UCC For Jewelers


What is the UCC?


The Uniform Commercial Code (UCC) is, in essence, a comprehensive modern collection of various statutes relating to commercial transactions including sales, leases, negotiable instruments, bank deposits and collections, funds transfers, letters of credit, bulk sales, documents of title, investment securities, and secured transactions.

The Code was initially approved by its sponsors and the American Bar Association In 1952, and it has been amended several times in succeeding years. The Code addresses most aspects of commercial law and is generally viewed as one of the most significant developments in American law.

The UCC text and draft revisions are written by experts in commercial law and submitted as drafts for approval to the National Conference of Commissioners on Uniform State Laws  (now referred to as the Uniform Law Commissioners), and the American Law Institute.

These quasi-public organizations meet and decide whether to endorse these drafts or to send them back to the experts for revision. The revision process may result in several different revisions of the original draft. Once a draft is endorsed, the Uniform Law Commissioners recommend that the states adopt these rules.

The UCC is a model code, so it does not have legal effect unless the individual legislatures enact UCC provisions as statutes that apply to their respective jurisdictions. Currently, the UCC has been enacted (with some local variation) in 49 states, the District of Columbia, the Virgin Islands, as well as partially in Louisiana.

The volume of the international, interstate, and multistate commercial transactions requires that the administration of the UCC be conducted in a manner that promotes both local and multi-jurisdictional commerce by striving for uniformity in policies and procedures among the various states. 

Organization of the UCC

The rules for each one of the transactional areas covered by the UCC are collected into separate parts called an ‘article’ and are arranged systematically as sections grouped into consecutively numbered parts. As of 2008, the types of transactions included within the Code are:

  • Sales (Amended Article 2)
  • Leases (Amended Article 2A)
  • Negotiable Instruments, previously known as Commercial Paper {Revised Article 3)
  • Bank Deposits and Collections (Amended Article 4)
  • Funds Transfers (Article 4A)
  • Letters of Credit (Revised Article 5)
  • Bulk Sales, previously known as Bulk Transfers (Revised Article 6)
  • Documents of Title (Revised Article 7)
  • Investment Securities (Revised Article 8) and
  • Secured Transactions (Revised Article 9)