Document background
The Collateral Assignment Agreement is a crucial security document in German financing transactions, used when a party (assignor) wishes to provide certain assets as security to a creditor (assignee). This document type is governed by the German Civil Code (Bürgerliches Gesetzbuch) and must comply with specific German law requirements regarding the creation and perfection of security interests. It is commonly used in loan transactions, project finance, asset finance, and general corporate financing where assignable assets (such as receivables, contract rights, or insurance claims) serve as collateral. The agreement must precisely identify the assigned assets and include specific provisions required under German law for the security interest to be valid and enforceable. This document type is particularly important in the German market as it provides an effective security mechanism while accommodating German law's strict requirements for security interests.
