Analysis of the Effect of the Liquid Clause in the Civil Code

The Civil Code no longer directly stipulates that the liquid clause is invalid by adopting the legal consequence model for liquid clauses; the softening of the attitude towards the liquid clause is mainly due to the impact of optimising the business environment and the necessity of lifting the ban on the liquid clause. The liquidation of the liquid clause is the realisation procedure of mortgage and pledge in the typical guarantee, and the transfer of the guarantee is represented by the assignment of the guarantee in the case of atypical security, and the realisation of the validity of the liquid clause needs to be based on the principle of attribution liquidation, so as to better realise the value purpose of the liquid clause and ensure the balance of interests between the security right holder and the guarantor.