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A registered pledgee will have priority over an unregistered pledgee in respect of the same pledged property.
Unless the pledgor and pledgee agree otherwise, the pledgor is not permitted to operate the bank account.
Effectively, the pledgor and the pledgee are not required to identify the specific assets that are subject to the pledge.
Under the Commercial Pledge Law, where the pledgee and pledgor agree, the pledgee may enforce the pledge directly without the requirement of a court order.
Once the notice period (10 days) ends, the Execution Agent/ pledgee will have to submit the extract to the authorities.
It is important to mention that the self-help clause does not permit the inclusion of a provision in the agreement, which allows the pledgee to take direct ownership of the pledged property against secured debt in the event that the debtor fails to make payment of the debt.
The Commercial Pledge Law, however, has provided the pledgee (when an event demanding the execution of pledged property takes place) with the right of enjoying preference over other involved parties when it comes to buying the concerned pledged property.
When a financing contract is breached by the debtor in a manner that makes execution mandatory and the pledge agreement does not contain a self-help enforcement clause, the execution agent or pledgee would carry out the following steps for enforcement: