The Bill aims to change the law in relation to two areas of moveable property:
This is a Government bill
The Bill became an Act on 13 June 2023
This Bill was passed and is now an Act of the Scottish Parliament.
“Moveable” property means property which can be physically moved (for example, cars, machinery and whisky barrels). It can, however, also mean intellectual property like patents and copyrights.
The Bill reforms two elements of the law on moveable property:
“Assignation” of claims is the transfer of a claim from one person to another. A claim is most commonly the right to payment of a debt. For example, if someone has a right to be paid for goods or services, they can transfer that right to payment to another person.
A “pledge” is a type of security (usually for a loan) which is taken over moveable property. This works in a similar way to a mortgage on a house. In that case someone grants a loan but the lender has a security over the house in case the loan is not repaid. With a pledge, someone grants a loan and the lender has a security over a piece of moveable property in case the loan is not repaid.
Under the current law, an assignation can only be completed by letting the person who owes the debt know about the assignation (“intimation”). A pledge can only be granted under the current law by delivering the property that has been pledged to the person granting the loan.
The Bill changes this by creating two new registers:
The registers can be used to grant assignations of claims (as an alternative to intimating the assignation to the debtor) or statutory pledges over moveable property. The Bill still allows intimation of an assignation of a claim. It will also still be possible to grant a pledge by delivery instead of registration (most commonly by a process referred to as “pawn”).
The Bill is based on a Scottish Law Commission (“SLC”) report and in particular the draft Bill prepared by the SLC (see volume 3).
The Bill aims to modernise the law in the areas described in the overview.
The law at the moment is mostly non-statutory. This means the law is reliant on the precedent set in the outcomes of previous legal disputes, rather than legislation. The legislation that does exist is very old. The current law is considered outdated and too restrictive for the way businesses work in modern Scotland.
The Bill will allow businesses to raise finance by assigning (that is, selling,) claims that they will have a right to, so that they get money from the person to whom the claim is assigned faster than would be the case if they waited until the claim was paid by the debtor.
For example, if a business does a lot of work in May that clients will pay for in June, that business still needs enough money in May to pay its expenses. The changes introduced in the Bill would allow the business to get money in May by assigning its claim for the money its customers owe in June, for example, to a bank.
If the business needs £1,000 to pay its expenses in May, a bank could lend the business that money in May. In return, the business would give the bank its right to be paid by its customers (who owe £1,000) in June. In June, the customers pay the bank instead of the business.
This will help businesses with cash-flow problems get money when they need it on the strength of money owed to them.
The Bill aims to offer more flexibility to raise finance.
For example, a business may need to borrow money and want to grant a pledge over its machinery to secure that loan. Under the previous law, this could only be done by delivering that machinery to the person granting the loan. That does not work for many businesses who require the use of that machinery to keep operating.
The Bill allows the pledge to be granted without delivering the machinery. Instead the pledge is recorded in the new register. This means the business could keep operating the machinery as it needs to, but the person granting the loan still has a security over the machinery in case the business does not repay that loan.
Moveable Transactions (Scotland) Bill as Introduced (3MB, pdf) posted 25 May 2022
Explanatory Notes (534KB, pdf) posted 25 May 2022
Policy Memorandum (492KB, pdf) posted 25 May 2022
Financial Memorandum (254KB, pdf) posted 25 May 2022
Delegated Powers Memorandum (273KB, pdf) posted 25 May 2022
Statements on legislative competence (109KB, pdf) posted 25 May 2022
Explanatory Notes (583KB, pdf) posted 25 May 2022
Policy Memorandum (510KB, pdf) posted 25 May 2022
Financial Memorandum (330KB, pdf) posted 25 May 2022
Delegated Powers Memorandum (306KB, pdf) posted 25 May 2022
Statements on legislative competence (159KB, pdf) posted 25 May 2022
All Bills introduced in the Parliament must be accompanied by specific documents. For most Bills, this includes:
Explanatory Notes: this document provides an overview of what the Bill does, plus a more detailed explanation of individual provisions.
Policy Memorandum: this sets out the objectives of the Bill. It also lists any alternatives considered, details of consultations, and an assessment of the effects of the Bill on a range of areas.
Financial Memorandum: this sets out estimates of costs, savings, and any changes to revenues expected to result from the Bill.
Delegated Powers Memorandum: this is needed if a Bill gives powers to make subordinate legislation or allows Scottish Ministers to issue directions, guidance or codes of practice.
Statements on legislative competence: two short statements, one by the Presiding Officer and one by the Member introducing the Bill. “Legislative competence” means the powers the Parliament has to make law.
The Presiding Officer has decided under Rule 9.12 of Standing Orders that a financial resolution is required for this Bill.
For each Bill, the Presiding Officer must decide if a 'Financial Resolution' is required. The main reasons a Bill would need a Financial Resolution are that:
If a Bill requires a Financial Resolution:
The Scottish Parliament's Information Centre (SPICe) prepares impartial research and analysis to assist MSPs in their examination of Bills and other parliamentary business.
