Senate committee substitute to the 3rd edition makes the following changes. Makes conforming changes to the act’s titles. Adds the following content.

Part II.

Section 29.

Directs the Revisor of Statutes (Revisor) to make the following changes, subject to grammatical rules and general drafting conventions of capitalization:

1. Subject to bullet 2 below, replace "e-mail", "electronic mail", or "electronic mailing" with "email" in GS 1-75.4, 1-507.34, 1-539.2A, 9 1A-1, Rule 4, 1A-1, Rule 5, and any other statutes in which any of these terms appear and make a similar change when any of these terms is plural.
2. Replace "registered, certified, or electronic mail" with "registered mail, certified mail, or email" in GS 143-293.
3. Subject bullets 4 and 5 below, make "Internet" lowercase in GS 14-113.20, 14-113.30, 14-113.31, 14-118.7, 14-196.3, and any other statutes in which the term appears.
4. Replace "Internet protocol" with "Internet Protocol" in GS 105-164.3, 130A-480, and 143B-1400.
5. Replace "internet web site", "internet website", "internet site", or "web site", including any variation in capitalization of any of these terms, with "website"  in GS 7A-38.2, 7A-38.3F, 10B-36, 14-44.1, 14-202.5, and any other statutes in which any of these terms appear and make a similar change when any of these terms is plural.
6. Replace "rule making" or "rule-making" with "rulemaking" in GS 7B-4001,10B-126, 15C-12, 18B-105, 20-37.22, and any other statutes in which either of these terms appear.

Authorizes the Revisor to delete duplicative language resulting from these changes and may replace "an" with "a" to conform with these changes.

Section 30.

Makes technical changes to GS 14-288.9 (assault upon emergency personnel).

Section 31.

Now specifies that the effect of an expunction under GS 15A-145.5 (expunction of certain misdemeanors and felonies without age limitations), GS 15A-145 (expunctions of misdemeanors of first offenders under age 18 and underage persons possessing alcohol), GS 15A-145.1 (expunctions for first offenders under age 18 for convictions of certain gang offenses), GS 15A-145.2 (expunction of records for first offenders over 21 for certain drug offenses), GS 15A-145.3 (expunction of first offender under 21 for certain toxic vapors offenses), GS 15A-145.4 (expunction of records for first offender under 18 for nonviolent felony), GS 15A-145.6 (expunction for certain defendants convicted of prostitution), GS 15A-145.7 (expunction of records for first offenders under 20 years of age at the time of the offense of certain offenses), GS 15A-145.8 (expunction of records when charges are remanded to district court for juvenile adjudication), GS 15A-145.8A (expunction of records under 18 for certain misdemeanors and felonies upon completion of sentence), GS 15A-145.9 (expunction of certain offenses committed by human trafficking victims), GS 15A-146 (expunction of records when charges are dismissed or there are findings of not guilty), GS 15A-147 (expunction of records when charges dismissed or findings of not guilty due to identity theft), and GS 15A-149 (expunction of records when pardon of innocence is granted) is governed by the prohibited practices by employers, educational institutions, agencies of State and local governments related to expunctions set forth in GS 15A-153 (currently, specifies that such persons whose records are expunged under GS 15A-145.5 shall be held thereafter under any provision of any law to be guilty of perjury or otherwise giving a false statement by reason of that person's failure to recite or acknowledge the arrest, indictment, information, trial, or conviction). Makes technical, organizational, and clarifying changes.  

Makes technical changes to GS 15A-153 (effect of expunction). Effective June 30, 2020.

Section 31.1.

Modernizes the language of GS 41-71 (creation of joint tenancy two or more persons owning property with right of survivorship). Effective June 30, 2020.

Section 32.

Makes technical changes to GS 48-3-309, including to the statute's title (mandatory criminal history checks for certain prospective adoptive parents).

Section 33.

Effective July 1, 2025, expands GS 58-36-43 so that the types of insurance policies where an insurer is not allowed to condition the acceptance, renewal or underwriting criteria of a policy on the policyholder accepting optional enhancement to include residential private flood insurance (currently, just automobile or homeowner’s enhancements). Makes technical changes, including to section title.

