8.8A-110 - A-110. Applicability; choice of law.
§ 8.8A-110. Applicability; choice of law.
(a) The local law of the issuer's jurisdiction, as specified in subsection(d), governs:
(1) the validity of a security;
(2) the rights and duties of the issuer with respect to registration oftransfer;
(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 whomtransfer of a certificated or uncertificated security is registered or aperson who obtains control of an uncertificated security.
(b) The local law of the securities intermediary's jurisdiction, as specifiedin subsection (e), governs:
(1) acquisition of a security entitlement from the securities intermediary;
(2) the rights and duties of the securities intermediary and entitlementholder arising out of a security entitlement;
(3) whether the securities intermediary owes any duties to an adverseclaimant to a security entitlement; and
(4) whether an adverse claim can be asserted against a person who acquires asecurity entitlement from the securities intermediary or a person whopurchases a security entitlement or interest therein from an entitlementholder.
(c) The local law of the jurisdiction in which a security certificate islocated at the time of delivery governs whether an adverse claim can beasserted against a person to whom the security certificate is delivered.
(d) "Issuer's jurisdiction" means the jurisdiction under which the issuerof the security is organized or, if permitted by the law of thatjurisdiction, the law of another jurisdiction specified by the issuer. Anissuer organized under the law of this state may specify the law of anotherjurisdiction as the law governing the matters specified in subsection (a) (2)through (5).
(e) The following rules determine a "securities intermediary'sjurisdiction" for purposes of this section:
(1) If an agreement between the securities intermediary and its entitlementholder governing the securities account expressly provides that a particularjurisdiction is the securities intermediary's jurisdiction for purposes ofthis part, this title or the Uniform Commercial Code, that jurisdiction isthe securities intermediary's jurisdiction.
(2) If paragraph (1) does not apply and an agreement between the securitiesintermediary and its entitlement holder governing the securities accountexpressly provides that the agreement is governed by the law of a particularjurisdiction, that jurisdiction is the securities intermediary's jurisdiction.
(3) If neither paragraph (1) nor paragraph (2) applies and an agreementbetween the securities intermediary and its entitlement holder governing thesecurities account expressly provides that the securities account ismaintained at an office in a particular jurisdiction, that jurisdiction isthe securities intermediary's jurisdiction.
(4) If none of the preceding paragraphs applies, the securitiesintermediary's jurisdiction is the jurisdiction in which the officeidentified in an account statement as the office serving the entitlementholder's account is located.
(5) If none of the preceding paragraphs applies the securities intermediary'sjurisdiction is the jurisdiction in which the chief executive office of thesecurities intermediary is located.
(f) A securities intermediary's jurisdiction is not determined by thephysical location of certificates representing financial assets, or by thejurisdiction in which is organized the issuer of the financial asset withrespect to which an entitlement holder has a security entitlement, or by thelocation of facilities for data processing or other record keeping concerningthe account.
(1996, c. 216; 2000, c. 1007.)