Pledging is a legal transaction whereby a debtor pledges an asset or right (such as movable property, a claim, shares, or an intellectual property right) to their creditor as security for the repayment of a debt. The property or right thus pledged remains in the possession of the debtor, but the creditor has a right of priority in the event of non-payment of the debt, i.e., they may seize and sell the property or right to recover the amount owed.
Pledging is a form of collateral security, as it gives the creditor a right to a specific asset in the event of default by the debtor.
To be enforceable against third parties, the pledge must generally be formalised in a written contract and, in some cases, be registered with the competent authorities or entered in a public register (such as a register of pledges of claims).
In the event of non-repayment of the debt, the creditor may seize the pledged asset, sell it, and recover the amount of the debt, with the possibility of being paid before other non-preferential creditors.
In summary, a pledge is a guarantee whereby a debtor offers an asset or a right as security for their debt. If the debt is not paid, the creditor may request the judicial sale of the asset to recover the amount owed. It may well apply to industrial property rights, in which case the pledge is registered with the Office