Section 34.

Changes references from “cash” to “currency” in Part 1 of Article 45 in GS Chapter 66 (Pawnbrokers and Currency (was, cash) Converters Modernization Act). Makes technical changes throughout the part. Amends GS 25-9-201 by removing references to regulations regulating the rates, charges, agreements, and practices for loans, credit sales, or other extensions of credit, and to any consumer-protection regulations.

Section 35.

Re-numbers the subunits of GS 75D-3 (State RICO act) to conform to the General Statutes numbering system and reorders the definitions in GS 75D-3 so that they appear in alphabetical order. Removes repealed statutes from the statutory exemptions from the definition of racketeering activity under GS 75D-3 (definitions provision) as amended by the act and Section 1(b) of SL 2024-22 (pertaining to money launder laws). Makes technical, clarifying, and organizational changes. Limits the person entitled to initiate and prosecute a RICO forfeiture proceeding under GS 75D-5 to the AG (was, AG or designated representative thereof). Makes technical and clarifying changes. Makes technical changes to GS 75D-8 (available RICO remedies).

Section 35.1.

Repeals Article 5 of GS Chapter 77 (pertaining to the High Rock Lake Marine Commission).

Section 36.

Reorders the definitions in GS 85B-1 (concerning auctions and auctioneers) so they appear in alphabetical order. Makes technical and organizational changes to GS 85-1 as amended by the act.

Section 36.1.

Removes references to GS 115C-105.47, pertaining to safe schools plans, which was repealed by SL 2011-145 in GS 115C-390.2 (discipline policies) and GS 115C-390.5. Makes technical and clarifying changes.

Section 37.

Re-designates GS 128-26A to GS 128-26.1 (concerning reciprocity of credible service with other State-administered retirement systems under the Local Government Employees Retirement System). 

Section 38.

Modifies defined term cost in GS 131A-3 so that the described costs of reimbursing a public or nonprofit agency so that it no longer excludes reimbursements or refinance of cost if payment was made or cost incurred two years prior to the enactment of the Article (i.e. November 6, 2019). Adds specialized hospitals to the examples provided in defined term health care facilities.

Makes organizational and technical changes.  

Removes defined term programmatic supervision from GS 143B-181.16 (definitions pertaining to the long-term care ombudsman office) and modifies term willful obstruction so it includes unnecessary obstruction and applies to both the Regional and States Ombudsmen. Makes organizational and technical changes, including to the statute's title.

Section 39.1.

Recodifies these subsections of GS Chapter 131E as follows:

• GS 131E-176(5a) to GS 131E-176(5c) (definition of chemical dependency treatment facility)
• GS 131E-176(10) to GS 131E-176(7e) (definition of health maintenance organization or HMO)
• GS 131E-176(13) to GS 131E-176(13d) (definition of hospital).

Directs the Revisor to substitute "GS 131E-176" for "GS 131E-176(13)" wherever it appears in GS 90-414.4.

Section 39.2.

Amends GS 131E-176 as amended by the act, to make technical, conforming organizational, and clarifying changes to the definitions contained therein, including removing outdated language. Makes conforming change to term State Medical Facilities Plan to remove language concerning mailing lists, notice of public hearings, and public notice and comment that are reenacted as new GS 131E-176.2 (concerning state medical facilities plans).

Makes technical changes to GS 131E-177 (designating DHHS as the State Health Planning and Development Agency). 

Section 39.3.

Effective November 21, 2026, makes technical changes to defined terms diagnostic center, magnetic resonance imaging scanner, and major medical equipment in GS 131E-176 as amended by the act. 

Effective November 21, 2025, makes technical change to term health service facility in GS 131E-176 as amended by the act.

Section 39.5.

Recodifies GS 143B-1209.58 (the National Crime Prevention and Privacy Compact) as GS 143B-1208.15.

Section 39.7.

Makes technical and clarifying changes to GS 143B-1320 (definitions, scope and exemptions for Article 15, concerning the Department of Information Technology, to GS Chapter 143B). Replaces references to “chapter” with “article.”

Section 40.

