Perfection by Control

1. Law
2. Georgia Code
3. Commercial Code
4. Secured Transactions
5. Perfection and Priority
6. Perfection by Control

1. Perfection by control. A security interest in investment property, deposit accounts, letter of credit rights, electronic chattel paper, or electronic documents may be perfected by control of the collateral under Code Section 11-7-106, 11-9-104, 11-9-105, 11-9-106, or 11-9-107.
2. Specified collateral; time of perfection by control; continuation of perfection. A security interest in deposit accounts, electronic chattel paper, letter of credit rights, or electronic documents is perfected by control under Code Section 11-7-106, 11-9-104, 11-9-105, or 11-9-107 when the secured party obtains control and remains perfected by control only while the secured party retains control.
3. Investment property; time of perfection by control; continuation of perfection. A security interest in investment property is perfected by control under Code Section 11-9-106 from the time the secured party obtains control and remains perfected by control until:
   1. The secured party does not have control; and
   2. One of the following occurs:
      1. If the collateral is a certificated security, the debtor has or acquires possession of the security certificate;
      2. If the collateral is an uncertificated security, the issuer has registered or registers the debtor as the registered owner; or
      3. If the collateral is a security entitlement, the debtor is or becomes the entitlement holder.

(Code 1981, §11-9-314, enacted by Ga. L. 2001, p. 362, § 1; Ga. L. 2010, p. 481, § 2-27/HB 451.)

The 2010 amendment, effective May 27, 2010, in subsection (a), substituted "electronic chattel paper, or electronic documents" for "or electronic chattel paper" and inserted "11-7-106,"; and, in subsection (b), substituted "letter of credit rights, or electronic documents" for "or letter of credit rights" near the beginning and inserted "11-7-106". See the Editor's notes for applicability.

Editor's notes.

- Ga. L. 2010, p. 481, § 3-1, not codified by the General Assembly, provides that: "This Act applies to a document of title that is issued or a bailment that arises on or after the effective date of this Act. This Act does not apply to a document of title that is issued or a bailment that arises before the effective date of this Act even if the document of title or bailment would be subject to this Act if the document of title had been issued or bailment had arisen on or after the effective date of this Act. This Act does not apply to a right of action that has accrued before the effective date of this Act." This Act became effective May 27, 2010.

Ga. L. 2010, p. 481, § 3-2, not codified by the General Assembly, provides that: "A document of title issued or a bailment that arises before the effective date of this Act and the rights, documents, and interests flowing from that document or bailment are governed by any statute or other rule amended or repealed by this Act as if such amendment or repeal had not occurred and may be terminated, completed, consummated, or enforced under that statute or other rule." This Act became effective May 27, 2010.

RESEARCH REFERENCES

U.L.A.

- Uniform Commercial Code (U.L.A.) § 9-314.

ALR.

- Perfection of security interests by possession, delivery, or control under revised Article 9 of Uniform Commercial Code, 53 A.L.R.6th 159.

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