MINISTER FOR ECONOMIC DEVELOPMENT
REPORT IN RELATION TO:
Law drafting instructions for the drafting of an Order in relation to the Security Interests (Jersey) Law 2012
Introduction
The Security Interests (Jersey) Law 2012 (“the Law”) introduces the concept of perfection by registration for security interests and Assignment of Receivables in Jersey. This has previously not been possible under the Security Interests (Jersey) Law 1983.
A number of other jurisdictions around the world have introduced Security Interests legislation which permits perfection by registration. These jurisdictions include New Zealand, Australia, Texas and British Columbia. These jurisdictions have created registers of Security Interests which have been reviewed by both Government and the JFSC when formulating the design of the Jersey Security Interests Register (“the Register”).
Although registration is dealt with in Part 8 of the Law, many areas relating to the process and procedure of registration are not covered. Article 92 of the Law gives the Minister a power to make Orders relating to the procedures, requirements, and other matters, in respect of the register and its operation.
The Order will therefore be drafted to contain the relevant procedures and requirements for operation of the Register.
Decision
This Ministerial Decision, if made, permits the submission of Law Drafting Instruction to the Law Draftsman’s Office for the drafting of an Order relating to registration under the Law.
Background
Article 92 of the Law provides as follows:
"92 Orders
(1) The Minister may make Orders, not inconsistent with this Law, for or with respect to any matter that by this Law is required or permitted to be prescribed by Order or that is necessary or convenient to be prescribed by Order for carrying out or giving effect to this Law and, in particular, but without prejudice to the generality of the foregoing, for or with respect to any of the following –
(a) procedures, requirements, and other matters, in respect of the register and its operation, including access to it, its location, suspension of its operation, suspension of access to it and the hours when it is to be accessible;
(b) procedures, requirements, and other matters, in respect of registration (or entering in the register) under this Law, including the following –
(i) the description of collateral, or of proceeds, that is to be included in financing statements and financing change statements,
(ii) the description of receivables and their assignments that is to be included in financing statements and financing change statements,
(iii) a requirement to describe by serial number,
(iv) the form and content of financing statements, of financing change statements, and of other data authorized or required by or under this Law to be entered or registered in the register,
(v) the effectiveness, renewal, repetition, discharge, expiry, and amendment, of registration;
(c) the data to be entered in the register to effect, renew, repeat, discharge, or amend, registration;
(d) any other matters relating to registration under this Law;
(e) procedures, requirements, and other matters, in respect of the form and use of verification statements to confirm a registration;
(f) procedures, requirements, and other matters in respect of searching the register, including criteria on which a search may be conducted, the method of disclosure and the form and content of search results;
(g) forms in general for the purposes of this Law;
(h) procedures, requirements, and other matters in respect of notices for the purposes of this Law, including the matters in respect of which notices are required and the form of notices under this Law;
(i) the functions of the registrar.
(2) An Order made under this Law may contain such transitional, consequential, incidental or supplementary provisions, or such savings, as appear to the Minister to be necessary or expedient for the purposes of the Order.
(3) A reference in this Article to procedures does not include the procedure of any court."
In accordance with Article 92 of the Law, the intention is for the Law Draftsman to prepare a draft Order in relation to the register, its operation, and registration (including certain procedures) on the basis explained below.
It should be noted that a policy decision has been made to allow the Registrar to decide the data requirements for the register through ‘Guidance notes’ which will be published online. This is intended to conform with Article 62 (2) of the Law which provides the Registrar with this power.
The Order will require provisions dealing with:
i) Interpretation
ii) Registration number and PIN numbers
iii) Change Demands
iv) Certification of financing statements
v) Contents of Verification Statements
vi) Searching the Register
vii) Access or Limiting Access to the Register
viii) Fees for the Register
ix) Removal of data from the Register
x) Disclaimers for the Register
xi) Data protection statement for the register
It is anticipated that the Law Draftsman will benefit from background reading including:
- New Zealand Personal Property Securities Regulations 2001
- Part 5 of the Australian Personal Property Securities Regulations 2010
Financial and Manpower Implications
This decision has no additional financial or manpower implications for the States of Jersey.
Recommendation
As the Order is critical to the Implementation of the Law it is recommended that the Minister makes the decision outlined above.
Finance Industry Development
5 February 2013
gov.je