Changes reference from the Department of Public Safety to the Department of Adult Corrections as the agency excluded from Article 2A of GS Chapter 150B (the APA), with respect to matters relating to executions and solely to persons in its custody or under its supervision, including prisoners, probationers, and parolees in GS 150B-1(policy and scope). Makes conforming, technical, and clarifying changes.

Section 40.1.

Makes technical and clarifying changes to GS 163-129 (structure at voting places). Now provides that a county board of elections may demand and use any school or other State, county, or municipal building or part thereof that is supported of maintained by tax revenue as a voting precinct (currently, a county board of elections is entitled to demand and use the places described in the statute for such purposes). Specifies that this does not allow for demand and use of a tax-exempt church property without the church's express consent.

Section 40.2.

Updates statutory reference to the organizational report an affiliated party committee must provide to the State Board of Elections under GS 163-278.8B. Now provides that an affiliated party committee may use the name, symbol, and abbreviation of its political party (currently, they are “entitled to” use those things). Makes technical changes.

Section 41.

Modifies the effective date of SL 1983-601 (concerning lease fees for shellfish leases) so that the act no longer has to be reconsidered every six years by the specified NCGA committee

Section 42.

Retroactive to October 25, 2024, removes requirements in SL 2024-53 for the Department of Environmental Quality to report on their status of the two described submissions to the US National Oceanic and Atmospheric Administration (NOAA) that were directed to start on January 1, 2025, until repeal of the described statutory provisions under GS 113A-118 and GS 113A-115.1.

Section 42.1.

Makes technical change to reference to GS 135-7(g) to Section 1(c) of House Bill 477, 2025 Regular Session, should that act become law.

Part III.

Makes technical changes to GS 6-21.6 (concerning reciprocal attorneys’ fees provisions in business contracts).

Makes organizational changes to GS 10B-5 (notarial qualifications). Makes conforming changes to GS 10B-5(b)(8) (listing of notarial requirements) as reorganized by the act to account for reorganization. 

Makes the following further changes to GS 10B-5 as reorganized by the act. Removes requirement that a notarial commission application must be signed by the applicant in pen and ink, except for their initial application. Makes technical changes. 

Part IV.

Renames GS Chapter 50A’s title to Uniform Acts on Children (currently, Uniform Child Custody Jurisdiction and Enforcement Act and Uniform Deployed Parents Custody and Visitation Act). Adds new Article 4, the “Uniform Child Abduction Act" to GS Chapter 52A. Defines abduction, petition, record, state, travel documents, wrongful removal, and wrongful retention. Incorporates definitions of child, child-custody determination, child-custody proceeding, and court from GS 50A-102 (chapter definitions).  

Permits court to enter abduction prevention measures either on its own motion or upon the filing of petition by party to child custody action with notice to respondent, so long as the court determines that there is a credible risk of abduction of the child. Allows a petition to be filed in district if the court has jurisdiction to make a child-custody determination under the State’s Uniform Child-Custody Jurisdiction and Enforcement Act. Grants a district court temporary emergency jurisdiction if the court finds a credible risk of abduction.

Requires court to consider thirteen factors in determining existence of credible risk of abduction, including history of abduction; threats of abduction; actions taken to indicate a planned abduction including severing ties to the State (e.g., abounding employment, selling one’s home, undergoing a change in citizenship or nationality status that would affect their ability to remain in the US, etc.); history of domestic violence, stalking, child abuse or neglect; refusal to comply with a child custody order; lack of familial, cultural, financial or other ties to the State/strong familial, cultural, financial or other ties to another State or country; fraudulent attempts to obtain travel documents; the likelihood of respondent taking the child to a country that (1) does not provide for the extradition of an abducting parent or the return of an abducted child, (2) does not enforce or is not capable of enforcing the Hague Convention on the Civil Aspects of International Child Abduction, (3) has laws or practices that would prevent the petitioner from contacting the child, restrict the petitioner and child from traveling freely to see one another because of their gender, nationality, marital status or religion; (4) is included on the US Department of State’s current list of state sponsors of terrorism; (5) has no official US diplomatic presence; or (6) is engaged in active military action or war, to which the child may be exposed). Requires court to also consider any evidence that the respondent believed in good faith that the respondent's conduct was necessary to avoid imminent harm to the child or respondent and any other evidence that may be relevant to whether the respondent may be permitted to remove or retain the child.

