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 issuer's jurisdiction governs various aspects of securities, while the law of South Dakota governs matters related to securities intermediaries. The bill removes previous provisions that defined the jurisdiction of securities intermediaries and instead establishes that the local law of South Dakota will apply, even if the transaction does not relate to the jurisdiction. Additionally, it amends Section 57A-8-503 to emphasize that interests held by a securities intermediary are for the entitlement holders and not subject to the intermediary's creditors, except under specific conditions.

Further amendments include changes to Section 57A-8-511, which now prioritizes the claims of entitlement holders over creditors when a securities intermediary lacks sufficient interests in a financial asset. The bill also updates Section 57A-9-305 to clarify the governing laws for perfection and priority of security interests in both certificated and uncertificated securities, as well as security entitlements. Overall, the bill aims to streamline and clarify the legal framework surrounding securities and their governance in South Dakota, ensuring that local laws are applied consistently.

Statutes affected:
Introduced, 02/02/2026: 57A-8-110, 57A-8-503, 57A-8-511, 57A-9-305