Abstract

South Africa and Belgium have acknowledged the economic need for legal reform of the law regulating real security rights over movable property. South Africa enacted the Security by Means of Movable Property Act 53 of 1993 (SMPA), which provides for a fictitious pledge, and Belgium enacted the new Belgian Pledge Act 11 of 2013, which provides for a registerpand. This article examines the historical background, development and legal reform of non-possessory real security rights over movables in both legal systems. The research focuses on the difference in the legal position regarding the security object of the non-possessory real security right and court intervention in realising the security. South African law excludes incorporeal property, revolving assets, and future property from the strong legal protection offered to debtors and creditors by the SMPA. Belgian law, by contrast, has an inclusive as opposed to exclusive approach to the legal nature of the security object. The new Belgian Pledge Act is applicable to all corporeal and incorporeal movable property. The position of summary execution clauses under the new Belgian Pledge Act is the opposite of that under South African law. The South African summary execution clauses principle, as developed in Roman-Dutch law, has in recent years been interpreted more strictly with the result that its application is limited. The aim of the Belgian reform is to simplify the creation and realisation of a ‘pledge without possession’. The Belgian Pledge Act now grants the pledgee the right to sell, rent, or appropriate the security object without court intervention. Court intervention is only required if the pledgor is a consumer.