afridi-angell – Page 28 – Afridi & Angell

Centre for Amicable Settlement of Disputes can no longer mediate disputes when a bank is a party to such dispute

The Centre for Amicable Settlement of Disputes (the “Centre”) was established by Dubai Law No. 16 of 2009 and is entrusted with the task of attempting to mediate disputes, prior to such disputes being referred to court. The Centre is affiliated with the Dubai Courts and the mediators appointed in the Centre act under the supervision of a judge. If the parties reach a settlement, such a settlement must be recorded in writing, signed by the parties and attested by a judge. Such settlement agreement is legally enforceable and is equivalent to an executive instrument which may be directly enforced through the Execution Courts. In the event no settlement is reached between the parties, the case is referred to court.

The Centre acquires jurisdiction over a dispute either on the application of a party to a dispute or when the dispute relates to a subject specified in Dubai Law No. 16 of 2009 to be a dispute that must be first reviewed by the Centre prior to the dispute being referred to court. However, there are certain disputes that the Centre does not have jurisdiction over (such as Labour disputes, disputes relating to personal status, summary and interim orders and actions, actions to which the Government of Dubai is a party, etc.).

A party to a dispute may opt to refer a dispute to the Centre under the following circumstances:

1. If a party (or parties) to a dispute request that the dispute be referred to the Centre;

2. On the request of all parties to a dispute which is pending before the Dubai Court of First Instance, Commercial Courts or Real Estate Courts (regardless of the value of the suit), upon the approval of the chief judge of the circuit;

3. On the request of a party for the appointment of an expert.

The following disputes are disputes that must be reviewed first by the Centre prior to the case being referred to court:

1. Division of undivided property;

2. If the value of the debt in the dispute does not exceed AED 100,000.

Prior to Administrative Decision No. 1 of 2017, all disputes to which a bank was party had to be first referred to the Centre. Such disputes were rarely, if ever, settled and the dispute resolution process was merely prolonged unnecessarily. However, consequent to Administrative Decision No. 1 of 2017, the Centre no longer has jurisdiction over any dispute to which a bank is a party. The significance of this amendment is that no dispute that a bank is a party to can be referred to the Centre, even for the limited purpose of appointing an expert to opine on a matter. Therefore, all disputes where a bank is a party must be referred directly to court. ■

New decree on mortgaging granted lands in Dubai

On 11 January 2017, Dubai Decree No. 31/2016 On Mortgaging Granted Lands in Dubai was issued (Decree).

The Decree permits the holder of “granted land” to mortgage such land subject to certain conditions. It is expected that the Decree will stimulate growth in Dubai by enabling developers, who hold granted land, to obtain finance for their projects by mortgaging the granted land.

The Director General of the Dubai Land Department (DLD), Sultan Butti Bin Merjren, has said that the Decree is a key legislative initiative that will have a positive impact on the real estate market.

What Is “Granted Land”?

“Granted land” is land which has been gifted by the Ruler of Dubai to a UAE national, at no cost, for:

• commercial or industrial purposes; or

• residential purposes.

Granting land in this manner furthers Dubai’s leadership vision of ensuring a dignified life for its citizens by enabling commercial and industrial assets to be developed, as well as homes to be built.

Granted land is not freehold land and is subject to various restrictions. For example, granted land cannot be disposed of unless:

• the UAE national obtains special permission from the Ruler of Dubai; or

• in case of commercial and industrial land, the UAE national converts their granted title to freehold upon payment of a fee and in accordance with Decree No. 4 of 2010 on Regulating Ownership of Land Granted for Industrial and Commercial Purposes in Dubai.

Key Features of the New Decree

The Decree permits a holder of granted land to mortgage that land under the following conditions:

• if the granted land is residential, the monies arising from the mortgage must be invested in maintaining, expanding, constructing or replacing the building;

• if the granted land is commercial or industrial, the monies arising from the mortgage must be invested to achieve the purposes of the original grant; and

• the mortgage must be registered with the DLD.

The DLD can only register a mortgage over granted land if:

• the borrowed amount will be used to achieve the purpose for which the land was granted; and

• the mortgagor has a construction license issued by a competent authority.

If a mortgagor defaults, the Decree provides mortgagees with a legal right to sell the granted land at public auction (and under the supervision of the DLD) provided that 30 days’ notice is given to the mortgagor to rectify the default.

