They merely distributed the money to enterprises and collected the profits. Recognizing the shortcomings of central planning based almost exclusively on public ownership over the means of production, China embarked on an economic reform program in 1978. In 1993, China boldly declared that it would move towards a market oriented economy. Security devices have played significant roles in China s reform towards a market oriented economy. Within a period of twenty years, China has developed a sophisticated understanding of the many security devices adopted in the West.
Secured transactions are now very popular.
The central focus of this article is to examine the various security devices under Chinese law and practice. These security devices include the deposit, the lien, the dian , the mortgage, the pledge, and the guarantee. The strengths and weaknesses of the legal provisions governing these security devices are also discussed.