An order security is a document with the help of which its holder as a subject is legitimized with the expression of rights in it at the end of a continuous series of endorsements made on the presented paper.
The basis of the above definition is some way of legitimizing the holder who has this paper, for the activation of which one actual presentation of this document is not enough. A continuous chain of all endorsements indicated on paper is required
, the last of which is indicated on the presenter.
An order
security is rich in its diversity in terms of legal properties. Their classification is based on various criteria.
First of all, an order security may have a name depending on the kind of obligation certified by it. So, any monetary obligation can be certified by check, bill, bond and various certificates. But corporate obligations are certified using stocks, which are corporate paper. Another type of documents, commodity, helps to certify the rights to services and goods. These may include a bill of lading, a mortgage, and a warehouse certificate.
Another variety of these documents is a check. This is a security, which is a written request from the drawer to the bank to pay the check recipient a certain amount of money indicated in it.
Based on the method of issue, distinguished between emission and non-emission paper. Moreover, the first type includes documents that are mass-produced for the purpose of circulation in the organized market. These may include bonds, stocks and the like. The issue and subsequent circulation of these documents is regulated by the relevant law (Law on the Securities Market). But non-issue issues are issued only if necessary and confirm a certain amount of rights.
Based on the issuer, the order security is either state, or municipal, or private. Their main difference is the type of property with which they are provided.
Registered securities must certify the ownership of the rights specified therein to the person directly named in such paper. The performance of the debtor by it is carried out to this person. The rights certified by this document may be transferred by the owner to other entities. However, this procedure is carried out only in the order that is established for the assignment (assignment of claims), which significantly reduces the turnover of this type of document in comparison with bearer documents.
A registered security is issued in the form of a stock, check, bond, bill of lading and certificate. Rights on this type of documents are transferred or assigned by making a special entry in the register on the personal account or on the basis of the requirements of an authorized entity. Rights on some registered securities are not transferred at all. An example is a personalized check.