If the court finds credible risk of abduction of the child, requires the court to enter an abduction protection order with required findings and measures and conditions that are reasonably calculated to prevent abduction of the child, giving due consideration to the custody and visitation rights of the parties. Requires that the order consider the age of the child, the potential harm to the child from an abduction, the legal and practical difficulties of returning the child to the jurisdiction if abducted, and the reasons for the potential abduction, including evidence of domestic violence, stalking, or child abuse or neglect.

Permits an abduction prevention order to include one or more the following: (1) travel restrictions; (2) restrictions on respondent’s ability to remove the child from the United States, the State, or other locations; (3) requiring the respondent to register the abduction prevention order in another state in order to allow the child to travel to that state; (4) passport restrictions or registration requirements; (5) prerequisites to existing custody or visitation rights including, registration of the order with the US State Department with proof to the court and/or registration of the order with the U.S. embassy or other diplomatic presence in the destination country; and (6) upon the petitioner's request, require respondent to get and order from the relevant foreign country containing identical terms to the US custody determination. Allows the court to limit existing custody or visitation rights, including ordering supervised visitation or posting of bond or other security. Provides for special measures if the court must prevent imminent abduction of a child, including issuing an ex parte warrant to take physical custody of child or authorizing law enforcement to take any action reasonably necessary to locate the child or obtain return of the child under an order issued under the Article. Specifies that the remedies are cumulative and do not affect the availability of other remedies to prevent abduction.

Authorizes the court to order law enforcement officers to take physical custody of the child as part of an ex parte warrant, including by force at any hour if an exigency exists, if the court finds that less intrusive measures will not be effective. Provides for service and an opportunity for respondent to be heard upon the execution of an ex parte warrants. Details required contents of ex parte warrant. Provides for jurisdictional rules and rules of construction. Provides remedy of costs and reasonable attorneys’ fees if court finds that petition sought an ex parte warrant for purpose of harassment or in bad faith.

Provides for duration of order. Requires the Revisor of Statutes to cause to be printed, as annotations to the published General Statutes, all relevant portions of the Official Comments to the Uniform Child Abduction Prevention Act and all explanatory comments of the drafters of this act as the Revisor may deem appropriate.

Specifies that GS 50A-110 (pertaining to communication between courts), GS 50A-111 (pertaining to taking testimony in another state), and GS 50A-112 (pertaining to preservation of records) under the Uniform Child-Custody Jurisdiction and Enforcement Act, apply to new Article 4.

Specifies that new Article 4 modifies, limits, and supersedes the federal Electronic Signatures in Global and National Commerce Act, but does not modify, limit, or supersede Section 101(c) of the act (pertaining to consumer disclosures), or authorize electronic delivery of any of the notices described in Section 103(b) of that the act (pertaining to specific exceptions under the act).

Effective October 1, 2025, and applies to petitions filed or motions made on or after that date.

Part V.

Amends GS Chapter 48, Article 3, to create a new Part 2A adopting the Information and Guidance Provisions of the Uniform Unregulated Child Custody Transfer Act. Limits the scope of the Part to placement for adoption of a minor to whom any of the following applies: (1) has been or is in foster or institutional care; (2) previously has been adopted in a state; (3) has been or is being adopted under the law of a foreign country; (4) has come or is coming to a state from a foreign country to be adopted; (5) is not a US citizen. Requires adoption agencies, within a reasonable time before placing a minor for adoption with a prospective adoptive parent, to provide the prospective adopted with information addressing: (1) possible physical, mental, emotional, and behavioral issues concerning identity, loss, and trauma that a minor might experience before, during, or after adoption, and a minor leaving familiar ties and surroundings; (2) the effect that access to resources, including health insurance, may have on the ability of an adoptive parent to meet the needs of a minor; (3) causes of disruption of an adoptive placement or dissolution of an adoption and resources available to help avoid disruption or dissolution; and (4) criminal prohibitions under GS 14-321.2 (prohibiting the unlawful transfer of custody of minor child).