All disputes relating to mortgages over granted land are to be heard through the Civil Court.

What Changes Compared to the Old Rules?

The Decree follows previous Orders and Instructions in relation to mortgaging granted land as set out below.

• Instructions issued on 20 September 1994 from the Ruler of Dubai – By these instructions, all mortgages over granted land were strictly prohibited, and any mortgage made in violation of this instruction was considered absolutely null and void.

• Order issued on 14 May 1996 from the Ruler of Dubai – By this order, granted land (whether residential or commercial) could be validly mortgaged.

• Instructions issued on 5 June 1996 from the Ruler of Dubai – By these instructions, a mortgage over granted land could only be registered at the DLD if:

o the DLD had verified that:

 the amount of the mortgage was used for the construction of a building on the granted land; and

 payment of the mortgage funds had been made in such a way that ensured the mortgage was used for its intended purpose;

o the mortgagor had a building license for the commercial development; and

o the mortgagor had obtained a no-objection letter from the Ruler of Dubai permitting the mortgage of the granted land.

It is important to note that the Decree provides that all prior regulatory measures that are inconsistent with the Decree’s provisions will be repealed, including the above.

Why Is the Decree Important?

It is expected that the Decree will stimulate growth in Dubai by:

• enabling developers, who hold granted land, to obtain finance for their projects by mortgaging the granted land; and

• encouraging banks to lend against granted land by providing them with:

o a legal right to sell the granted land at public auction (and under the supervision of the DLD) if the mortgagor defaults; and

o a dispute resolution process.

However, it is likely that further regulations will need to be issued to govern the implementation of the new Decree. ■

Companies law compliance

The new Commercial Companies Law was enacted as Federal Law No. 2 of 2015. It gave existing companies until 1 July 2016 to achieve compliance with its terms. Article 374 provides that a further one-year extension could be granted by Resolution of the Cabinet, and such an extension was in fact granted. Article 374 also provides that a company that fails to achieve compliance shall be deemed dissolved.

Many companies set about amending their constitutive documents (Contracts of Establishment for limited liability companies and Memoranda and Articles of Association for joint stock companies) to achieve compliance with the new requirements. Shareholders of limited liability companies were assisted somewhat by Ministerial Resolution No. 272 of 2016, which specified which provisions of the Commercial Companies Law on joint stock companies would also apply to limited liability companies.

A new resolution of the Minister of Economy, Ministerial Resolution No. 694 of 2016, now provides further relief. It states that Contracts of Establishment of existing limited liability companies that are not amended by the deadline shall be deemed amended to the extent necessary to achieve compliance. One could question whether the Commercial Companies Law gave the Ministry the power to grant this relief from compliance. Executive measures cannot modify legislative measures absent enabling legislation. Nevertheless, the practical result is that such companies no longer face the prospect of dissolution, fines or other sanctions for failure to comply.

The new measure applies to general partnerships and limited partnerships as well as limited liability companies. It does not apply to the other forms of companies that exist under the Commercial Companies Law, the private joint stock company and the public joint stock company.

Although sanctions relief is welcome, some uncertainty remains, and not only because of the inherent limitations on executive power noted above. The parties to a Contract of Establishment that is deemed amended could still be unsure of where they stand. The Contract of Establishment will no longer mean what it says, and an authoritative determination of its actual meaning may be elusive. Although major substantive problems would seem unlikely, it is not ideal for a corporate document not to mean what it says.

In contrast, the companies that have amended their Contracts of Establishment do not face this ambiguity. Their amended documents would have been notarized and filed with the authorities, making it unlikely that the new Resolution would impose further amendments.

To illustrate the issues that might arise, the new Commercial Companies Law requires that a register of shareholders be maintained by the company, including such particulars as the full name, nationality, date of birth and place of residence of each shareholder. The date of birth was not previously required. Even a company that does not amend its constitutive documents should amend its register of shareholders so as to include this new information.

As a further example, the new law slightly changes the requirements for exercise of preemption rights when a share transfer is contemplated. When a shareholder in an LLC wishes to sell its shares, it must first make an offer on the same terms to the other shareholders, or alternatively obtain a waiver of the preemption right from the other shareholders. In the event of a dispute over the price, the new Commercial Companies Law requires that the price be determined by one or more experts nominated by the Competent Authority in the relevant Emirate. The previous Commercial Companies Law (and many constitutive documents of companies formed in the UAE) provided that this value would be determined by the company auditor. An expert appointed by the Competent Authority will now play that role, whether or not the underlying constitutive documents are amended.

