Q&As

Is partial crystallisation of a floating charge possible?

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Published on LexisPSL on 12/05/2016

The following Banking & Finance Q&A provides comprehensive and up to date legal information covering:

  • Is partial crystallisation of a floating charge possible?
  • Crystallisation of floating charges
  • Effect of Crystallisation
  • Why might a chargee wish to partially crystallise its charge?
  • Is partial crystallisation possible?

Is partial crystallisation of a floating charge possible?

Crystallisation of floating charges

A floating charge may Crystallize by operation of law or it may Crystallize in accordance with a contract. Crystallisation by contract can by divided into those events that entitle the lender to give notice of crystallisation and those that result in the floating charge being crystallised automatically.

For more information on how floating charges may crystallise, see Practice Note: Crystallization of floating charges.

Most debentures will clearly set out which events will trigger crystallisation by notice and which will trigger the automatic crystallisation provisions. For more information, see Crystallisation of floating charges — Crystallisation by contract.

Effect of Crystallisation

Once a floating charge has crystallised, the key impact is that the chargor can no longer deal with the floating charge assets without

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