Mortgage Related to Leased or Borrowed Assets
Based on Article 34 of Decree 21/2021/ND-CP (effective from May 15, 2021), the provisions are as follows:
In the case where the mortgaged asset is being leased or borrowed, the mortgagor is required to notify the mortgagee.
The handling of the mortgaged asset that is being leased or borrowed as stipulated in Article 299 of the Civil Code does not terminate the lease contract or the borrowing contract; the lessee or borrower is entitled to continue leasing or borrowing until the contract term expires.
In the case where the mortgage measure has come into effect against third parties, and the mortgagor rents or lends the mortgaged asset without notifying the mortgagee, the lease contract or borrowing contract shall terminate at the time of handling the mortgaged asset. The rights and obligations between the mortgagor and the lessee or borrower are resolved according to the agreement in the asset lease contract, asset borrowing contract, the provisions of the Civil Code, and other relevant laws.
Respectfully!
