The Uniform Commercial Code (UCC) governs commercial transactions in the United States, providing a standardized set of laws for dealings involving the sale of goods, leasing of goods, negotiable instruments, secured transactions, and other commercial activities. It is one of the most important frameworks for regulating commercial law across different states.
Here’s a breakdown of the key areas the UCC governs:
1. Sales of Goods (Article 2): This governs the sale of goods (tangible personal property), including rules on contracts, obligations, and warranties. It provides guidelines for transactions like pricing, delivery, and risk of loss.
2. Leases (Article 2A): This article applies to the leasing of goods, defining how leasing contracts work, including parties’ rights and remedies in the event of a breach.
3. Negotiable Instruments (Article 3): This covers financial instruments such as checks, promissory notes, and drafts, dictating their creation, transfer, and enforcement.
4. Bank Deposits and Collections (Article 4): This deals with the relationship between banks and their customers, including rules on deposits, checks, and collection processes.
5. Funds Transfers (Article 4A): It regulates electronic funds transfers between parties and banks.
6. Letters of Credit (Article 5): Governs the use of letters of credit, commonly used in international trade to guarantee payment.
7. Bulk Sales (Article 6): Provides rules for the sale of business assets in bulk, aimed at preventing fraudulent transfers when a business is sold.
8. Warehouse Receipts, Bills of Lading, and Other Documents of Title (Article 7): This article addresses the handling of goods in storage and transportation, including warehouse receipts and bills of lading.
9. Investment Securities (Article 8): Governs the sale and transfer of securities, such as stocks and bonds, including the rights of the investors.
10. Secured Transactions (Article 9): This is a vital part of the UCC that governs transactions involving security interests in personal property (collateral), including the creation, perfection, and enforcement of security interests.
Each U.S. state has adopted the UCC with some variations, which creates a uniform legal framework that facilitates business operations across state lines. The code is essential for handling modern business transactions, especially those involving goods and “commercial” paper.
What is “commercial” ?
Everything is the pubic is “commercial” including just about all crimes, as explicitly stipulated in the Code of Federal Regulations.
27 Code of Federal Regulations § 72.11 – Meaning of terms.
“Commercial crimes. Any of the following types of crimes (Federal or State): Offenses against the revenue laws; burglary; counterfeiting; forgery; kidnapping; larceny; robbery; illegal sale or possession of deadly weapons; prostitution (including soliciting, procuring, pandering, white slaving, keeping house of ill fame, and like offenses); extortion; swindling and confidence games; and attempting to commit, conspiring to commit, or compounding any of the foregoing crimes. Addiction to narcotic drugs and use of marihuana will be treated as if such were commercial crime.”
