Secured Lending and Collateral in Macau: Key Aspects

Macau, a special administrative region of China, has its own unique laws and regulations governing secured lending and collateral. The following article provides an overview of the key aspects of Macau’s law related to this topic.

Restrictive Provisions on Secured Lending

• Personal Guarantees: Companies are generally prohibited from providing personal guarantees for the obligations of other persons, except in cases where there is a direct interest in the company.
• Restrictions on Target: The law restricts the target of secured lending and collateral to ensure that companies cannot provide guarantees without a genuine interest.

Enforcement of Collateral

• Secured Lender’s Rights: Secured lenders have the right to enforce their collateral in accordance with the terms and conditions set out in the loan agreement.
• Collateral Registration: The process of registering collateral is essential for secured lending, as it provides a clear record of the collateral and its ownership.

Jurisdiction and Foreign Laws

• Choice of Law: Macau law generally upholds the choice of foreign law as the governing law of a contract.
• Submission to Jurisdiction: The submission to a foreign jurisdiction is also recognized under Macau law, subject to certain conditions.

Recognition of Foreign Court Judgments

• Recognition Process: Foreign court judgments are recognized in Macau through a special proceeding called “Revision and Confirmation of Foreign Judgments.”
• Exceptions: Certain exceptions apply, including international treaties, agreements under judiciary cooperation, or special laws.