Requires adoption agencies to provide general adoption information and non-identifying information, as specified, about the minor to potential adoptive parents prior to their decision to adopt. Mandates that adoption agencies provide guidance and instruction for adoptive parents specific to the minor being adopted to help the parents respond to the needs of the adopted minor.

Requires the adoption agency or Department of Health and Human Services (DHHS) to provide information on how to obtain financial assistance and support services upon request from an adopted minor or adoptive parents. Permits DHHS to investigate adoption agencies for compliance with the part’s requirements and to initiate proceedings to enforce the requirements or revoke the license of adoption agencies who do not comply.

Makes clarifying changes to GS 48-3-205.

Includes a severability clause.

Requires the Revisor of Statutes to print the official comments to Article 3 of the Uniform Unregulated Child Custody Transfer Act and the explanatory comments of the drafters.

Applies to the placement of minors for adoption 60 days after the date the act becomes law.

Part VI.

Amends GS 29-30, which allows for a surviving spouse to elect to take a life estate in one third of the value the decedent's real estate instead of the surviving spouse's intestate share or elective share. Adds to the circumstances in which a surviving spouse is not entitled to take a life estate instances in which the surviving spouse has conveyed their interest in the real estate to the other spouse and has expressly waived or released their right to take a life estate in the real estate in the conveying instrument.

Amends GS 39-13.3 regarding real property conveyances between spouses. Adds provisions to specify that a conveyance from one spouse to another of real property or any interest therein does not waive or release the grantor's right to an elective life estate or a right or claim to an equitable distribution with respect to the conveyed property. Allows for express waiver of the right to an elective life estate in the conveying instrument (applicable to conveyances executed before, on, or after October 1, 2025) but does not allow for waiver of a right or claim to equitable distribution in the instrument. Repeals subsection (e), which deems conveyances under the statute subject to GS 52-10 (governing contracts between spouses) and GS 52-10.1 (governing separation agreements), and providing that acknowledgment by the spouse of the grantor is not necessary.  

Amends GS 41-63 regarding events terminating a tenancy by the entirety other than death, of which the conveyance from one spouse to the other of their interest is included as a terminating event. Eliminates the provisions which deem such conveyances subject to GS 52-10 (governing contracts between spouses) and GS 52-10.1 (governing separation agreements), and providing that acknowledgment by the spouse of the grantor is not necessary. Instead, adds new provisions similar to those enacted to GS 39-13.3, to specify that a conveyance does not waive or release the grantor's right to an elective life estate or a right or claim to an equitable distribution with respect to the conveyed property. Allows for express waiver of the right to an elective life estate in the conveying instrument (applicable to conveyances executed before, on, or after October 1, 2025), but does not allow for waiver of a right or claim to equitable distribution in the instrument. Makes technical changes. 

Makes organizational changes to GS 50-20 relating to equitable distribution of marital property. Makes technical and clarifying changes, corrects statutory cross-references, and revises the statute as follows. Modifies the definitions of:  

• distributive award, to more specifically exclude from the term payments for support or maintenance of a spouse or child (was, payments for support and maintenance that are treated as ordinary income to the recipient under the Internal Revenue Code) and 

• marital property, to clarify that the term includes all vested and nonvested pension and retirement rights and benefits and all vested and nonvested deferred compensation rights and benefits. 

Revises the definition of separate property to deem real property acquired by gift from the other spouse as separate property only if that intent is stated in a separate written agreement from the conveyance, while any other property acquired by gift from the other spouse is considered separate property if that intent is stated in writing (previously, generally required intent in the conveyance for any property). Explicitly specifies that the act of conveying property from one spouse to the other does not in itself state intent that the property is to be considered separate property. Additionally specifies that property acquired in exchange for separate property remains separate property absent express intent for the property to be considered marital property in writing (was, in the conveyance), adding that the act of acquiring the property does not in itself state this intent. Regarding written agreements for the distribution of marital property or divisible property, bars providing for distribution in an instrument of conveyance of real property.  

Effective October 1, 2025.  

Part VII.

