Modifies provisions relating to the Uniform Commercial Code

Summary

The bill rewrites parts of the Uniform Commercial Code so that the law of the issuer’s state and the law of a securities intermediary’s jurisdiction determine the validity of securities, the rights and duties of issuers and intermediaries, and how adverse claims are handled. It also clarifies that securities held by intermediaries belong to entitlement holders, not the intermediary, and gives those holders priority over most creditor claims. The measure failed to pass after a second reading and referral to the Senate Insurance and Banking Committee.

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