If your jurisdiction does not recognise the role of an agent or trustee, are there any other ways to achieve the same effect and avoid individual lenders having to enforce their security separately?

Lending & Secured Finance

Croatia Small Flag Croatia

One of the solutions to avoid multiple claims of individual lenders is to name all of them as joint creditors in which case each of them is entitled to enforce the whole claim from the debtor, and the debtor is entitled to fulfil his obligation to one of the creditors (who will then distribute the collected amount to other creditors).

Czech Republic Small Flag Czech Republic

Another way to achieve a similar effect and avoid individual lenders having to enforce their securities separately is to appoint a member of the syndicate partners as their trustee/representative.

The member will be able to hold securities for the syndicate partners, enforce the rights of the syndicate partners and apply the proceeds of enforcement to the claims of all lenders. However, the so-called Security Agent acts here in his own name and is liable to the other syndicate partners only internally on a contractual basis.

Therefore, the security agent is very well secured, while the other members of the consortium are less secured because they only have contractual claims against the secured party for participation in the syndicated securities and not against the borrower or security giver.

Finland Small Flag Finland


Germany Small Flag Germany

German law does recognise agent and trustee roles.

Spain Small Flag Spain

Security trustee structures are a common feature of international syndicated transactions. In order to avoid the enforcement by individual lenders separately, the enforcement by the security agent should be regulated in the relevant security agreement and all lenders must grant powers of attorney (duly legalized with the “Apostille” pursuant to The Hague Convention of October 5, 1961, in case of foreign lenders), in favour of the security agent.

Philippines Small Flag Philippines

As explained in the discussion on item 13, the appointment of an agent or trustee in a syndicate is recognized in this jurisdiction.

Sweden Small Flag Sweden

Please refer to question 13.

Turkey Small Flag Turkey

As stated above, a syndicate may choose to appoint (i) a Turkish or non-Turkish entity as security agent, or (ii) a non-Turkish entity as security trustee. Please refer to Question 13 for further details.

United States Small Flag United States

Not applicable.

Switzerland Small Flag Switzerland

See 13 above.

In this context, it is noteworthy that, parallel debt structures have not been tested under Swiss law or in Swiss courts and, therefore, there is no certainty that a security interest based on parallel debt obligations will be held enforceable in Switzerland.

United Kingdom Small Flag United Kingdom


Jersey Small Flag Jersey

This is not applicable, see our comments above.

Hong Kong Small Flag Hong Kong

Not applicable.

Austria Small Flag Austria

As described above under question 13, Austria recognizes the role of an agent and trustee. For further information, please see above, question 13.

Mexico Small Flag Mexico

Please see previous answer.

Bosnia & Herzegovina Small Flag Bosnia & Herzegovina

There have been cases in practice where a “security agent” has been appointed to hold security on the syndicate’s behalf. In such cases the “security agent” concluded the security agreements as the secured creditor and was registered as such with the relevant institution.

Updated: June 5, 2019