Repeals GS Chapter 31C, Uniform Disposition of Community Property Rights at Death Act, and enacts new Article 5, Uniform Community Property Disposition at Death Act (Act), to GS Chapter 30. Titles the Article and sets forth 11 defined terms. Provides the following. 

Describes the property of a community-property spouse subject to the Article, with separate criteria for property based on whether the decedent was domiciled in the State at the time of death. Defines community-property spouse as an individual in a marriage or other relationship under which community property could be acquired and which the relationship remains in existence at the time of death of either party to the relationship. Details application to community property acquired by community-property spouses through transfer of property to a trust. Excludes from the Article's scope (1) property that community-property spouses have partitioned or reclassified and (2) property that is the subject of a waiver of rights granted by the Article. 

Permits community-property spouses to partition or reclassify property to which the Article would otherwise apply by a record signed by both spouses, which is presumed to result in each owning a one-half separate property interest in each item in the record. Allows a community-property spouse domiciled in the State to waive a right granted by the Article pursuant to State laws applicable to waiver of a spousal property right. 

Establishes a rebuttable presumption that the Article applies to all property acquired by a community-property spouse when domiciled in a jurisdiction where property acquired by the spouse was presumed to be community property under the law of that jurisdiction. 

Details the disposition of community property at death, with one-half of the applicable property belonging to the surviving community-property spouse and not subject to disposition by the decedent at death. Deems the other one-half of the applicable property to belong to the decedent and subject to disposition by the decedent at death, but not subject to the surviving community-property spouse's rights to an elective share or elective life estate under State law. Excludes property transferred by right of survivorship or under a revocable trust or other nonprobate transfer. Specifies that these provisions do not limit a surviving community-property spouse to the year's allowance under Article 4, GS Chapter 30, or the property exemptions under Article X of the Constitution and Article 16, GS Chapter 1C. Allows a court to require a community-property spouse to elect between retaining other property transferred to the surviving community-property spouse or asserting rights to property that, under the Article, belongs to the surviving community-property spouse that at death the decedent purports to transfer to a third party. 

Describes acts of the surviving community-spouse or decedent that are grounds for the surviving community-spouse or personal representative, heir, or nonprobate transferee can assert a right at the death of a community-property spouse. Details a court's authority to consider community property law and requires applying equitable principles in determining rights and remedies. 

Sets forth the procedure for a surviving community-property spouse to assert a claim for relief under the Article, ranging from commencing a civil action to filing a petition with the clerk of superior court within specified time frames. Specifies that incapacity of the surviving spouse does not toll the time for commencing an action or filing a petition. Authorizes distribution of a decedent's estate without personal liability to the personal representative if no timely demand is made. 

Sets forth the procedure for an heir, devisee, or nonprobate transferee of a deceased community-property spouse to assert a claim for relief under the Article, ranging from commencing a civil action to filing a petition with the clerk of court within specified time frames. Similarly, specifies that incapacity of the heir, devisee, or nonprobate transferee does not toll the time for commencing an action or filing a petition. 

Grants limited immunity for third persons who transact in good faith and for value with either the surviving community-property spouse, personal representative, heir, devisee, or nonprobate transferee so long as the person does not know or have reason to know that the party is exceeding or improperly exercising their authority. Provides for liability of lien creditors and purchasers for value of the property, and priority of a community-property spouse's registered instrument of their intent that the Article apply to the property. 

Provides for the principles of law and equity to supplement the Article. Requires uniform application of the Article. 

Makes conforming changes to GS 28A-2-4 to include claims for relief regarding the disposition of community property at death within the jurisdiction of estate proceedings. Makes technical changes. 

Includes a severability clause and directives for the Revisor of Statutes. Includes a savings clause for property rights acquired, extinguished, or barred on the expiration of a limitation period that began to run under another statute before the effective date of the act. 

Effective January 1, 2026.  

Part VIII.

Subpart VIII-A.

Adds new Article 12, pertaining to Controllable Electronic Records, to GS Chapter 25 (the Uniform Commercial Code). Sets forth eleven defined terms. Specifies that GS Chapter 25, Article 9 (pertaining to secured transactions) prevails if there is a conflict between Article 12 and that article.  

