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Floating charges

The most common form of general preferential claims is a floating charge (?företagsinteckning?). It is a security which covers all business assets with certain exceptions e.g. liquid funds. However, creditors with a special preferential claim to a certain asset have, of course, priority before the holder of a floating charge.

For a couple of years the floating charge has been limited to only 55 per cent of the value of the assets to allow for an increased possibility of payment of non-preferential claims. On January 1, 2009 this will be changed and 55 will become 100 per cent again.

Full post as published by Swedish Law Blog on December 05, 2008 (boomark / email).