BEFORE THE SECRETARY OF STATE

OF THE STATE OF MONTANA

 

In the matter of the amendment of ARM 44.6.105, 44.6.109, 44.6.113, and 44.6.202 and the repeal of ARM 44.6.108 pertaining to filing UCC documents

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NOTICE OF PUBLIC HEARING ON PROPOSED AMENDMENT AND REPEAL

 

TO: All Concerned Persons

 

            1. On August 15, 2019, at 9:00 a.m., the Secretary of State will hold a public hearing in the Secretary of State's Office Conference Room, Room 260, State Capitol Building, Helena, Montana, to consider the proposed amendment and repeal of the above-stated rule.

 

2. The Secretary of State will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact the Secretary of State no later than 5:00 p.m., August 8, 2019, to advise us of the nature of the accommodation that you need.  Please contact Joe DeFilippis, Secretary of State's Office, P.O. Box 202801, Helena, MT 59620-2801; telephone (406) 444-5476; fax (406) 444-3976; TDD/Montana Relay Service (406) 444-9068; or e-mail jdefilippis@mt.gov.

 

3. The rules proposed to be amended are as follows, new matter underlined, deleted matter interlined:

 

44.6.105 UNIFORM COMMERCIAL CODE FEES (1) through (11) remain the same.

(12) Computer printout of farm product collateral description            no charge

(13) remains the same but is renumbered (12).

(14) If a document is rejected because of deficiencies in the filing, a reprocessing fee of 50 percent of the initial filing fee will be assessed each time the document is resubmitted.

(15) Documents filed with inadequate funds will be rejected and when refiled must be accompanied by a dollar amount that satisfies the initial filing fee and includes the 50 percent reprocessing fee.

(16) (13)  The All filings and fees will be collected for conducting business via electronic means, and no hard copies will be provided are the same as for hard copy transactions.

(17) (14)  Uniform Commercial Code bulk data are is only available through electronic means, $1,000 per month.

(18) remains the same but is renumbered (15).

 

            AUTH: 2-15-405, 30-9A-526, MCA

            IMP: 2-15-405, 30-9A-525, 71-3-125, MCA

 

44.6.109 FORMAT REQUIREMENTS FOR FILING AN EFFECTIVE FINANCING STATEMENT LIEN UNDER THE FEDERAL FOOD SECURITY ACT OF 1985 (1) The format for filing an effective financing statement lien is as follows:

(a) font size on all documents must be at least a 10 point normal (not condensed) font;

(b) all forms must be typewritten (handwritten forms will be rejected); and

(c) all forms must be printed on 8 1/2" by 11" paper.

(2) Effective financing statement lien filings must be filed on the following forms or they will be rejected:

(a) Montana's effective financing statement;

(b) Montana's effective financing statement amendment;

(c) Montana's effective financing statement addendum; or

(d) Montana's effective financing statement amendment addendum.

(3) The forms listed in (2), as they existed on August 29, 2003, are incorporated by reference and are available at www.sos.mt.gov.

(1) All financing statement liens under the Federal Food Security Act of 1985 must be filed electronically via the Secretary of State's Business Services Division website.

(4) remains the same but is renumbered (2).

(a) through (d) remain the same.

(e) signed, authorized, or otherwise authenticated by the debtor;

(f) through (h) remain the same.

(i) signed, authorized, or otherwise authenticated by the secured party.

(5) An amendment to an effective financing statement is required when a change would render the farm bill master list entry no longer informative as to what is subject to the security interest in question. The effective financing statement amendment form submission must be filed online used and must include:

(a) an amendment including terminations that must be signed, authorized, or otherwise authenticated by the secured party;

(b) an amendment modifying the debtor and/or collateral information that must be signed, authorized, or otherwise authenticated by the debtor;

(i) and (c) remain the same.

(d) only one filing number per submission form;

(e) only one amendment per submission form is permitted;

(f) and (g) remain the same.

 

            AUTH: 30-9A-526, MCA

            IMP:    30-9A-501, 30-9A-502, 71-3-125, MCA

 

44.6.113 DEFINITIONS AND REQUIREMENTS FOR ONLINE FILING 

(1) All Uniform Commercial Code (UCC) liens must be filed electronically via the Secretary of State's Business Services Division website.

(1) (2)  The following definitions apply for filing Uniform Commercial Code (UCC) liens and amendments online:

(a) through (c) remain the same.

(d) "Signature" means an electronic signature.

(d) (e)  "SIMS" "SOS Enterprise" is the Secretary of State's online information management system.

(e) (f)  "Submitter" is a person or entity who, after having been authenticated to SIMS SOS Enterprise via ePass, is able to file lien notices or amendments or perform lien searches online.

