Arkansas 2025 Regular Session

Arkansas House Bill HB1736 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		Stricken language would be deleted from and underlined language would be added to present law.
2		-	Act 603 of the Regular Session
3	2		ANS151 03/10/2025 5:55:12 PM ANS151
4	3		State of Arkansas 1
5	4		95th General Assembly A Bill 2
6	5		Regular Session, 2025 HOUSE BILL 1736 3
7	6		4
8	7		By: Representative M. Brown 5
9	8		By: Senator Dees 6
10	9		7
11	10		For An Act To Be Entitled 8
12	11		AN ACT TO AMEND ARTICLE 9 OF THE UNIFORM COMMERCIAL 9
13	12		CODE; AND FOR OTHER PURPOSES. 10
14	13		11
15	14		12
16	15		Subtitle 13
17	16		TO AMEND ARTICLE 9 OF THE UNIFORM 14
18	17		COMMERCIAL CODE. 15
19	18		16
20	19		BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 17
21	20		18
22	21		SECTION 1. Arkansas Code § 4 -9-406(d), concerning the ineffectiveness 19
23	22		of certain assignments under the Uniform Commercial Code, is amended to read 20
24	23		as follows: 21
25	24		(d) Except as otherwise provided in subsection (e) subsections (e) and 22
26	25		(k) and §§ 4-2A-303 and 4-9-407, and subject to subsection (h), a term in an 23
27	26		agreement between an account debtor and an assignor or in a promissory note 24
28	27		is ineffective to the extent that it: 25
29	28		(1) prohibits, restricts, or requires the consent of the account 26
30	29		debtor or person obligated on the promissory note to the assignment or 27
31	30		transfer of, or the creation, attachment, perfection, or enforcement of a 28
32	31		security interest in, the account, chattel paper, payment intangible, or 29
33	32		promissory note; or 30
34	33		(2) provides that the assignment or transfer or the creation, 31
35	34		attachment, perfection, or enforcement of the security interest may give rise 32
36	35		to a default, breach, right of recoupment, claim, defense, termination, right 33
37	36		of termination, or remedy under the account, chattel paper, payment 34
38	37		intangible, or promissory note. 35
39	38		36 HB1736
40	39
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42	41		SECTION 2. Arkansas Code § 4 -9-406(f), concerning the ineffectiveness 1
43	42		of certain legal restrictions on assignments under the Uniform Commercial 2
44	43		Code, is amended to read as follows: 3
45	44		(f) Except as otherwise provided in subsection (k) and §§ 4-2A-303 and 4
46	45		4-9-407 and subject to subsections (h) and (i), a rule of law, statute, or 5
47	46		regulation that prohibits, restricts, or requires the consent of a 6
48	47		government, governmental body or official, or account debtor to the 7
49	48		assignment or transfer of, or creation of a security interest in, an account 8
50	49		or chattel paper is ineffective to the extent that the rule of law, statute, 9
51	50		or regulation: 10
52	51		(1) prohibits, restricts, or requires the consent of the 11
53	52		government, governmental body or official, or account debtor to the 12
54	53		assignment or transfer of, or the creation, attachment, perfection, or 13
55	54		enforcement of a security interest in the account or chattel paper; or 14
56	55		(2) provides that the assignment or transfer or the creation, 15
57	56		attachment, perfection, or enforcement of the security interest may give rise 16
58	57		to a default, breach, right of recoupment, claim, defense, termination, right 17
59	58		of termination, or remedy under the account or chattel paper. 18
60	59		19
61	60		SECTION 3. Arkansas Code § 4 -9-406, concerning the discharge of an 20
62	61		account debtor under the Uniform Commercial Code, is amended to add an 21
63	62		additional subsection to read as follows: 22
64	63		(k) Subsections (d), (f), and (j) do not apply to a security interest 23
65	64		in an ownership interest in a general partnership, limited partnership, or 24
66	65		limited liability company. 25
67	66		26
68	67		SECTION 4. Arkansas Code § 4 -9-408(a), concerning the ineffectiveness 27
69	68		of certain assignments under the Uniform Commercial Code, is amended to read 28
70	69		as follows: 29
71	70		(a) Except as otherwise provided in subsection (b) subsections (b) and 30
72	71		(g), a term in a promissory note or in an agreement between an account debtor 31
73	72		and a debtor which relates to a health -care-insurance receivable or a general 32
74	73		intangible, including a contract, permit, license, or franchise, and which 33
75	74		term prohibits, restricts, or requires the consent of the person obligated on 34
76	75		the promissory note or the account debtor to, the assignment or transfer of, 35
77	76		or creation, attachment, or perfection of a security interest in, the 36 HB1736
78	77
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80	79		promissory note, health -care-insurance receivable, or general intangible, is 1
81	80		ineffective to the extent that the term: 2
82	81		(1) would impair the creation, attachment, or perfection of a 3
83	82		security interest; or 4
84	83		(2) provides that the assignment or transfer or the creation, 5
85	84		attachment, or perfection of the security interest may give rise to a 6
86	85		default, breach, right of recoupment, claim, defense, termination, right of 7
87	86		termination, or remedy under the promissory note, health -care-insurance 8
88	87		receivable, or general intangible. 9
89	88		10
90	89		SECTION 5. Arkansas Code § 4 -9-408(c), concerning the ineffectiveness 11
91	90		of certain legal restrictions on assignments under the Uniform Commercial 12
92	91		Code, is amended to read as follows: 13
93	92		(c) A Except as otherwise provided in subsection (g), a rule of law, 14
94	93		statute, or regulation that prohibits, restricts, or requires the consent of 15
95	94		a government, governmental body or official, person obligated on a promissory 16
96	95		note, or account debtor to the assignment or transfer of, or creation of a 17
97	96		security interest in, a promissory note, health -care-insurance receivable, or 18
98	97		general intangible, including a contract, permit, license, or franchise 19
99	98		between an account debtor and a debtor, is ineffective to the extent that the 20
100	99		rule of law, statute, or regulation: 21
101	100		(1) would impair the creation, attachment, or perfection of a 22
102	101		security interest; or 23
103	102		(2) provides that the assignment or transfer or the creation, 24
104	103		attachment, or perfection of the security interest may give rise to a 25
105	104		default, breach, right of recoupment, claim, defense, termination, right of 26
106	105		termination, or remedy under the promissory note, health -care-insurance 27
107	106		receivable, or general intangible. 28
108	107		29
109	108		SECTION 6. Arkansas Code § 4 -9-408, concerning restrictions on certain 30
110	109		assignments under the Uniform Commercial Code, is amended to add an 31
111	110		additional subsection to read as follows: 32
112	111		(g) This section does not apply to a security interest in an ownership 33
113	112		interest in a general partnership, limited partnership, or limited liability 34
114	113		company. 35
115		-	APPROVED: 4/14/25 36 HB1736
116		-
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118		-	1
	114	+	36