Talking Points & Resources | NY Emerging Technologies Amendments to the UCC

The New York Emerging Technology Amendments would modernize, rationalize, and clarify the Uniform Commercial Code (UCC) so that it effectively governs the commercial law aspects of important transactions in digital assets. This page is intended to be a resource to help advocate for the Amendments enactment.

BILL INFORMATION

S.7244-A Sponsored by Senator Brad Hoylman-Sigal

STATUS

  • Senate Third Reading Calendar; favorably reported from the Senate Judiciary Committee (May 14, 2024)
  • Assembly bill number pending

HOW YOU CAN HELP

ACT NOW TO ENCOURAGE PASSAGE BEFORE THE LEGISLATIVE SESSION ENDS ON JUNE 7TH!

  • Add your organization’s name to the list of supporters of the Amendments (see here) by contacting Elizabeth Kocienda at ekocienda@nycbar.org. This list will be posted on the City Bar’s website and provided to legislators as part of related advocacy materials.
  • Have your organization issue a memo or letter in support of the bill. A sample letter can be downloaded for customization here. See below for relevant contact information and talking points for further points to highlight. 
    • Memos/letters should be conveyed to Sen. Brad Hoylman-Sigal and Senate Majority Leader Andrea Stewart-Cousins.
    • A copy should also be sent to Assembly Member Alex Bores, who will be sponsoring the bill in the Assembly and Speaker Carl Heastie, with the message that the Assembly should consider the bill as soon as a same-as bill is introduced.
    • See below for contact information.
  • Share information about your advocacy efforts. Please contact Elizabeth Kocienda at ekocienda@nycbar.org with the below information / materials:
    • A copy of your support memo/letter when it is issued.
    • Updates on your outreach to legislators and/or their staff. This will help us keep track of which legislators are being contacted and how much support the bill has.
    • Your contact information so she can keep you updated on the bill and future opportunities to help support the legislation. Sign up to receive advocacy alerts and updates about the bills by filling out the form at the bottom of this page.

WHO TO CONTACT

Senator Brad Hoylman-Sigal, bill sponsor and Chair of the Senate Judiciary Committee
hoylman@nysenate.gov | 518-455-2451

Senate Majority Leader Andrea Stewart-Cousins
scousins@nysenate.gov | 518-455-2585

Assembly Member Alex Bores, bill sponsor
boresa@nyassembly.gov | 518-455-4794

Assembly Speaker Carl Heastie
Speaker@nyassembly.gov | 518-455-3791

TALKING POINTS

  • What is the Uniform Commercial Code (UCC)?
    • The UCC is a comprehensive set of laws governing all commercial transactions in the US. It is not a federal law, but a uniformly adopted state law.
    • Uniformity of law is essential in this area for the interstate transaction of business.
    • Because the UCC has been universally adopted, businesses can enter into contracts with confidence that the terms will be enforced in the same way by the courts of every US jurisdiction.
    • The resulting certainty of business relationships allows businesses to grow, especially small businesses, and the US economy to thrive.
  • Why update the New York Uniform Commercial Code (NY UCC) now?
    • The NY UCC has not been updated since 2014.
    • New technologies and enhancements to existing technologies since 2014 have had and are expected to continue to have material influences on commerce and finance.
    • The NY UCC, as currently drafted, (1) with respect to the development of digital assets, is wedded to technologies from the end of the last century and does not adequately provide for the use of technology which has emerged in the past decade or which may evolve in the future and (2) does not adequately address the full extent to which commercial and financial transactions may be conducted and administered electronically and free from the constraints of paper documents.
    • New York commercial and financial law has unique respect for freedom of contract and strong protections for the negotiability of commercial instruments, and this has long made New York the preferred US jurisdiction for paper-based commercial and financial transactions. Unfortunately, the same is not yet true for transactions involving digital assets.
  • What are some of the benefits to adopting the Amendments in New York?
    • The Amendments make the updates necessary to preserve New York’s preeminence as a leading commercial jurisdiction and will help to make New York the preferred jurisdiction for transactions involving digital assets and digital products and services.
    • Updating the NY UCC will promote and encourage technological and commercial advances that decrease transactional costs and enhance the efficiency, certainty and security of commercial and financial transactions governed by the NY UCC. Technological and commercial advances that decrease transactional costs and enhance the efficiency, certainty and security of commercial and financial transactions are major factors that are considered when market participants are deciding whether to choose New York as the governing law and the jurisdiction to resolve disputes and whether businesses will decide to locate their businesses in New York.
    • Updating the NY UCC will help ensure New York’s leadership in commercial and financial progress and growth and will prevent migration of digital commerce to other jurisdictions which more clearly promote and encourage technological and commercial advances.
    • Updating the NY UCC will further New York’s long-standing goals of (1) encouraging choice of New York law and jurisdiction to govern commercial contracts and (2) making the advantages of electronic commerce available to the greatest extent in New York.
  • What is the background on the New York Emerging Technologies Amendments to the Uniform Commercial Code?
    • In July 2022, the Uniform Law Commission and American Law Institute approved amendments (Model UCC Amendments) to the UCC which were designed to address the failure of the UCC to accommodate digital assets. The New York Emerging Technologies Amendments are based on the Model UCC Amendments but were crafted specifically for New York. The Amendments are intended to preserve and apply existing New York-specific principles, particularly those protecting the rights of good faith purchasers of negotiable instruments and documents, to transactions involving digital assets which are the electronic equivalent of such instruments and documents.
    • Almost two dozen states and the District of Columbia have already enacted the Model UCC Amendments.
    • Other states, including New York, have introduced bills covering the Model UCC Amendments.

 

Contact: Elizabeth Kocienda, Director of Advocacy, ekocienda@nycbar.org