(2) remains the same but is renumbered (3).

(3) Lien documents filed through the use of internet technology are considered to be liens filed online.

(4) The following liens are acceptable for online filing:

(a) initial financing statements and associated amendments that meet the requirements of Title 30, chapter 9A, MCA;

(b) effective financing statements and associated amendments that meet the requirements of the federal Food Security Act of 1985.

(i) (4)  An effective financing statement lien and amendment shall may be filed electronically. without the signature of the debtor and secured party.

(ii) If an original or reproduced paper document is filed, the lien must be authorized or authenticated by the debtor, and be filed by the secured party.

(5) The following liens are unacceptable for online filing:

(a) notice of child support liens;

(b) notice of federal tax liens; and

(c) Title 71, MCA, liens.

(6) through (8) remain the same but are renumbered (5) through (7).

(9) (8)  UCC and effective financing statement lien notices or amendments that are successfully completed and submitted online will be considered filed once payment has successfully been completed by the submitter. The structure of the online screens will guide the submitter while ensuring the notice or amendment adheres to all rules, laws, and regulations that govern the document. The submitter is notified by SIMS if the information entered does not adhere to the requirements that govern lien notices and amendments. A message confirming successful completion and acceptance will appear online when the filing is accepted by SIMS.

(10) through (13) remain the same but are renumbered (9) through (12). 

 

AUTH: 2-15-404, 30-9A-526, MCA

           IMP: 2-15-401, 2-15-404, 30-9A-502, 71-3-125, MCA

 

44.6.202 EFFECTIVE DATE AND TIME (1) Any lien notice or amendment delivered by the postal service by 4:00 p.m. has an effective time and date of 8:00 a.m. on the delivery date. Any lien notice or amendment delivered by facsimile, walk-in, or express delivery service by 4:00 p.m. has an effective time and date consistent with the delivery date and time. 

(2) Any lien notice or amendment delivered by the postal service, facsimile, walk-in, or express delivery service received after 4:00 p.m. has an effective time and date of 8:00 a.m. the next business day.

            (3) (1)  Any lien notice or amendment filed online through the Secretary of State's electronic filing system will receive the effective date and time the same as it was successfully recorded in the UCC database. 

 

AUTH: 2-15-404, 30-9A-526, MCA

           IMP: 2-15-401, 2-15-404, 30-9A-519, 71-3-125, MCA

 

            4. The rule proposed to be repealed is as follows:

 

            44.6.108 FORMAT REQUIREMENTS FOR THE FILING OF UNIFORM COMMERCIAL CODE LIENS

 

            AUTH: 30-9A-526, MCA

            IMP: 30-9A-102, 30-9A-501, 30-9A-502, MCA

 

REASONABLE NECESSITY: ARM 44.6.105, 44.6.109, 44.6.113, and 44.6.202 are proposed to be amended and ARM 44.6.108 is proposed to be repealed to allow the Secretary of State's Office to accept and maintain all UCC records electronically. The changes are being proposed at this time in order to create an efficient operational model that is cost effective for customers and the Secretary of State's office, and so that they may be adopted in a timely manner to allow the Secretary of State the opportunity to update its electronic filing system. 

 

FISCAL IMPACT: The Secretary of State estimates that the proposed fee change in ARM 44.6.105 will affect 500 applicants and decrease revenue by $625.

 

            5. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to: Joe DeFilippis, Secretary of State's Office, P.O. Box 202801, Helena, Montana 59620-2801, or by e-mailing jdefilippis@mt.gov, and must be received no later than 5:00 p.m., August 26, 2019.

 

6. Austin James, Secretary of State's Office, has been designated to preside over and conduct the hearing.

 

7. The Secretary of State maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request which includes the name and mailing address of the person to receive notices and specifies that the person wishes to receive notices regarding administrative rules, corporations, elections, notaries, records, uniform commercial code, or combination thereof. Such written request may be mailed or delivered to the Secretary of State's Office, Administrative Rules Services, 1301 E. 6th Ave, P.O. Box 202801, Helena, MT 59620-2801, faxed to the office at (406) 444-3976, or may be made by completing a request form at any rules hearing held by the Secretary of State's Office.

 

8. The bill sponsor contact requirements of 2-4-302, MCA, do not apply.

 

9. With regard to the requirements of 2-4-111, MCA, the Secretary of State has determined that the amendment and repeal of the above-referenced rules will not significantly and directly impact small businesses.  Currently the majority of customers complete their filings online without negative impact.

 

 

/s/  AUSTIN JAMES                                        /s/ COREY STAPLETON   

Austin James                                                   Corey Stapleton

Rule Reviewer                                                 Secretary of State

 

Dated this 16th day of July, 2019.