with short-term financial leverage impose a direct and significant relationship; as well as the moderating effect of short-term financial constraints on components of collateral assets (inventory, accounts receivable) with short-term financial leverage denote that there is a direct and significant relationship and non-relationship for the aforementioned issues, respectively.

Financiers usually enjoy various security devices for guarantee of the repayment of the principal and interest, among them one which is very prevalent, in particular in unsecured finance, is “negative pledge covenant”, according to which the borrower promises not to encumber his assets in favor of any other creditor. This clause purports to protect the financier, who is unsecured, vis-à-vis other creditors of the borrower, who have priority, upon enforcement of his claim out of the borrower's assets. Although this clause, which has various kinds, is basically binding inter partes, in some types, the so-called “affirmative negative pledges” might lead to security interests. The negative pledge clause is popular in corporate finance and not only the validity of this clause, but also its default remedies –in particular against third party creditors who have gained the security interests in borrower’ assets- would be rather illusory under Iranian law. The definition, legal nature, validity and default remedies of negative pledge clause are among the main issues which are examined elaborately in this article with a comparative study of English and Iranian law.

The UNCITRAL Model Law on Secured Transactions which was approved by the UN General Assembly in 2016 has provided for rules on conflict of laws to determine the applicable law on secured transactions. These rules separate the contractual aspects from the property aspects of each secured transaction. The contractual aspect includes the mutual rights and obligations of the grantor and the secured creditor. Contractual aspect involves the mutual rights and obligations which are created between the parties to the agreement. It also includes the effects of the contract against third parties who might be affected by this contract. The effects of a contract on secured transactions will affect three parties. The first party is the guarantor who demands money from another person as collateral. The second party is the guarantor who accepts the mortgaged property. This contract is considered obligatory for the guarantor, but it is regarded voluntary for the other party. The latter whenever wishes might waive the collateral and if the guarantor has incurred costs in enforcing the collateral, the guarantor must reimburse these costs. The third party who owes money although is considered to be a third-party collateral for the contract. However, because his liability is the source of his debt, if he is notified of a security right in a receivable he is obliged to fulfill its obligation upon request. The second paragraph of Article 1 of the Model Law extends the scope of this law to the transfers of receivable contracts. This paragraph states that: “except otherwise is provided in Article 72 to Article 82, this law shall be applied to transferees by agreement of the parties”. Property aspect of a contract on secured transactions involves the creation of effectiveness for third parties and priority of a security right among competing creditors. This distinction has been made on the basis of the protection of certainty principle and predictability objective as well as the protection of reasonable expectations of involved parties and also the protection of third parties’ rights. The model law considers that the law chosen by the parties would be the applicable law on the contractual aspect of security rights. In the absence of a choice of law by the parties to a contract on secured transactions, the law of a State that the security agreement has most closely connected with it will be applied. This place is the place where the characteristic of the agreement as the most important part of the obligations arising from security agreement have the most resemblance with the law of that country. Because the monetary obligation owed to the debtor of the receivable is used as encumbered asset, the UNCITRAL Model Law on Secured Transactions, makes the relationship between secured creditor and the debtor as the subject of applicable law between the debtor and grantor as the principal creditor. This is to protect the debtor’s rights regarding the property aspect of the security agreement, the law on the location of the grantor has been determined as the applicable law, although there are exceptions to this rule. The purpose of the UNCITRAL Model Law on Secured Transactions is to establish a new system for endorsing obligations by means of movable property, both tangible and intangible. This law provides for conflict resolution of laws to determine the law governing the agreement. Protecting certainty and predictability, as well as the legitimate expectations of stakeholders are considered as criteria for determining the rules on conflict resolution. The contractual aspect deals only with the rights and obligations arising from the contract and is limited to the relationship between the guarantor and the pledgee and the debtor of a monetary claim. Regarding the contractual aspect, the law governing the mutual rights and obligations of the guarantor would be their chosen law. In the absence of the selected law, then, a law which has the closest connection with the contract shall be applied. The benchmark for the determination of the closest relationship is to realize which of the parties fulfills the most important and major part of the obligation so that the law of his place of residence can be considered as the governing law. In this vein, the most important part of the contract relates to the nature of a contract, and it is a part of a contract which the contract was mainly created because of it, and if it does not exist, it is not a contract. The selection of the most important part of a contract does not have a precise criterion and is at the discretion of the court and can lead to conflicting results. In the relationship between the guarantor and the debtor of a monetary claim, as the contract cannot restrict the rights of third parties, the same law governs the contract between the debtor and the main creditor, namely, the guarantor. The financial aspects of a contract include the conclusion of a contract and relying on third parties and applying the priority of collateral over various creditors. In these cases, the principle of sovereignty of the guarantor is not governed and the model law in accordance with the type of property has developed a conflict resolution rule. If the mortgaged property is tangible property, the law of the place of occurrence of the property will prevail over these aspects. However, if the property is an intangible property, the law of the place of pledge of the guarantor will govern these aspects to protect the rights of third parties. In the context of the Iranian law, all contracts are governed by Article 968 of the Iranian Civil Code and Article 27 of the International Commercial Arbitration Law of Iran. These two codes do not distinguish between the contractual and property aspects of a security agreement. This study suggests that in the Iranian law, the model law approach should also be implemented to determine the rules of conflict of law so that the applicable law on security agreement can be ascertained.

Commercial instruments, in particular meaning, or bills are one of the most important means for business parties to enter into transactions. Such instruments are considered as a certain form of property with a great variety of uses. For example, they can be used as a means to pay or to use as a guarantee or security. But a question has always been posed:” whether such instruments can be used as security or guarantee in accordance with law”. Mortgaging the instruments which are not regarded legally to have genuine value is under question and discussion among law professionals. Some of them absolutely accept this and some not. A group of them discuss the instruments stressing on the fact that they are bearing or not. Most of the law professionals consider such instruments within the framework of mortgage contracts, and they place no difference between security/guarantee and mortgage; while, it seems that mortgage has a general and broad meaning, while mortgage is a particular example of that and is subject to civil code. Therefore, it can be said that mortgage is a security, but the contrary does not hold. This separation occurs in British law as well. Here in this paper, I deal with the legality of mortgage and security uses of bills in Iranian and British laws. General conclusion which can be drawn from my research is that bill means check and promissory note which is a certain kind of credit property of movable nature, so it is capable to be legally transferred, received, mortgaged and used as security or guarantee. Such matters have not also been accepted by British law, and there can be no difference between Iranian and British laws in this regard, although the mortgage is understood and treated differently in the two laws.

Sever spike of non-performing loans coincided with rise in the stock price in recent years, change bank’s credit managers attitudes towards liquid securities such as shares, as a collaterals of facilitates. The purposes of credit managers for changing the policy is attracting companies with higher credit value and ultimately reduce credit rationing for the company. In this paper, by using propensity score matching (PSM), we evaluate the effects of policy changes in credit rating and credit rationing as outcome variables. Our Information, including the data base of one of the private bank entails companies in 1391-1392. Credit rating is the first outcome variable. The second outcome variable is ratio of facilities to each company to total bank facilities as an indicator of credit rationing in the bank. Treated or program variable is various collaterals such as liquid and illiquid. The control group is a group that has illiquid collateral, such as property or equipment and program group has liquid collateral such as stocks, deposits and warranty. Our results show that change in policy does not affect the credit rating. Also, liquid collateral decrease the credit rationing for liquid collateral pledged.