The new Commercial Companies Law contains an express prohibition against a manager of a limited liability company acting as manager of a competing enterprise without the consent of the company. This exposes a manager to liability even if the prohibition is not stated in the constitutive documents of the company.

As a final example, a shareholder in a limited liability company is now able to pledge its shares. However, this is possible to the extent that the constitutive documents enable the same. It is unlikely that a provision to this effect would be deemed included in the company’s constitutive documents by virtue of the new Resolution.

The new Resolution was published in Issue No. 612 of the UAE Federal Official Gazette dated 28 February 2017, and it took effect on 1 March 2017. ■

New UAE funds regime

The UAE has embarked on an ambitious undertaking by introducing new business friendly mutual funds regulations to stimulate the UAE funds industry and provide the foundation for a more developed regional funds regime in the Gulf Cooperation Council (the “GCC”). The mutual funds industry can facilitate the gathering of monies for investment in various sectors across the UAE and Middle Eastern economies through funds that are established in the UAE, as well as foreign funds that are registered and promoted in the jurisdiction.

The Emirates Securities and Commodities Authority (“SCA”) has recently issued the following new regulations governing the registration, licensing, and promotion of mutual funds in the UAE (the “Fund Regulations”):

1. SCA Board Decision No. 9 of 2016 regulating mutual funds;

2. SCA Board Decision No. 10 of 2016 setting out fees related to mutual funds;

3. SCA Administrative Decision No. 49 of 2016 regulating exchange traded funds (“ETFs”);

4. SCA Administrative Decision No. 52 of 2016 regulating cash investment funds;

5. SCA Administrative Decision No. 1 of 2017 regulating real estate investment trusts (“REITs”);

6. SCA Administrative Decision No. 2 of 2017 regulating private ownership funds;

7. SCA Administrative Decision No. 3 of 2017 regulating venture capital funds; and

8. SCA Board Decision No. 3 of 2017 regulating promotion and arranging activities.

The Fund Regulations constitute the new UAE fund regime regarding onshore local funds and foreign funds that are marketed in the UAE (outside of its financial free zones). Such regulations replace SCA Board of Directors Decision No. 37 of 2012 concerning the regulations on mutual funds (the “2012 Regulations”).

In addition to revamping the primary mutual fund law that applies to all UAE funds, the Fund Regulations set out additional obligations and key exemptions for certain funds, including REITs, ETFs, private equity funds, and venture capital funds. This marks a significant change from the 2012 Regulations, which failed to differentiate between varying types of local funds, and should encourage fund managers and other sponsors to establish funds in the UAE.

Mutual Funds

As with the 2012 Regulations, the Fund Regulations apply to all mutual funds and parties that are “related” to mutual funds.

A “mutual fund” is defined as a financial pool engaged in the activity of accumulating investors’ assets for the purpose of investment against the issue of fund units of equal value. SCA interprets this definition broadly.

Corporate Structure

A local mutual fund must be established by an eligible sponsor, which includes companies licensed by SCA “in the area of securities” or to manage funds, local and foreign banks licensed by the UAE Central Bank, and UAE branches of foreign companies licensed by an International Organization of Securities Commissions regulator and having an operating history of at least five years. The sponsor must contribute a minimum share capital of AED 5,000,000 and cannot own more than 30% of the fund units.

While UAE Law No. 2 of 2015 (the “Companies Law”) contemplates local funds having corporate personality, it does not prescribe a specific form for funds. As with the previous regime, a UAE fund is established through the contractual relationship between the sponsor and its investors, and each investor will have a balance sheet entry in the accounts of the fund administrator (which must meet comparable eligibility requirements as those of the sponsor).

The Fund Regulations provide that the contractual relationship will benefit from limited liability (i.e. up to the amount invested) and impose certain conditions related to the fund units (e.g. preventing pledging assets of the fund to satisfy third party debts and allocation of units by heirs or creditors). Furthermore, a fund sponsor is only required to obtain SCA approval to establish a local fund; accordingly, there is no need to obtain a separate operating license for the fund with any economic department in accordance with the Companies Law.

