Action Plan Amendments to the Security Interests (Jersey) Law 2012 Past meetings TF: Tom Fothergill JR: John Rainer MD: Mark Dunlop PG: Peter German DP: David Postlethwaite Meeting date Agenda Outcome Next steps / actions points 7 November 2017 Article 1 (Definitions) Broad agreement on Article 1, Next meeting to be convened Article 3 (Meaning of control ) but follow up needed on several points Further discussion of Article 3 needed 21 November 2017 Outstanding points on Article 1 (Definitions) Article 3 (Meaning of control ) Article 4 (Application of Law) Article 5 (Parties may agree that Law applies to agreement) Article 6 (Security interests in own obligation) 16 January 2018 Article 4 (Application of Law) Article 5 (Parties may agree that Law applies to agreement) Broad agreement on Article 1, but follow up needed on definition of Money Broad agreement on Article 3, but follow up needed on 3(6) Proposed drafting required for amending Articles 4 and 5 Agreement on Article 6 Articles 4 and 5: PG provided drafting to be considered JR to further consider definition of Money MD to consider wording for Article 3(6) PG to prepare drafting for Articles 4 and 5 Group to review PG s drafting of Articles 4 and 5 JR to re-draft Article 8(1)(b) 1
Article 6(c) (Security interests in own obligation) Article 8 (Interests excluded) Article 9 (Transactions excluded) Article 10 (Subordination agreements) Article 12 (Exclusive application of this Law) Article 15 (Security interest created by agreement) 8 February 2018 Group strategy, progress review Academic involvement in SIL Rationale for the SIL amendments Possible consolidation of SIL 1/2/3 Approach to drafting SIL amends Developing a road map / timeline for the SIL amendments Article 6(d): CO proposal adopted Article 8(1)(b) to be amended MD to give further consideration to Article 8 Agreement on Article 10 Agreement on Article 12 Article 15: remedy needed for security created in breach of prohibition (cf. Prof. Goode article) Agreement that Prof. Goode s involvement not required Ad-hoc academic support still needed SIL 1 to be progressed separately as a priority SIL 2 and 3 could be rolled up Group aiming to provide LDO) with proposed drafting Road map and schedule of meetings needed to keep up momentum through 2018 MD to consider Articles 8 and 9 MD to consider codifying of Prof. Goode s article (re Articles 15/39) JFL to start work on a timeline and roadmap for the SIL JFL to propose a schedule of meetings for the year to come JFL to start putting together a WIT TF to open a dialogue with the JFSC on the tangibles register TF to consider the need for further consultation on dropping the recharacterization provision TF to seek support for the group s preferred approach in relation to the LDO [6] March 2018 Proposed agenda: Draft SIL 1 road map / timeline Articles 4 and 5: PG s drafting Article 8(1)(b): JR s drafting Articles 8 and 9: MD to revert Approve JFL road map / timeline for 2018, with backing from government (TF) Agree draft of Articles 4 and 5 2 JFL to commence drafting WIT Proposed drafting for Article 15 (or 39) to be prepared of discussions on Articles 17-20
Article 15: MD to revert on codifying of Prof. Goode s article Article 17 (Attachment: effect) Article 18 (Attachment: general rule) Article 20 (Investment securities) [3] April 2018 Proposed agenda: Article 15: proposed drafting Articles 17-20: revised drafting Article 22 (Perfection by possession, control or registration) Article 24 (Continuation of security interests in proceeds) Article 25 (Continuous perfection of security interests in proceeds) Article 27 (Temporary perfection: negotiable instrument or investment security returned to grantor) Article 28 (Perfection under this Law if collateral moved to Jersey) [1] May 2018 Proposed agenda: Articles 22-28: revised drafting Approve amendments to Articles 8 and 9 Agree approach to Article 15 Progress discussions of Articles 17, 18 and 20 Agree drafting for Articles 15 on Articles 17-20 22-28, subject to follow up on Articles 22-28 Likely next steps: of discussions on Articles 22-28 3
Article 29 (Priority when Law provides no other way of determining priority) Article 30 (Special priority rules for certificated investment securities, securities accounts and deposit accounts) Article 30A (Bank s right of set-off not affected) Article 30B (Intermediary s right of set-off not affected) Article 31 (Priority where security interest transferred) Article 32 (Voluntary subordination) Article 34 (Priority of purchase money security interest in intangible movable property and proceeds) Article 35 (Taking collateral free of unperfected security interests) Article 36 (Creditor who receives payment of debt takes free) Article 38 (Purchaser of investment security takes free) [5] June 2018 Proposed agenda: Articles 29-38: revised drafting 29-38, subject to follow up on Articles 29-38 of discussions on Articles 29-38 4
