Abstract
This article analyses the South African legal framework governing security rights in movable property with the view to inspire law reform. The analysis is based on a comparison of the current South African framework with the UNCITRAL Legislative Guide on Secured Transactions, a soft-law instrument containing international best practice. The problematic aspects of the South African framework benchmarked against the UNCITRAL Guide are: (1) not having a common legal framework that equally applies to all types of (including quasi-) real security transactions; (2) the scope of the current framework not being comprehensive (inclusive) enough; (3) not having an efficient enough method of creating the security right; (4) the current publicity method, particularly concerning special notarial bonds, being overly cumbersome and not providing effective public notice to third parties; and (5) the current enforcement measures potentially not being the most efficient. Regarding each of these problem areas, the article makes proposals on how the South African legislature could reform the current framework into one that is legally efficient and in step with international best practice.
Highlights
The South African real security law framework concerning movable property has remained essentially unchanged over the past few decades
Upon comparing the latter with current South African law, we argue that South African real security law should be reformed to the following effect: A registered pledge should be adopted as the security device through which to encumber any individual movable asset or collection of movable assets, replacing general and special notarial bonds as well as cession in securitatem debiti
The purpose of this article was twofold. We highlighted those aspects of the South African legal framework concerning security rights in movable property that must be reformed for the framework to become legally efficient
Summary
The South African real security (secured transactions) law framework concerning movable property has remained essentially unchanged over the past few decades. The primary source of inspiration used in this article is the United Nations Commission on International Trade Law (UNCITRAL) Legislative Guide on Secured Transactions (UNCITRAL Guide).2 Upon comparing the latter with current South African law, we argue that South African real security law should be reformed to the following effect: A registered pledge should be adopted as the security device through which to encumber any individual movable asset or collection of movable assets, replacing general and special notarial bonds as well as cession in securitatem debiti. Make suggestions regarding how South African law should be reformed to render its secured transactions law framework more legally efficient
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