§ 4-8-110 — Applicability - choice of law

(a) The local law of the issuer's
jurisdiction, as specified in subsection (d) of this section, governs:

(1) The validity of a security;

(2) The rights and duties of the issuer with respect to registration of transfer;

(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 whom
transfer of a certificated or uncertificated security is registered or a person who
obtains control of an uncertificated security.

(b) The local law of the securities intermediary's jurisdiction, as specified in
subsection (e) of this section, governs:

(1) Acquisition of a security entitlement from the securities intermediary;

(2) The rights and duties of the securities intermediary and entitlement
holder arising out of a security entitlement;

(3) Whether the securities intermediary owes any duties to an adverse
claimant to a security entitlement; and

(4) Whether an adverse claim can be asserted against a person who acquires
a security entitlement from the securities intermediary or a person who purchases a
security entitlement or interest therein from an entitlement holder.

(c) The local law of the jurisdiction in which a security certificate is located
at the time of delivery governs whether an adverse claim can be asserted against a
person to whom the security certificate is delivered.

(d) Issuer's jurisdiction means the jurisdiction under which the issuer of the
security is organized or, if permitted by the law of that jurisdiction, the law of
another jurisdiction specified by the issuer. An issuer organized under the law of
this state may specify the law of another jurisdiction as the law governing the
matters specified in subsection (a)(2) through (a)(5) of this section.

(e) The following rules determine a securities intermediary's jurisdiction for
purposes of this section:

(1) If an agreement between the securities intermediary and its entitlement
holder governing the securities account expressly provides that a particular
jurisdiction is the securities intermediary's jurisdiction for purposes of this part 1,
this article, or this title, that jurisdiction is the securities intermediary's jurisdiction.

(2) If paragraph (1) of this subsection (e) does not apply and an agreement
between the securities intermediary and its entitlement holder governing the
securities account expressly provides that the agreement is governed by the law of
a particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.

(3) If neither paragraph (1) nor paragraph (2) of this subsection (e) applies
and an agreement between the securities intermediary and its entitlement holder
expressly provides that the securities account is maintained at an office in a
particular jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.

(4) If none of paragraphs (1), (2), or (3) of this subsection (e) applies, the
securities intermediary's jurisdiction is the jurisdiction in which the office identified
in an account statement as the office serving the entitlement holder's account is
located.

(5) If none of paragraphs (1), (2), (3), or (4) of this subsection (e) applies, the
securities intermediary's jurisdiction is the jurisdiction in which the chief executive
office of the securities intermediary is located.

(f) A securities intermediary's jurisdiction is not determined by the physical
location of certificates representing financial assets, or by the jurisdiction in which
is organized the issuer of the financial asset with respect to which an entitlement
holder has a security entitlement, or by the location of facilities for data processing
or other record keeping concerning the account.

(g) The local law of the issuer's jurisdiction or the securities intermediary's
jurisdiction governs a matter or transaction specified in subsection (a) or (b) of this
section even if the matter or transaction does not bear any relation to the
jurisdiction.

Legislative History

Source: L. 96: Entire article R&RE, p. 212, � 2, effective July 1. L. 2001: (e) R&RE, p. 1442, � 32, effective July 1. L. 2023: (g) added, (SB 23-090), ch. 136, p. 539, � 40, effective August 7.