§12A-8-110. Applicability; Choice of Law.
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Applicability; Choice of Law.
(a)The local law of the issuer's jurisdiction, as specified in subsection
(d)of this section, governs:
(1)the validity of a security;
(2)the rights and duties of the issuer with respect to
registration of transfer;
(3)the effectiveness of registration of transfer by the
issuer;
(4)whether the issuer owes any duties to an adverse
claimant to a security; and
(5)whether an adverse claim can be asserted against a
person to whom transfer of a certificated or
uncertificated security is registered or a person who
obtains control of an uncertificated security.
(b)The local law of the securities intermediary's jurisdiction, as specified in subsection
(e)of this section, governs:
(1)acquisition of a security entitlement from the
securities intermediary;
(2)the rights and duties of the securities intermediary
and entitlement holder arising out of a security
entitlement;
(3)whether the securities intermediary owes any duties to
an adverse claimant to a security entitlement; and
(4)whether an adverse claim can be asserted against a
person who acquires a security entitlement from the
securities intermediary or a person who purchases a
security entitlement or interest therein from an
entitlement holder.
(c)The local law of the jurisdiction in which a security certificate is located at the time of delivery governs whether an adverse claim can be asserted against a person to whom the security certificate is delivered.
(d)"Issuer's jurisdiction" means the jurisdiction under which the issuer of the security is organized or, if permitted by the law of that jurisdiction, the law of another jurisdiction specified by the issuer. An issuer organized under the law of this state may specify the law of another jurisdiction as the law governing the matters specified in paragraphs
(2)through
(5)of subsection
(a)of this section.
(e)The following rules determine a "securities intermediary's jurisdiction" for purposes of this section:
(1)If an agreement between the securities intermediary
and its entitlement holder governing the securities
account expressly provides that a particular
jurisdiction is the securities intermediary's
jurisdiction for purposes of this part, this article,
or this title, that jurisdiction is the securities
intermediary's jurisdiction;
(2)If paragraph
(1)does not apply and an agreement
between the securities intermediary and its
entitlement holder governing the securities account
expressly provides that the agreement is governed by
the law of a particular jurisdiction, that
jurisdiction is the securities intermediary's
jurisdiction.
(3)If neither paragraph
(1)nor paragraph
(2)of this
subsection applies and an agreement between the
securities intermediary and its entitlement holder
governing the securities account expressly provides
that the securities account is maintained at an office
in a particular jurisdiction, that jurisdiction is the
securities intermediary's jurisdiction;
(4)If none of the preceding paragraphs of this subsection
applies, the securities intermediary's jurisdiction is
the jurisdiction in which the office identified in an
account statement as the office serving the
entitlement holder's account is located; and
(5)If none of the preceding paragraphs of this subsection
applies, the securities intermediary's jurisdiction is
the jurisdiction in which the chief executive office
of the securities intermediary is located.
(f)A securities intermediary's jurisdiction is not determined by the physical location of certificates representing financial assets, or by the jurisdiction in which is organized the issuer of the financial asset with respect to which an entitlement holder has a security entitlement, or by the location of facilities for data processing or other recordkeeping concerning the account.
(g)The local law of the issuer's jurisdiction or the securities intermediary's jurisdiction governs a matter or transaction specified in subsection
(a)or
(b)of this section even if the matter or transaction does not bear any relation to the jurisdiction. Added by Laws 1995, c. 242, § 10, eff. Feb. 1, 1996. Amended by Laws 2000, c. 371, § 162, eff. July 1, 2001; Laws 2024, c. 13, § 40, eff. Nov. 1, 2024.