N.Y. Uniform Commercial Code Law § 9-105: Control of Electronic Copy of Record Evidencing Chattel Paper

Section 9--105. Control of Electronic Copy of Record Evidencing Chattel

Paper.

(a) General rule: control of electronic copy of record evidencing

chattel paper. A purchaser has control of an authoritative electronic

copy of a record evidencing chattel paper if a system employed for

evidencing the assignment of interests in the chattel paper reliably

establishes the purchaser as the person to which the authoritative

electronic copy was assigned.

(b) Single authoritative copy. A system satisfies subsection (a) if

the record or records evidencing the chattel paper are created, stored,

and assigned in a manner that:

(1) a single authoritative copy of the record or records exists

which is unique, identifiable and, except as otherwise

provided in paragraphs (4), (5), and (6), unalterable;

(2) the authoritative copy identifies the secured party as the

assignee of the record or records;

(3) the authoritative copy is communicated to and maintained by

the secured party or its designated custodian;

(4) copies or revisions that add or change an identified assignee

of the authoritative copy can be made only with the

participation of the secured party;

(5) each copy of the authoritative copy and any copy of a copy is

readily identifiable as a copy that is not the authoritative

copy; and

(6) any revision of the authoritative copy is readily

identifiable as an authorized or unauthorized revision.

(c) One or more authoritative copies. A system satisfies subsection

(a), and a purchaser has control of an authoritative electronic copy of

a record evidencing chattel paper, if the electronic copy, a record

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

system in which the electronic copy is recorded:

(1) enables the purchaser readily to identify each electronic copy as

either an authoritative copy or a nonauthoritative copy;

(2) enables the purchaser readily to identify itself in any way,

including by name, identifying number, cryptographic key, office, or

account number, as the assignee of the authoritative electronic copy;

and

(3) gives the purchaser exclusive power, subject to subsection (d),

to:

(A) prevent others from adding or changing an identified assignee of

the authoritative electronic copy; and

(B) transfer control of the authoritative electronic copy.

(d) Meaning of exclusive. Subject to subsection (e), a power is

exclusive under subsection (c)(3)(A) and (B) even if:

(1) the authoritative electronic copy, a record attached to or

logically associated with the authoritative electronic copy, or a system

in which the authoritative electronic copy is recorded limits the use of

the authoritative electronic copy or has a protocol programmed to cause

a change, including a transfer or loss of control; or

(2) the power is shared with another person.

(e) When power not shared with another person. A power of a purchaser

is not shared with another person under subsection (d)(2) and the

purchaser's power is not exclusive if:

(1) the purchaser can exercise the power only if the power also is

exercised by the other person; and

(2) the other person:

(A) can exercise the power without exercise of the power by the

purchaser; or

(B) is the transferor to the purchaser of an interest in the chattel

paper.

(f) Presumption of exclusivity of certain powers. If a purchaser has

the powers specified in subsection (c)(3)(A) and (B), the powers are

presumed to be exclusive.

(g) Obtaining control through another person. A purchaser has control

of an authoritative electronic copy of a record evidencing chattel paper

if another person, other than the transferor to the purchaser of an

interest in the chattel paper:

(1) has control of the authoritative electronic copy and acknowledges

that it has control on behalf of the purchaser; or

(2) obtains control of the authoritative electronic copy after having

acknowledged that it will obtain control of the electronic copy on

behalf of the purchaser.