Security Property and Clause of Reservation of Title by a Seller. Correlation of the Concepts and Their Position under Russian Law

The research is dedicated to the security property and a reservation clause. The purpose of the study is to analyze the legal regime of the security property and a reservation clause and to determine the correlation of both concepts under Russian civil legislation. The research highlights the most controversial issues concerning the title securitization and presents the dominant solutions provided by scholars. The correlation of the title securitization and a usual security deposit is also investigated. The complex analysis of the reservation clause includes the characteristic of the article 491 of the Civil Code of the Russian Federation and case law concerning the article. Determination of the secured seller`s interest is also a part of this objective. The analysis of the security property is based on some types of the contractual obligations, which are leasing and factoring. Some non-defined in the legislation contracts, establishing the security property, are also the object of analysis. The security property and a reservation clause should be assessed in a negative way. It is established that it is necessary to apply the legal regime of a usual security deposit to the security property and a reservation clause. However, the opportunity to provide such approach to each type of the title securitization is different. A reservation clause could be hardly qualified as a security deposit in the Russian legal order. That is why the application of the institution should be limited. The qualification of the security property as a security deposit is more real. Moreover, there are some issues where the legal doctrine and case law have already recognized such an opportunity. The correlation of the security property and a reservation clause is also covered in the research. The mechanism of the securitization is different in the mentioned concepts. A reservation clause secures only the interest of the seller. The security function is based on that the acquisition of possession and acquisition of the title take place in different moments. The securitization in case of the security property is based on the intentional transfer of the title to the creditor.