The bill amends several sections of the Uniform Commercial Code (UCC) in South Dakota, specifically focusing on the governance of securities and security entitlements. Notably, it modifies Section 57A-8-110 to clarify that the law of the state governs the rights and duties of securities intermediaries and entitlement holders, replacing previous references to the securities intermediary's jurisdiction. Additionally, it emphasizes that the local law of the issuer's jurisdiction governs various aspects of securities validity and transfer, while also detailing the priority of claims between entitlement holders and creditors in Section 57A-8-511, asserting that entitlement holders' claims take precedence when the securities intermediary lacks sufficient interests in a financial asset.

Further amendments in Section 57A-9-305 establish that the local law of the state governs the perfection and priority of security interests in securities and security entitlements, again replacing references to the securities intermediary's jurisdiction. The bill aims to streamline the legal framework surrounding securities transactions and clarify the rights of parties involved, ensuring that South Dakota law is consistently applied in these matters. Overall, the changes are intended to enhance the clarity and efficiency of the UCC as it pertains to securities and their management.

Statutes affected:
Introduced, 01/28/2025: 57A-8-110, 57A-8-503, 57A-8-511, 57A-9-305
House Commerce and Energy Engrossed, 02/05/2025: 57A-8-110, 57A-8-503, 57A-8-511, 57A-9-305