Commercial law: secured transactions.

The Uniform Commercial Code governs security interests in collateral, including personal property and fixtures, as well as certain sales of accounts, contract rights, and chattel paper. The code, among other things, specifies requirements and procedures regarding perfecting a security interest, including the filing of a financing statement with the Secretary of State, amending a financing statement, transferring a security interest, and terminating a security interest. The code also governs the effectiveness of a security interest when a debtor changes locations to another jurisdiction. This bill would, on and after July 1, 2014, revise and recast specified provisions governing security interests. Among other things, the revised provisions would (1) define a "public organic record" and revise the definitions of "authenticate," "certificate of title," and "registered organization" for purposes of those provisions, (2) specify an additional requirement for determining whether a secured party has control of electronic chattel paper, (3) specify rules that apply to collateral to which a security interest attaches within 4 months after the debtor changes its location to another jurisdiction, (4) revise the requirements for a record to sufficiently provide the name of a registered organization, a decedent's estate, or an individual, (5) provide for a secured party of record with respect to a financing statement to file an information statement with respect to a record if the secured party believes that the person that filed the record was not entitled to do so, and (6) enact changes relating to the subordination of security interests, the assignment of security interests, and the refusal of a filing office to accept a record for filing. This bill would implement transitional rules for determining the perfection of a security interest, as specified. The bill would also revise cross-references and make conforming changes to related provisions. This bill would become operative on July 1, 2014. This bill would appropriate $240,000 from the Secretary of State's Business Fees Fund to the Secretary of State to implement this bill, including, but not limited to, promulgating appropriate regulations, modifying automated filing systems and programming, and updating filing forms.