A cession is ... A sample cession agreement between legal entities

Cession is a special civil relationship with a specific structure. The key elements in it are the object and subject. Let us further consider what distinguishing features cession has, what it is in simple words.

general characteristics

Assignee and assignor act as subjects in the emerging relationship. The latter is inferior to its own right. It can be both an organization and a citizen. In fact, the assignor represents the creditor's side. In practice, however, there are cases when it is recognized not as the active party to the obligation, but as a party to the agreement.

Cession: what is it in simple words?

The deal is assignment or legally owned property. In international practice, cession is the transfer of part of the territory by one state to another by mutual agreement. In Russia, the assignment of rights is carried out in respect of receivables. Assignment is, in fact, the sale of debt of third parties.

Agreement

The assignment agreement between individuals provides the following conditions. One entity transfers to the second the rights that it owns to demand repayment of the debt from a third party - the debtor. You can enter into an assignment agreement as part of an insurance agreement. Under the terms of the transaction, the insurer transfers part of the risks with a certain share of the premium. A cession between legal entities is considered to be typical, in which the bank cedes the right to demand debt to the collection agency. However, the legislation is currently tightening control over such transactions. In 2012, the Armed Forces changed the direction of the practice of assigning claims under credit agreements. In fact, it was forbidden to transfer debt to an organization that does not have a banking license without agreement with the debtor.

Sample assignment agreement between legal entities

It can be executed as an independent document. Legislation also allows for the inclusion of terms of assignment in the underlying agreement. The types of contracts in accordance with which the transfer of rights under the transaction is carried out are not normatively defined. At the same time, their scope is quite extensive. The legislation has a number of requirements for the execution of the agreement. A sample assignment agreement between legal entities must contain the required details:

1. Names of entities signing the agreement.
2. Date and place of compilation of the document.
3. Signatures of authorized representatives and stamps of organizations.

The content of the agreement describes the conditions under which the assignment is made. This is necessary to prevent misunderstandings between all participants. Assignment of rights may pursue different goals and be carried out on various grounds. If the agreement does not indicate them, this does not indicate the invalidity of the transaction. Particular attention should be paid to the form of the document. It should be identical to the original agreement. For example, if the original contract was concluded in the usual written form, then the cession should be executed in the same way. If the original agreement was subject to and registered, the new document is also subject to this procedure. If the original contract was notarized, the assignment is subject to the same certification.

Debtor Notification

As a general rule, the legislation does not establish the obligation of the original and new creditor to obtain the consent of the obligated subject to commit the assignment of rights.An exception is the case when for the debtor the personality of a new participant in the relationship is significant. The normative acts do not contain a requirement from creditors to notify the obligated entity that a cession has been committed (between individuals or organizations). However, there is a warning in the regulations. In particular, the law says that if the debtor was not notified in writing about the complete transfer of rights, the new creditor will bear the risk of possible adverse consequences. So, for example, the obligated person, not knowing about the change of participants, can continue to transfer the debt to the account of the main creditor. The new member, accordingly, will not receive their money. But, if the creditors did not inform the debtor of the assignment, such actions of the obligated person cannot be challenged.

Features of transfer of rights

The assignment agreement is concluded on an ongoing basis. This means that the right of claim cannot be transferred for some time. At the same time, the transaction may concern continuing obligations. For example, this may be an assignment of a claim under a supply, supply, etc. contract. It should be noted that previously such agreements were considered invalid in arbitration practice. However, the situation subsequently changed. So, in one of the decisions of the Supreme Arbitration Court it is indicated that the subject of the assignment is not the entire volume of bilateral obligations to supply gas, but only a certain requirement to pay for raw materials for a specific billing period.

The specifics of the obligation

Under a cession agreement, rights are transferred to the new creditor in the same amount as the original entity had. They come from a specific obligation arising from the terms of the transaction. Within the framework of the main contract, several methods of debt repayment can be provided. For example, it is established that the debtor is required to perform a certain action. This may be the transfer of any property, money, etc. Also, the conditions of the transaction may provide for abstinence from the commission of an action. At this creditor accordingly, it receives the right to demand the performance of an obligation.

Bans

The legislation establishes certain restrictions on the assignment. In particular, may not be subject to assignment personal non-property rights. For example, a creditor cannot transfer the right to collect child support, compensation for harm to health. These obligations arise from non-property relationships. Accordingly, they relate directly to the identity of the creditor. In addition, a cession cannot be committed with respect to a number of property rights. These include, for example, the primary opportunity to acquire a share of common property. Assignments cannot be transferred exclusive rights on products of intellectual activity and trademarks.

Inadmissibility of assignment

The original contract between the creditor and the debtor may provide for a clause prohibiting cession. The inadmissibility of a concession may be drawn up as a separate document. In some cases, there is a direct prohibition on cession in certain respects in the legislation. For example, such provisions apply to the assignment of rights of claim to financial agents, as well as to the committent of the opportunities that arise from the transaction of the commission agent with a third party if the latter does not fulfill his obligations. In the absence of these grounds, it is necessary to recognize the admissibility of the assignment.

Right transition moment

When making the assignment, the assignor (the original creditor) loses the opportunity to require the debtor to fulfill the obligation. This, among other things, means that any subsequent assignment of one’s right will be considered illegal. The current regulatory acts do not establish any special provisions in relation to the moment of direct transfer of legal opportunities from the original to the new creditor.It follows that the assignee obtains his rights upon conclusion of the contract. An exception should be considered:

1. Transfer of future rights. They will transfer to a new lender only at the time of their occurrence.
2. Conclusion of an assignment agreement suspensive condition. In this case, the transfer of legal capacity will be carried out upon the occurrence of certain circumstances.
3. Situations when participants in the initial transaction provided for another moment of transfer of rights, other than the date of conclusion of the contract.

Debtor's actions

After the assignment, the obligated person cannot repay the debt in favor of the original creditor. After the debtor has received the corresponding written notice, he fulfills the terms of the transaction with respect to the new participant. Legislation allows him to demand from the creditor evidence that a cession has been committed. The latter, in turn, must possess all the information and have all the relevant documents relating to the transaction.