Types of Local Funds

The Fund Regulations provide for (or otherwise contemplate) the following types of funds:

• public and private funds;

• master/feeder funds and umbrella fund/sub-funds;

• open ended and closed ended funds; and

• specialty funds, including Islamic funds, REITs, venture capital funds, private equity funds, ETFs, and cash investment/money market funds.

The provisions related to these funds are based on the Undertakings for Collective Investment in Transferable Securities (UCITS) model, which creates a harmonized regulatory regime that permits funds to be sold to any investor in the European Union. While the GCC states have not adopted a comparable framework, it appears that the Fund Regulations have been prepared with this possibility in mind. ■

* * *

The new Fund Regulations mark the beginning of a new chapter in the UAE funds regime and should contribute to the growth of the UAE and the broader region by fostering more efficient and transparent investment structures.

Financing Islamic Banks in the UAE, Islamic Finance News

While it is now abundantly clear that the Sukuk market has failed to realize the predicted surge in sovereign Sukuk issuances following the drop in the prices of oil in 2014, when it was assumed that oil revenue-dependent GCC
countries would rush to the Sukuk market in order to fill shortfalls in their spending budgets, the current Sukuk market still presents a mixed picture. Against the backdrop of the current uncertainty in the Sukuk market, Rahat Dar looks at some of the likely drivers, challenges, and prospects for UAE Islamic banks looking to issue Sukuk in 2017 and beyond.

Employment & Labour Law (UAE)

This country-specific Q&A provides an overview of employment and labour law in the United Arab Emirates (UAE). It will cover termination of employment, procedures, protection for workers, compensation as well as insight and opinion on the most common difficulties employers face and any upcoming legal changes planned.

This Q&A is part of the global guide to Employment & Labour

Getting a Grip on Movables, The Oath

The Federal Law No.20 of 2016 introduces a whole new regime for registering a security interest movable assets in the UAE.

A Guide to Doing Business in Iran

This is a general guide to certain laws applicable to doing business in Iran. The information contained in this publication is given by way of general reference only, is not intended to provide legal advice, and is not to be relied upon in any factual situation as it does not cover all laws or regulations that may be applicable in all circumstances. No responsibility will be accepted by the authors or publishers for any inaccuracy or omission or statement that might prove to be misleading. You are advised to seek your own professional advice before proceeding to invest or do business in Iran.

Changes to anti-corruption regulation in the UAE

Changes to the UAE Penal Code (Federal Law No. 3 of 1987) (the “Penal Code”) at the end of 2016 have (i) extended the current bribery provisions to include bribery involving a foreign public official or an official of an international organisation, (ii) increased the penalties for committing a bribery-related offence and (iii) criminalised the offering of a bribe in the private sector.

General Overview of Anti-Corruption Regulation

Since 1987, the Penal Code has contained prohibitions against bribery, making it an offence to bribe a public official in consideration for an act on the part of that official. A bribe could be anything of value. Offering or promising a bribe was also prohibited, as was the solicitation or acceptance of a bribe on the part of a public official. A public official could be an employee of the government or a person tasked with an official duty. An offence would be committed even if the official’s act was not part of his or her official duties, and even if the official did not actually intend to commit the act. In December 2005, the solicitation or acceptance of a bribe on the part of an employee in the private sector was also prohibited.

Changes to the Penal Code

The recent amendments to the Penal Code have brought anti-corruption regulation in the UAE more in line with other jurisdictions by the inclusion of “foreign public officials”.

Foreign public official is defined as “any person in a legislative, executive, administrative or judicial position [in] another country, whether permanently or temporarily, be elected or appointed, and whether with or without pay and any person entrusted with a public service”.

Both individuals and companies can be found to be liable for bribery of a foreign public official, as the relevant provisions of the Penal Code apply to anyone (whether a natural or legal body).

Crucially, the Penal Code provisions also now apply outside the territory of the UAE to any person who commits any of the bribery offences set out in the Penal Code, if the criminal or victim is a UAE citizen or if the crime is committed by an employee of the public or private sector of the UAE or if it involves public property. (Public property is defined as “(i) property that is fully or partially owned by any of the federal or local authorities, federal or local public establishments or institutions or companies owned, either wholly or partially, by the federal Government, local governments, societies and associations of public welfare and (ii) any property that is subject to the management or supervision of any of the entities set forth in paragraph (i) or of which it has the right to use or exploit”).

In addition, bribery involving an official of an international organisation has been prohibited.