Article 39 (Effect of restriction on assignment (whether or not by way of security)) Article 40 (Account debtor s duty (where assignment not by way of security)) Article 41 (Rights of assignee of receivable (whether or not assignment is by way of security)) Article 43 (Enforcement), including the proposed new Articles 43A to H [3] July 2018 Proposed agenda: Articles 39-43: revised drafting Article 44 (Notice of appropriation or sale of collateral) Article 46 (Duty to obtain fair valuation or fair price) Article 48 (Secured party to give statement of account to grantor and others) Article 49 (Distribution of surplus) Article 50 (Surplus may be paid into court) Article 51 (When does a surplus exist?) 39-43, subject to follow up on Articles 39-43 44-54, subject to follow up of discussions on Articles 39-43 of discussions on Articles 44-54 5
Article 53 (Effect of disposal of collateral to purchaser for value and in good faith) Article 54 (Entitled persons may redeem collateral; grantor may reinstate agreement) [7] August 2018 Proposed agenda: Articles 44-54: revised drafting Article 56 (Secured party s powers not affected by insolvency) Article 57 (Certain provisions of Bankruptcy (Désastre) (Jersey) Law 1990 not affected) Article 58 (Certain provisions of Companies (Jersey) Law 1991 not affected) Article 59 (Limited avoidance of security interest or assignment in case of bankruptcy), including proposed new Article 59A Article 62 (Contents of registration) Article 63 (Timing and other formalities) Article 66 (Registration invalid only if seriously misleading) on Articles 44-54 56-72, subject to follow up of discussions on Articles 56-72 6
Article 69 (Registration reflecting transfer where prior registration) Article 72 (Transferee becomes secured party or assignee) [4] September 2018 Proposed agenda: Articles 56-72: revised drafting Article 75 (Demand for registration of financing change statement) Article 80 (Removal of data from register) Article 85 (Secured party to provide information) Schedule 4 (Parties may agree otherwise in relation to themselves) and next steps for legislative process [2] October 2018 Proposed agenda: Update from JFL on progress of WIT on Articles 44-54 on all remaining Articles WIT to be in agreed form (subject to any final comments) and ready to submit to Government TF in a position to action WIT with government Take the LDO through the key drafting Address any initial questions or concerns from LDO / JFSC / government on the WIT JFL to finalise WIT and circulate to the group for sign-off JFL to submit the WIT to government by [12] September TF to take the lead on progressing WIT, preparing the law drafting instructions and Consultation paper (with JFL support as needed) TF to line up a representative of the Law Draftsman s Office (LDO) to attend the next meeting JFL to liaise with JFSC ahead of next meeting and secure attendance of a representative (if relevant) JFL to support / coordinate with government to progress WIT TF and LDO to progress with the Consultation Paper 7
Discussion with a representative of the Law Draftsman s Office (LDO) Discussion with a representative of the JFSC (if relevant) Agree next steps [6] November 2018 Proposed agenda: Update from JFL on progress of WIT Review of the draft Consultation Paper with the LDO Update on further discussions with JFSC (if relevant) Agree next steps [4] December 2018 Proposed agenda: Update from JFL on progress of Consultation Agree next steps and Schedule of meetings and action plan for 2019 Provide feedback to TF / LDO on the draft Consultation Paper Address any remaining issues with LDO / JFSC / government Receive an update on the progress of the Consultation To anticipate further industry input required following the close of the Consultation Agree a schedule of meetings for 2019 JFL to support / coordinate with government to progress WIT TF and LDO to finalise the Consultation Paper and circulate to the group for final review Consultation to be launched by [15] November TF to feedback at next meeting on the outcome of the Consultation JFL to continue to support / coordinate with TF on Consultation process JFL to circulate a draft action plan and schedule of meetings for 2019 8