KRS 355.12-107: Governing law.

(1) Except as provided in subsection (2) of this section, the local law of a controllable

electronic record's jurisdiction governs the matters covered by this article.

(2) For a controllable electronic record that evidences a controllable account or

controllable payment intangible, the local law of the controllable electronic record's

jurisdiction governs a matter covered by KRS 355.12 -106 unless an effective

agreement determines that the local law of another jurisdiction governs.

(3) The following rules determ ine a controllable electronic record's jurisdiction under

this section:

(a) If the controllable electronic record, or a record attached to or logically

associated with the controllable electronic record and readily available for

review, expressly provides that a particular jurisdiction is the controllable

electronic record's jurisdiction for purposes of this article or chapter, that

jurisdiction is the controllable electronic record's jurisdiction;

(b) If paragraph (a) of this subsection does not apply and the rules of the system

in which the controllable electronic record is recorded are readily available for

review and expressly provide that a particular jurisdiction is the controllable

electronic record's jurisdiction for purposes of this article or this chapter, that

jurisdiction is the controllable electronic record's jurisdiction;

(c) If paragraphs (a) and (b) of this subsection do not apply and the controllable

electronic record, or a record attached to or logically associated with the

controllable ele ctronic record and readily available for review, expressly

provides that the controllable electronic record is governed by the law of a

particular jurisdiction, that jurisdiction is the controllable electronic record's

jurisdiction;

(d) If paragraphs (a), (b), and (c) of this subsection do not apply and the rules of

the system in which the controllable electronic record is recorded are readily

available for review and expressly provide that the controllable electronic

record or the system is governed by the law of a particular jurisdiction, that

jurisdiction is the controllable electronic record's jurisdiction; and

(e) If paragraphs (a) to (d) of this subsection do not apply, the controllable

electronic record's jurisdiction is the District of Columbia.

(4) (a) If subsection (3)(e) of this section applies and Article 12 is not in effect in the

District of Columbia without material modification, the governing law for a

matter covered by this article is the law of the District of Columbia as though

Article 12 w ere in effect in the District of Columbia without material

modification.

(b) In this subsection, "Article 12" means Article 12 of the Uniform Commercial

Code Amendments (2022).

(5) To the extent subsections (1) and (2) of this section provide that the local law of the

controllable electronic record's jurisdiction governs a matter c overed by this article,

that law governs even if the matter or a transaction to which the matter relates does

not bear any relation to the controllable electronic record's jurisdiction.

(6) The rights acquired under KRS 355.12 -104 by a purchaser or qualify ing purchaser

are governed by the law applicable under this section at the time of purchase.