Finally, the prohibition against bribery in the private sector has been expanded. Previously, the offence of private sector bribery was limited to the solicitation or acceptance of a bribe by a private sector individual. Now, it is also a criminal offence to offer a bribe to a person working in the private sector.

Consequence of Committing an Offence

There are various punishments for committing an offence under the bribery provisions, as follows:

• Imprisonment for any public official, foreign public official or official of an international organisation who demands or accepts a bribe. This now means that the relevant bribery provisions apply to non-UAE nationals and entities engaging in acts of bribery.

• Up to five years imprisonment for (i) anyone who offers a bribe to a public official, a private sector manager, a foreign public official or an employee of an international organisation and (ii) any person that has acted as a mediator between the briber and the receiver.

• A fine equal to the amount of the bribe (but which shall not be less than AED 5,000) for any of the above offences.

• Any gifts accepted or offered as a bribe will be confiscated.

The briber or mediator can be exempt from the above punishments if he informs the relevant judicial or administrative authorities of the crime, but only so long as he does so before the crime is discovered.

There is no time restriction on a civil or criminal lawsuit being taken against any individual or company having been found to have committed bribery offences.

Conclusion

The changes to the bribery provisions of the Penal Code are a significant change to anti-corruption regulation in the UAE. The Penal Code is now more wide ranging than before, extending to foreign as well as domestic bribery, and covering the public sector, international organisations and the private sector. ■

New UAE pledge law over movable assets

Overview

The new Pledge Law of the UAE was enacted on 12 December 2016 as Federal Law No. 20 of 2016. The Pledge Law was published in the Federal Official Gazette on 15 December 2016 and will become effective on 15 March 2017. The Pledge Law introduces a new regime for registering a pledge over movable assets which are pledged as security for the repayment of a debt. Whilst the Pledge Law provides some helpful guidance on the type of movable asset pledges that can be registered and the effects of registration, the key administrative details regarding the administration of the pledge register, including the entity that will establish and operate the register, the format of the pledge contract that will be registered and the registration procedure and fees will be outlined in the Executive Resolutions to the Pledge Law; which will be issued by the UAE Cabinet within 6 months of the effective date of the Pledge Law (the “Executive Regulations”). The most significant development under the Pledge Law is that it is no longer necessary for a lender to take possession of movable assets in order to perfect a pledge over the same. This means that a lender is no longer required to appoint an employee/representative of the pledger, as its agent, in order to take possession of any pledged movable assets.

Certain Key Features

In comparison to the previously unregistered pledges, which simply created a contractual right that needed to be enforced by the UAE civil courts, the Pledge Law allows a pledgor to perfect its legal rights over the movable assets through registration.

Once registered, the pledge gives the pledgor priority over third parties and the registration is deemed notice to third parties.

A broad category of pledge assets that can be registered, including bank accounts, tangible and intangible assets, fungible assets, raw material and future assets.

It is not possible to register a pledge over certain types of movable assets including (i) assets relating to home or personal use, (ii) receivables under an insurance policy, (iii) public, foreign consulates or endowment properties, (iv) rights resulting from future inheritance, and (v) assets which require possession or specific registration, in order to perfect a pledge over the same.

The public will have access to information regarding a registered pledge. However, details regarding the information that will be made available to the public and the procedure for requesting the same will be outlined in the Executive Resolutions.

A lender may secure a pledge over tangible and intangible assets of a commercial business, as security for any acquisition funding provided to acquire such commercial business. Such pledge will have priority over the rights of any purchaser, lessee or lien holder, provided that the pledge is registered before the creation of any other rights on the relevant assets. It is not clear to what extent this would replace the current use of commercial mortgages, which also secures an interest over tangible and intangible assets.

If the pledgor or obligor (as applicable) fails to perform its obligations under the pledge contract the pledgee may seek to sell the pledged asset, pursuant to the mutual agreement of the parties or through a summary judgement from the UAE courts.

Application of the Pledge Law

The Pledge Law applies to all civil and commercial transactions that create a right of pledge over movable assets in accordance with the provisions of the Pledge Law. The Pledge Law includes a broad category of pledge assets that can be registered, including bank accounts, commercial paper, tangible and intangible assets (previously intangible assets could only be pledged under a commercial mortgage for LLCs and would require a UAE licensed bank to act as the mortgagee), raw material and fungible assets and future assets (which was not previously possible as this would create a floating charge, which was not recognised under UAE law).