Applies new Article 12 to the acquisition and purchase of rights in a controllable account (defined) or controllable payment intangible (defined) of a purchaser and qualifying purchaser in the same way that the section applies to a controllable electronic record (defined). Sets forth rules to determine whether a purchaser of a controllable account or a controllable payment intangible is a qualifying purchaser. Provides for a shelter principle and purchase of limited interest; the rights of a qualifying purchaser in a controllable electronic record; a limitation of rights of the qualifying purchaser in other property; rules for notice; limitation on filing of an action related to a qualifying purchaser’s purchaser of a controllable electronic record; a general rule for control of a controllable electronic record, including through control of another person; and discharge of an account debtor on a controllable account or controllable payment intangible by paying certain persons.

Provides for rules for governing law, jurisdiction, citation and construction, including consumer laws.

Subpart VIII-B.

Makes technical, clarifying and organizational changes to the definitions set forth in GS 25-9-102 and conforming changes to account for new GS Chapter 25, Article 12 and removal of defined term authenticate. Adds new terms assignee, assignor, beneficiary, control, controllable account, money, electronic money, tangible money, protected purchaser, qualified purchaser. Modifies terms account and chattel paper. Removes defined terms authenticate, electronic chattel paper, send in connection with a record or notification, tangible chattel paper. Adds fourth category of exceptions (writings that evidence chattel paper) to defined term instrument.

Amends GS 25-9-104 (pertaining to control of deposit accounts) to increase the instances that would show that a secured party has control of a deposit account from three to four. Makes technical and conforming changes to account for removal of defined term authenticated.

Amends title of GS 25-9-105 to now pertain to control of electronic copy of record evidencing chattel paper (currently control of electronic chattel paper). Establishes a general rule for purchaser control of that electronic copy, including system requirements for one administrative copy along with one or more administrative copies.  

Creates new GS 25-9-105.1, pertaining to control of electronic money, whether by one person, shared control, or control through another person.

Creates new GS 25-9-107.1 pertaining to control of controllable electronic records, controllable accounts, or controllable payment intangible by secured parties.

Creates new GS 25-9-107.2, establishing instances, including when a person has control under GS 25-9-104 (deposit accounts), GS 25-9-105 (electronic copies of records evidencing chattel paper), or GS 25-9-105.1 (electronic money) where no duty or requirement to acknowledge such control exists.

Amends GS 25-9-203, pertaining to attachment and enforceability of security interests, proceeds, including supporting obligations and formal requisites, as follows. Increases the conditions where a security interest is enforceable to include instances involving chattel paper where the secured party has possession and control pursuant to the debtor’s security agreement. Makes technical and conforming changes to account for changes to defined terms, discussed above and new statutes.

Amends GS 25-9-204 (pertaining to after acquired property) to set forth three instances when the statute does not prevent a security interest from attaching. Makes technical changes.

Amends GS 25-9-208 (additional duties of secured party having control of collateral) to set forth additional duties pertaining to control of: (1) authoritative electronic copies of a record evidencing chattel paper and (2) authoritative electronic copies of an electronic document. Makes technical and conforming changes to account for new statutes and amended definitions. 

Makes technical changes, organizational changes, and conforming changes to GS 25-9-209 (pertaining to the duties of a secured party if the account debtor has been notified of assignment) to account for amended definitions and new statutes.  

Provides that the local law of a bank’s jurisdiction governs perfection and priority of security interests in deposit accounts under GS 25-9-304 (low governing perfection and priority of security interests) even if the transaction does not bear any relation to the bank’s jurisdiction. Makes technical changes. 

Provides that when a local law governs perfection, the effect of perfection or nonperfection, and the priority of a security interest under GS 25-9-305 in uncertified securities, security entitlement or securities accounts, or a commodity contract/account even if the transaction does not bear any relation to the jurisdiction. Makes technical changes.  

Adds new GS 25-9-306.1 (pertaining to the law governing perfection and priority of security interests in chattel paper) and GS 25-9-306.2 (pertaining to the law governing perfection and priority of security interests in controllable accounts, controllable electronic records, and controllable payment intangibles). 

