US Laws, Codes, Statutes & Cases

      Sec. 42a-8-103. Rules for determining whether certain obligations and interests are securities or financial assets. (a) A share or similar equity interest issued by a corporation, business trust, joint stock company or similar entity is a security.

      (b) An "investment company security" is a security. "Investment company security" means a share or similar equity interest issued by an entity that is registered as an investment company under the federal investment company laws, in interest in a unit investment trust that is so registered, or face-amount certificate issued by a face-amount certificate company that is so registered. Investment company security does not include an insurance policy or endowment policy or annuity contract issued by an insurance company.

      (c) An interest in a partnership or limited liability company is not a security unless it is dealt in or traded on securities exchanges or in securities markets, its terms expressly provide that it is a security governed by this article or it is an investment company security. However, an interest in a partnership or limited liability company is a financial asset if it is held in a securities account.

      (d) A writing that is a security certificate is governed by this article and not by article 3, even though it also meets the requirements of that article. However, a negotiable instrument governed by article 3 is a financial asset if it is held in a securities account.

      (e) An option or similar obligation issued by a clearing corporation to its participants is not a security, but is a financial asset.

      (f) A commodity contract, as defined in section 42a-9-102(a)(15), is not a security or a financial asset.

      (g) A document of title is not a financial asset unless subdivision (10)(iii) of subsection (a) of section 42a-8-102 applies.

      (1959, P.A. 133, S. 8-103; P.A. 79-435, S. 2; P.A. 97-182, S. 3; P.A. 01-132, S. 146; P.A. 04-64, S. 59.)

      History: P.A. 79-435 amended section to distinguish between certificated and uncertificated securities, applying former provision to certificated securities and adding provision re uncertificated securities; P.A. 97-182 entirely replaced former provisions re issuer's lien with provisions re rules for determining whether certain obligations and interests are securities or financial assets; P.A. 01-132 amended Subsec. (f) to replace Sec. 42a-9-115 with Sec. 42a-9-102(a)(15) as the statutory reference for the definition of a "commodity contract"; P.A. 04-64 added Subsec. (g) re document of title to conform to revisions made to article 7 by the same act.

      See Sec. 42a-8-209 for successor provisions to Sec. 42a-8-103, revised to 1997, re issuer's lien.