Report from the Commission to the European Parliament, the Council and the European Economic and Social Committee on the question of the effectiveness of an assignment or subrogation of a claim against third parties and the priority of the assigned or subrogated claim over the right of another person

The Capital Markets Union Action Plan concluded that despite significant progress in recent decades to develop a single market for capital, there are still many long-standing and deep-rooted obstacles that stand in the way of cross-border investments. One of the obstacles identified results from differences in the national treatment of third party effects of assignment of debt claims that complicates the use of these instruments as cross-border collateral, particularly when bank loans are mobilised as financial collateral in central bank credit operations or in the context of securitisations, and makes it difficult for investors to price the risk of debt investments.

To facilitate cross-border investment, the Capital Markets Union Action Plan foresees that "the Commission will [...] propose uniform rules to determine with legal certainty which national law shall apply to third party effects of the assignment of claims" and that action will be taken by 2017. This report is the first step in identifying the main problems related to the lack of a uniform rule on the law applicable to the third party effects of assignment and the order of priority of the assigned claim and the possible approaches that could be taken to address those problems.

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