Factoring
1988 Ottawa Convention on International Factoring: in-depth analysis
By Raphaël MORENON16 July 2025Factoring is a valuable financial management tool for companies wishing to optimise their cash flow by transferring their trade receivables to a specialised institution, the factor. When a company's customers are located abroad, the operation becomes more complex and takes on an international dimension. International factoring and its general legal framework are then faced with a patchwork of national legislation, a source of legal uncertainty. To harmonise practices and facilitate trade, the Ottawa Convention on International Factoring was signed on 28 May 1988. This international agreement proposes a set of uniform rules designed to remove the legal obstacles specific to these transactions. Understanding its scope and mechanisms is essential for any economic player operating internationally. Our firm, with its expertise in banking and finance law, can help you decipher this fundamental text. Background and scope of the 1988 Ottawa Convention The Ottawa Convention...
Disputes between factor and third parties: analysis of legal solutions
Factoring, Banking and stock exchange lawFactoring generates conflicts of rights between the factor and various third parties. In these situations, claims are made against the same receivables or their proceeds. The resolution of these conflicts depends on precise legal principles and nuanced case law. Conflicts with other creditors Chronological priority between creditors The conflict between the factor and...International factoring: legal framework and practical aspects
Factoring, Banking and stock exchange lawInternational factoring meets the growing needs of exporting companies. It secures their cross-border operations while optimising their cash flow. Its legal framework is more complex than that of domestic factoring, and requires in-depth analysis to master its subtleties and risks. The legal framework for international factoring The Ottawa Convention of...The enforceability of exceptions in factoring: risks and protection
Factoring, Banking and stock exchange lawFactoring exposes the factor to a major legal risk: the enforceability of defences. This mechanism allows the assigned debtor to raise defences against the factor that could have been raised against the original creditor. This legal reality complicates collection and can compromise the effectiveness of the financing. The principle and limits...Factoring and insolvency proceedings: protection of rights and obligations
Factoring, Banking and stock exchange lawThe opening of insolvency proceedings disrupts the legal relationships between the parties to a factoring contract. Protecting the rights of each party becomes a crucial issue. How can the effectiveness of the factoring mechanism be preserved in the face of the mandatory rules of insolvency proceedings? What strategies can the parties deploy to secure their position? To...Factoring framework agreement: legal analysis of obligations and guarantees
Factoring, Banking and stock exchange lawThe factoring agreement forms the contractual basis of the relationship between the company and the factor. This framework contract sets out the rights, obligations and guarantees of the parties. Its legal analysis reveals a sometimes delicate balance between the protection of the factor and the interests of the member company. Let's take a look at its key features. Legal features of the factoring agreement...The legal mechanisms of factoring: subrogation and cession Dailly
Factoring, Banking and stock exchange lawFactoring is a strategic financial lever for many companies. For a full understanding of the concept, including its limitations and potential disputes, see our guide to general factoring. This process is based on complex legal foundations that determine the rights and obligations of the parties involved. The security of this operation...What is factoring? Definition, limits, disputes
Factoring, Banking and stock exchange lawFactoring is a popular financial solution for companies faced with long payment terms. This complex legal mechanism combines short-term financing, a guarantee against non-payment and accounts receivable management. Its implementation requires a precise understanding of its legal and financial implications. Understanding factoring...
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