In some jurisdictions, it is common practice for a lender to take security over the shares of a special purpose vehicle (SPV) set up to hold certain assets to secure debts.

In the United States, for example, SPVs are often used to specifically address regulatory issues that prevent creditors from taking a direct security interest in certain assets. In many other jurisdictions, such as Germany, it is common to take security over the shares in an SPV in addition to taking security directly over the debtor's assets.

In other jurisdictions, however, the practice is avoided. For example, in France the preferred route of lenders is to take security over assets to avoid the risk of structural subordination. In China, the law does not recognise the concept of an SPV set up to hold the debtor's assets.

The United States, Germany, France and China Q&As are four of the 29 country-specific Q&A guides appearing in the fully revised and updated edition of the PLC Cross-border Finance Handbook, a multi-jurisdictional guide to finance law and lawyers worldwide. Each Q&A gives a high level overview of lending, taking security over assets, special purpose vehicles in secured lending, quasi-security, guarantees, and loan agreements.

For more information see PLC Cross-border multi-jurisdictional guides.