North Dakota Code 41-09-05 – (9-105) Control of electronic copy of record evidencing chattel paper
1. 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.
Terms Used In North Dakota Code 41-09-05
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Authorized: when used with reference to a financing statement record, means that the financing statement record was filed by a person authorized to do so as provided in sections 41-09-80 and 41-09-130. See North Dakota Code 41-10-01
- paper: means any flexible material upon which it is usual to write. See North Dakota Code 1-01-27
- Person: means an individual, organization, government, political subdivision, or government agency or instrumentality. See North Dakota Code 1-01-49
2. A system satisfies subsection 1 if the record or records evidencing the chattel paper are created, stored, and assigned in such a manner that:
a. A single authoritative copy of the record or records exists which is unique, identifiable, and, except as otherwise provided in subdivisions d, e, and f, unalterable; b. The authoritative copy identifies the purchaser as the assignee of the record or records; c. The authoritative copy is communicated to and maintained by the purchaser or its designated custodian; d. Copies or amendments that add or change an identified assignee of the authoritative copy can be made only with the consent of the purchaser; e. 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
f. Any amendment of the authoritative copy is readily identifiable as authorized or unauthorized.
3. A system satisfies subsection 1, 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:
a. Enables the purchaser readily to identify each electronic copy as either an authoritative copy or a nonauthoritative copy; b. 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
c. Gives the purchaser exclusive power, subject to subsection 4, to:
(1) Prevent others from adding or changing an identified assignee of the authoritative electronic copy; and
(2) Transfer control of the authoritative electronic copy.
4. Subject to subsection 5, a power is exclusive under subdivision c of subsection 3 even if:
a. 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
b. The power is shared with another person.
5. A power of a purchaser is not shared with another person under subdivision b of subsection 4 and the purchaser’s power is not exclusive if:
a. The purchaser can exercise the power only if the power also is exercised by the other person; and b. The other person:
(1) Can exercise the power without exercise of the power by the purchaser; or
(2) Is the transferor to the purchaser of an interest in the chattel paper.
6. If a purchaser has the powers specified in subdivision c of subsection 3, the powers are presumed to be exclusive.
7. 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:
a. Has control of the authoritative electronic copy and acknowledges that it has control on behalf of the purchaser; or
b. Obtains control of the authoritative electronic copy after having acknowledged that it will obtain control of the electronic copy on behalf of the purchaser.