MUTUAL CREDIT FUNDS
LexInter | August 6, 2012 | 0 Comments

MUTUAL CREDIT FUNDS

[  UCITS  ] [MUTUAL CREDIT FUNDS] [  SCPI  ] [  ALTERNATIVE MANAGEMENT  ]

SECURITIZATION

Art. L. 214-43. –
The common receivables fund is a joint ownership which has the exclusive purpose of acquiring receivables and issuing shares representing these receivables.
The fund may have two or more sub-funds if its regulations so provide. Each sub-fund gives rise to the issue of units representing the fund assets allocated to it.
The fund does not have legal personality. The provisions of the Civil Code relating to joint ownership, nor those of Articles 1871 to 1873 of the same code relating to joint-venture companies, do not apply to common debt funds.
The conditions under which the fund may acquire debts and issue new units after the initial issue of units and the investment rules for sums currently available and pending allocation are defined by decree. The fund or, where applicable, the compartments of the fund may borrow under conditions set by decree.
The units may give rise to different rights on capital and interest.
They cannot give rise, by their holders, to a request for redemption by the fund. The minimum amount of a unit issued by a common debt fund is defined by decree.
The fund or, as the case may be, the sub-funds of the fund may not assign the receivables that they acquire until they are due or forfeited, except in the event of liquidation under conditions defined by decree. He cannot pledge the debts he holds.
The assignment of receivables is effected by the sole delivery of a slip, the details of which are fixed by decree. It takes effect between the parties and becomes enforceable against third parties on the date affixed on the slip when it is delivered. The delivery of the slip automatically entails the transfer of securities guaranteeing each claim and its enforceability against third parties without the need for any other formality.
The transfer agreement may provide, for the benefit of the transferor, a claim on all or part of the possible liquidation surplus of the fund or, where applicable, of a sub-fund.
For all transactions carried out on behalf of the co-owners, the designation of the fund or, where applicable, of a sub-fund may be validly substituted for that of the co-owners.Art. L. 214-44. –
A document containing an assessment of the characteristics of the units that the fund is called upon to issue and of the debts that it intends to acquire and evaluating the risks presented by the latter is drawn up by a body appearing on a list drawn up by the minister in charge. of the economy after the opinion of the Commission des Opérations de Bourse. It is appended to the prospectus and communicated to unit subscribers.
Mutual funds of receivables cannot be the subject of canvassing.

Art. L. 214-45. –
The common debt funds must communicate to the Banque de France the information necessary for the preparation of monetary statistics.

Art. L. 214-46. –
The recovery of assigned receivables continues to be provided by the ceding institution, under conditions defined by an agreement signed with the management company of the common receivables fund.
However, all or part of the recovery may be entrusted to a credit institution or to the Caisse des Dépôts et Consignations, as soon as the debtor is informed by ordinary letter.

Art. L. 214-47. –
The common debt fund is set up on the joint initiative of a company responsible for managing the fund and a legal person who is the custodian of the fund’s assets.
The fund management company must be approved by the stock market operations commission which may, by reasoned decision, withdraw its approval.
This management company and the legal entity depositary of the assets draw up a note intended for the prior information of subscribers on the transaction, in accordance with the provisions of Articles L. 411-1, L. 411-2, L. 412-1 and L. 621-8.
A decree fixes the nature and characteristics of the debts that can be acquired by the mutual funds of debts and guarantees against the risks of default of the debtors of these debts.

Art. L. 214-48. –
I. – The company in charge of the management mentioned in article L. 214-47 is a commercial company, the exclusive object of which is to manage mutual funds of receivables. She represents the fund vis-à-vis third parties and in any legal action, both in demand and in defense.
II. – The legal person who is the custodian of the fund’s assets mentioned in Article L. 214-47 is a credit institution or any other institution approved by the Minister responsible for the economy. It must have its head office in France. It is the custodian of cash and receivables acquired by the fund. It ensures the regularity of the decisions of the management company.
III. – Unitholders are only liable for the debts of the fund to the extent of its assets and in proportion to their quota.
IV. – The fund regulations provide for the duration of the accounting years, which cannot exceed twelve months. However, the first exercise may extend over a longer period without exceeding eighteen months.
V. – Each compartment of the fund is subject to separate accounting within the fund’s accounts.
Within six weeks of the end of each six-month period of the financial year, the management company draws up, for each of the funds it manages, an inventory of the assets under the control of the depositary.
VI. – The fund’s statutory auditor is appointed for six fiscal years by the board of directors, the manager or the executive board of the management company, after approval by the stock market operations commission.
The provisions of articles L. 225-218 to L. 225-227, L. 225-237, L. 225-238, the second and third paragraphs of article L. 225-240, articles L. 225-241 and L. 225-242 of the Commercial Code are applicable to it.
The statutory auditor reports to the managers of the management company as well as to the stock market operations commission any irregularities and inaccuracies that he finds in the performance of his duties.
The unitholders of the fund exercise the rights granted to shareholders by Articles L. 225-230 and L. 225-231 of the Commercial Code.

Art. L. 214-49. –
Within six months following the extinction of the last claim of the fund or, where applicable, of a sub-fund, the management company proceeds to liquidate the fund or this sub-fund.

Amended regulation number 94-01 relating to debt mutual funds, COB monthly bulletin, n ° 355, 03/01/2001, pp. 39-48Commentary on the publication of regulation number 2000-05 amending regulation number 94-01 relating to common debt funds published in the Official Journal of December 22, 2000, COB monthly bulletin, n ° 353, 01/01/2001, pp. 13-14

Instruction of June 15, 1999, issued in application of amended regulation 94-01 relating to common debt funds, COB monthly bulletin, n ° 336, 01/06/1999, pp. 33-58

Securitization of future receivables, Xavier de Kergommeaux; Grégory Benteux,, Banking and Stock Exchange Law Review, n ° 2, 03/01/2000

A relaxed legislative framework for common debt funds, Xavier de Kergommeaux, Option Finance, n ° 556, 12/07/1999, p 37

Securitization of trade receivables: the offensive of French banks, Perrignon, Bertrand, Marchés et Techniques Financières-Haute Finance (MTF), 05/01/1999, p 15

 

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