Research On Legal Issues Of Factoring Contract With Recourse

The factoring contract is a well-known contract newly added in the "Civil Code of the People’s Republic of China".Factoring,also known as a guarantee agent,refers to the fact that the provider of factoring services purchases the creditor’s rights of other people’s accounts receivable,and is responsible for recovering the corresponding creditor’s rights and obtaining profits.Specifically,the factorer obtains profits by purchasing the debts generated by the creditor based on a certain basic contract,and provides one or more services of corresponding financing,sales account management,accounts receivable collection and credit risk control.Factoring with recourse refers to the type of factoring contract that is based on a factoring contract.The factoring contractor and the creditor agree on the type of factoring contract under which the creditor can claim recourse if the creditor cannot repay the financing in the future.This article takes a typical case as an example to analyze the three main controversies in the case:The first question is mainly about the identification of the nature of the dispute in the factoring contract.To determine whether a contract of financing nature between the parties is a factoring contract,it is necessary to determine whether there is an act of transfer of creditor’s rights in the contract,as well as the purpose of signing the contract and both parties to make a comprehensive judgment.Factoring contracts and general creditor’s rights assignment contracts are both related and different.At the same time,given that the factoring contract is a brand-new well-known contract,the article proposes to add an independent cause of "factoring contract" to deal with factoring cases in practice.The second question mainly revolves around the way the factorer exercises the right of recourse and compensation.Factoring contracts can be classified according to whether the factoring party has the right of recourse.In factoring with the right of recourse,if the factoring party exercises both the right of recourse and the right of recourse,can it be supported by the court? The article analyzes this issue in detail,and finally believes that the factor can claim both the right of recourse and the right of compensation,but it cannot exceed the principal and interest of the factoring financing and the necessary expenses that the factor can obtain.At the same time,the exercise of the recourse by the factor is a right rather than an obligation of the factor,and the exercise of the recourse by the factor does not constitute a reversal of the creditor’s rights.The third question is mainly about whether the basic creditor’s rights will affect the effectiveness of the factoring contract.If the basic contract between the creditor and the debtor is flawed,can the creditor and the debtor use this to defend against the factor? This article believes that when the validity of the underlying creditor’s rights contract is undetermined or revocable,it will not affect the factoring party’s right of recourse and recourse;when the underlying creditor’s rights contract is invalid,the debtor should be judged based on whether the factorer’s good faith and fulfilling the necessary review obligations Can you make a defense on this ground?Finally,the article makes the necessary summary,publishes his own detailed opinions on the three main issues of the full text,gives his own answers and reasons,and hopes to provide a method of adjudication for practical cases.