UCC Filings - Location of Foreign Debtor under Revised Article 9.

Under Revised Article 9 of the Uniform Commercial Code, a creditor/secured party is able to record a security interest against a foreign entity (non-US) within the US, when the jurisdiction of the debtor’s place of business (if only one place) or chief executive office (if more than one place) does not have a comparable security interest recording system. § 9-307(a)-(c).

When the foreign jurisdiction does not have such a recording system and the debtor has a place of business/chief executive office in the United States, the location of the debtor, and the location of the recording, is the place of business/chief executive office. Where no US place of business/chief executive office exists, the location of the debtor is the District of Columbia. § 9-307(c). When the debtor is registered in a State within the US, that state is the debtor’s location. § 9-307(e).

Thus, when a debtor organized under the laws of the United Kingdom, for example, has a place of business in New York, a UCC financing statement would be filed in New York. However, to protect the creditor/secured party, a filing should also be made in D.C., just in case the debtor moves its chief executive office to a jurisdiction that did not have a comparable security interest recording system. See UCC § 9-307. If the debtor is located in France, which clearly does not have a comparable system and does not have an office in the US, the filing would be made in DC.

Most international jurisdictions which are based on civil law as opposed to English common law do not have systems comparable to the UCC. The majority of these systems are possessory and pledge-based in nature and information regarding these interests are not generally available.

These filings in the District of Columbia can be considered somewhat analogous to “Slavenburg” filings in the UK. The UK system of registration of charges against UK-registered companies would normally reject filings against companies not registered in the UK. The Slavenburg case held that filings made against a company which had not registered in the UK but which was doing business and should have registered should not be rejected.



Section 9--307. Location of Debtor.

(a) "Place of business." In this section, "place of business" means a

place where a debtor conducts its affairs.

(b) Debtor`s location: general rules. Except as otherwise provided in

this section, the following rules determine a debtor`s location:

(1) A debtor who is an individual is located at the individual`s

principal residence.

(2) A debtor that is an organization and has only one place of

business is located at its place of business.

(3) A debtor that is an organization and has more than one place

of business is located at its chief executive office.

(c) Limitation of applicability of subsection (b). Subsection (b)

applies only if a debtor`s residence, place of business, or chief

executive office, as applicable, is located in a jurisdiction whose law

generally requires information concerning the existence of a

nonpossessory security interest to be made generally available in a

filing, recording, or registration system as a condition or result of

the security interest`s obtaining priority over the rights of a lien

creditor with respect to the collateral. If subsection (b) does not

apply, the debtor is located in the District of Columbia.

(d) Continuation of location: cessation of existence, etc. A person

that ceases to exist, have a residence, or have a place of business

continues to be located in the jurisdiction specified by subsections

(b) and (c).

(e) Location of registered organization organized under state law. A

registered organization that is organized under the law of a state is

located in that state.

(f) Location of registered organization organized under federal law;

bank branches and agencies. Except as otherwise provided in subsection

(i), a registered organization that is organized under the law of the

United States and a branch or agency of a bank that is not organized

under the law of the United States or a state are located:

(1) in the state that the law of the United States designates, if

the law designates a state of location;

(2) in the state that the registered organization, branch, or

agency designates, if the law of the United States authorizes

the registered organization, branch, or agency to designate

its state of location; or

(3) in the District of Columbia, if neither paragraph (1) nor

paragraph (2) applies.

(g) Continuation of location: change in status of registered

organization. A registered organization continues to be located in the

jurisdiction specified by subsection (e) or (f) notwithstanding:

(1) the suspension, revocation, forfeiture, or lapse of the

registered organization`s status as such in its jurisdiction

of organization; or

(2) the dissolution, winding up, or cancellation of the existence

of the registered organization.

(h) Location of United States. The United States is located in the

District of Columbia.

(i) Location of foreign bank branch or agency if licensed in only one

state. A branch or agency of a bank that is not organized under the law

of the United States or a state is located in the state in which the

branch or agency is licensed, if all branches and agencies of the bank

are licensed in only one state.

(j) Location of foreign air carrier. A foreign air carrier under the

Federal Aviation Act of 1958, as amended, is located at the designated

office of the agent upon which service of process may be made on behalf

of the carrier.

(k) Section applies only to this part. This section applies only for

purposes of this part.