However, the Pledge Law does not apply to movable assets that can only be pledged by possession or where UAE laws require an interest over such assets to be registered under a specific register (e.g. vessels, cars, planes and shares of an LLC). Furthermore, it is not possible to register a pledge over certain categories of assets including (i) assets relating to home or personal use, unless they have been pledged as security for financing the purchase of the same, (ii) proceeds under an insurance policy, unless such proceeds relate to a pledged asset (iii) public, foreign consulates or endowment properties, (iv) rights resulting from future inheritance and (v) assets which require possession or specific registration, in order to perfect a pledge over the same.

How to Create a Right of Pledge

In order to register a pledge, the parties must (i) conclude a pledge contract, including details of the pledged asset, declaration from the pledgor confirming his right to pledge the pledged asset and the nature of the secured debt and (ii) notify the holder of the pledged asset (if not held by the pledgor). The pledge shall be registered by filing the necessary registration form with the registrar. All persons that should be notified of the pledge registration under the provisions of the Pledge Law (e.g. third party holders of the pledged asset), must be notified of the pledge registration at the time of the application. The pledge registrar and registration fees / charges (which will be paid by the pledgor, unless agreed otherwise by the parties) will be specified in the Executive Resolutions.

Once the pledge is registered the legal rights of the pledgee shall be effective against third parties. The pledgee shall be entitled to track and inspect the pledged asset (even if it is held by a third party), have priority over any income generated from the pledged asset and benefit from other priorities that are specific to certain types of pledged assets. For example, any registered pledge over a movable asset that is attached to real property shall have priority over any pledges relating to the real property, provided that the pledged movable asset can be removed without damaging the real property. The pledge rights over the movable asset attached to real property must also be registered in the relevant real estate register.

Enforcement

If the pledgor fails to perform its obligations under the pledge contract then the pledgee may (following prior written notice to the pledgor or obligor (as applicable)) request the sale of the pledged asset at market value within 10 working days, provided that certain conditions are met including (i) the parties agreeing to proceed with the sale without resorting to the courts, (ii) there are no outstanding third party rights over the pledged asset, (iii) notice of the enforcement to the person holding the pledge asset and owner of the real property (in the event that the pledged asset is connected to real property). In the case of pledged accounts the sums in the pledge account may be set-off by the account bank against sums owed to the pledgee (in the case that the pledgee is also the account bank) or the amount in the pledged account can be claimed from the account bank.

Alternatively, the pledgee may apply to the UAE courts for a summary judgement to exercise his rights over the pledged asset. This may involve placing the pledged asset into the hands of a third party in order to affect the sale of the pledged asset. The summary proceedings judge shall notify all relevant parties of the application, who may lodge an objection to the court. If the court permits the summary judgement application it shall permit the pledgee to either (i) take possession of the pledged asset and sell the same at market value or (ii) attach additional conditions for the sale of the pledged asset. The pledgee must register the decision of the court in the pledge register before selling the pledged asset. The pledgee must deposit the sale proceeds, from the sale of the pledged asset, into the treasury of the court, in accordance with the sale procedure set out under the Executive Resolutions.

The sale proceeds shall be distributed in accordance with the directions of the court, taking into account the rights of any other parties over the pledged asset. However, generally the sale proceeds shall be distributed in the following order of priority:

(a) any expenses relating to repairing, the sale, licensing or maintenance of the pledged asset;

(b) charges and fees relating to the enforcement of the pledge, including judicial fees;

(d) any surplus to be distributed in accordance with the laws of the relevant emirate.

Any remainder of the purchase price shall be distributed to the pledgor. If the sale proceeds are insufficient to discharge the debt secured by the pledge, the pledgor shall remain liable for the remaining unpaid debt. Enforcement and sale of the pledged asset will not be possible if the pledgor is subject to any preventative composition, bankruptcy or equivalent procedures under the Federal Decree Law No. 9 of 2016.

Termination of Pledge

A registered pledge may be terminated if (i) the pledgee and pledgor or obligor (as applicable) agree to strike-off the registration, (ii) the obligor discharges the obligations that are secured by the registered pledge, (iii) the registration relates to assets that cannot be pledged under the Pledge Law, (iv) the pledgee fails to discharge its obligations following the registration of the pledge contract, or (v) a court order is issued to strike-off the pledge registration.