Pledge is when the debtor or a third party transfers the possession of a certain property to the creditor, and the latter takes possession of the property as a guarantee for the former to perform certain payment of money or performance obligations. When such liability is discharged, the pledged property must be returned. When the debtor fails to perform its obligations, the creditor has the right to discount or auction the pledged property in accordance with the law, and has priority in receiving payment of the proceeds.
The most common pledge is the transaction between the parties and the pawnshop. China's Guarantee Law stipulates that pledges are divided into two types: movable property pledges and rights pledges. The rights that can be used as pledge include: bills of exchange, checks, promissory notes, bonds, deposit receipts, warehouse receipts, and bills of lading; shares and stocks that can be transferred in accordance with the law; property rights in trademarks, patents, and copyrights that can be transferred in accordance with the law; property rights in copyrights that can be transferred in accordance with the law; Other rights of pledge.
Lifting a pledge is the release of a pledge. Pledge is a type of guarantee.
Article 208 of the "Property Rights Law" stipulates: "In order to guarantee the performance of a debt, the debtor or a third party pledges his movables to the creditor for possession, and the debtor fails to perform the due debt or the realization of the pledge rights as agreed by the parties occurs. In such circumstances, the creditor shall have priority in receiving payment for the movable property. The debtor or third party specified in the preceding paragraph shall be the pledger, and the creditor shall be the pledgee, and the delivered movable property shall be the pledged property.
Extended information:
Characteristics of pledge
1. It has the same characteristics as all security rights - subordination, indivisibility and physical subrogation
2. ．The subject matter of the pledge is movable property and transferable rights, and the pledge of real estate cannot be established. Therefore, the pledge is divided into movable property pledge and rights pledge.
Money can also be pledged after being specified: After the debtor or a third party specifies its money in the form of a special account, a deposit, a deposit, etc., it is handed over to the creditor as a guarantee for the creditor's rights. If the debtor fails to perform the debt, the creditor can use the money to receive payment first.
3. A pledge is a security right that transfers the possession of the pledged property, and the possession of the subject matter is the essential condition for the establishment of the pledge.
Reference: Baidu Encyclopedia - Pledge