Research briefing on the Moveable Transactions (Scotland) Bill
The Bill was introduced on 25 May 2022
At Stage 1, the Bill is given to a lead committee. This is usually the committee whose remit most closely relates to the subject of the Bill. The lead committee will consider and report on the Bill. Other committees may also examine the Bill and report to the lead committee. Finally, there is a debate and vote by all MSPs on the general principles of the Bill. If the general principles are not agreed to, then the Bill ‘falls’ and can’t become law.
Parliament agreed that consideration of the Moveable Transactions (Scotland) Bill at stage 1 be completed by 16 December 2022.
The lead committee for this Bill is the Delegated Powers and Law Reform Committee.
The lead committee will usually examine the Bill through evidence sessions. This will involve contributions from individuals and organisations, known as 'witnesses', with knowledge of the subject matter. The committee might also discuss the Bill in private sessions.
The call for views closed on 6 September 2022.
Letter from the Minister for Public Finance, Planning and Community Wealth to the Convener, 13 March 2023
Letter from the Parliamentary Under Secretary of State for Scotland to the Convener, 13 March 2023
Letter from the Convener to the Parliamentary Under Secretary of State for Scotland, 8 March 2023
Letter from the Convener to the Minister for Public Finance, Planning and Community Wealth, 8 March 2023
Letter from the Minister for Public Finance, Planning and Community Wealth to the Convener, 3 March 2023
See a full list of Stage 1 correspondence for this committee
The lead committee published a report on 27 October 2022.
Delegated Powers Provisions in the Moveable Transactions (Scotland) Bill at Stage 1
The lead committee published its Stage 1 Report on 2 December 2022.
Stage 1 Report on the Moveable Transactions (Scotland) Bill
The committee received the follow response to its Stage 1 Report:
Letter from the Minister for Public Finance, Planning and Community Wealth (149KB, pdf) posted 12 December 2022
If a Bill is relevant to more than one committee, 'secondary committees' may consider and report on the general principles of the Bill to the lead committee. Some Bills may also be considered by the Delegated Powers and Law Reform Committee or the Finance and Public Administration Committee.
See further details of the motion
The Bill ended Stage 1 on 13 December 2022
At Stage 2, MSPs can propose changes to a Bill. These are called 'amendments'. Any MSP can suggest amendments but only members of the Stage 2 committee can decide on them.
On 8 March 2023, Parliament agreed motion S6M-08152, that consideration of the Moveable Transactions (Scotland) Bill at Stage 2 be completed by 24 March 2023.
Documents with the amendments considered at the meeting held on 21 March 2023.
Marshalled list of amendments for Stage 2 (379KB, pdf) posted 16 March 2023
Groupings of amendments for Stage 2 (363KB, pdf) posted 16 March 2023
A Stage 2 'Marshalled List' is a list of all the amendments that have been lodged at Stage 2 (or, if the Stage is mid-way through, all those still to be dealt with). They are listed in the order in which they will be called by the convener and then decided on.
A 'Groupings' list shows how the amendments that are listed in the Marshalled List have been grouped together for debate. Each group contains amendments that are related to each other, even if they are at different places in the Marshalled List.
Moveable Transactions (Scotland) Bill as amended at Stage 2 (4MB, pdf) posted 21 March 2023
Revised Explanatory Notes (579KB, pdf) posted 20 April 2023
Supplementary Financial Memorandum (204KB, pdf) posted 19 April 2023
Supplementary Delegated Powers Memorandum (154KB, pdf) posted 18 April 2023
Revised Explanatory Notes (624KB, pdf) posted 19 April 2023
Supplementary Financial Memorandum (218KB, pdf) posted 18 April 2023
Supplementary Delegated Powers Memorandum (240KB, pdf) posted 18 April 2023
Sometimes an amendment at Stage 2 makes substantial changes to a bill. If this happens, the Accompanying Documents need to be updated to explain what these changes are.
The Bill ended Stage 2 on 21 March 2023
At Stage 3, MSPs can propose further amendments (changes) to the Bill. These are debated and decided on in the Debating Chamber. At this stage, all MSPs can vote on them. There is then a debate on whether to pass the Bill. If the Bill is not passed, it ‘falls’ and can't become law.
Research briefing on the Moveable Transactions (Scotland) Bill prior to Stage 3
Documents with the amendments considered at the meeting held on 4 May 2023:
Marshalled List of Amendments for Stage 3 (230KB, pdf) posted 27 April 2023
Groupings of Amendments for Stage 3 (268KB, pdf) posted 27 April 2023
A Stage 3 'Marshalled List' is a list of all the amendments that have been proposed at Stage 3 and that have been selected by the Presiding Officer. They are listed in the order in which they will be called by the Presiding Officer and then decided on.
A 'Groupings' list shows how the amendments that are listed in the Marshalled List have been grouped together for debate. Each group contains amendments that are related to each other, even if they are at different places in the Marshalled List.
‘Timed Groupings’ are usually produced at Stage 3 and set out how long Parliament expects to spend debating the groups of amendments.
Moveable Transactions (Scotland) Bill as passed (4MB, pdf) posted 04 May 2023
Result 111 for, 0 against, 0 abstained, 18 did not vote Vote Passed
See further details of the motion
The Bill ended Stage 3 on 4 May 2023
The Bill was passed on 4 May 2023 and became an Act on 13 June 2023.