Amends GS 25-9-312 (perfection of security interest in certain types of documents) to set forth a rule of perfection for a security interest in electronic money. Makes technical and conforming changes.

Adds new GS 25-9-314.1 (pertaining to perfection by possession and control of chattel paper).

Amends GS 25-9-316 (effect of change in governing law) to include chattel paper and controllable electronic records in rules governing changes of jurisdiction. Makes technical and conforming changes. 

Amends GS 25-9-317 (interests that take priority over or take free of security interest or agricultural lien) as follows. Sets forth instances when buyers of electronic documents, controllable electronic records, and controllable accounts and controllable payment intangibles take free of a security interest, which trump the statute’s general rule pertaining to when buyers of certain collateral take free of a security interest. Makes technical and conforming changes.

Amends GS 25-9-323 (pertaining to future advances) to remove exceptions for buyers and lessees of goods in the ordinary course of business in instances where those persons take the interest free of a security interest. Makes technical and conforming changes. 

Adds new GS 25-9-326.1 (pertaining to priority of security interest in controllable account, controllable electronic record, and controllable payment intangible).

Amends rules pertaining to purchaser of chattel paper’s priority over (1) a security interest in the chattel paper claimed merely as proceeds of inventory subject to a security interest and (2) a security interest in the chattel paper claimed other than merely as proceeds of inventory subject to a security interest under GS 25-9-330. Makes technical, clarifying, and conforming changes.

Amends rules pertaining to transfer of tangible money, electronic money, and transfers of funds from deposit accounts under GS 25-9-332. Makes technical and conforming changes.

Amends GS 25-9-406 (pertaining to discharge of account debtor; notification of assignment; identification and proof of assignment; restrictions on assignment of accounts, chattel paper, payment intangibles, and promissory notes ineffective) to specify that its sections on (1) discharge of an account debtor, (2) the effect of notification, (3) rules governing when notifications are ineffective, (4) proof of assignment, and (5) provision stating that an account debtor may not waive or vary its option to certain forms of notice asking for less than the full amount of the installment or other periodic payment to assignee, do not apply to a controllable account or controllable payment intangible. Makes technical and conforming changes. 

Specifies that promissory note includes a negotiable instrument that evidences chattel paper in GS 25-9-408 (pertaining to restrictions on assignments of promissory notes, health-care-insurance receivables, and certain general intangibles ineffective).  Makes technical and conforming changes. 

Makes technical, clarifying, and conforming changes to GS 25-9-207 (pertaining to the rights and duties of a secured party having possession or control of collateral); GS 25-9-210 (pertaining to requests for accounting); GS 25-9-301 (law governing perfection and priority of security interests); GS 25-9-310 (pertaining to when filing is required to perfect security interest or agricultural lien); GS 25-9-313 (pertaining to when possession by or delivery to secured party perfects a security interest without filing); GS 25-9-314 (perfection by control); GS 25-9-324 (priority of purchase-money security interests); GS 25-9-331 (priority rights and priority interests); GS 25-9-334 (priority of security interests in fixtures and crops); GS 25-9-341 (pertaining to a bank’s rights and duties with respect to a deposit account); GS 25-9-404 (pertaining to rights acquired by assignee and claims and defenses against an assignee); and GS 25-9-509 (persons entitled to file a record). 

Amends GS 25-9-513 as follows. Requires a demand from a debtor to be signed instead of authenticated.

Amends GS 25-9-601 by adding to the list of statutes under which a secured party in possession of collateral or control of collateral has rights and duties as provided under GS 25-9-207 (rights and duties of secured party having possession or control of collateral).

Amends GS 25-9-605 which sets out when a secured party does not owe a duty based on its status as a secured person, by adding an exception that sets out when a secured party owes a duty. 

Amends GS 25-9-608 to require a demand be signed instead of authenticated.

Amends GS 25-9-611 to require the notification of disposition be signed instead of authenticated.

Amends GS 25-9-613 by modifying the content of the statutory form for “Notification of Disposition of Collateral.” Sets out instructions for completing the form.

Amends GS 25-9-614 by modifying the content of the statutory form for “Notice of Our Plan to Sell Property.” Sets out instructions for completing the form.

Amends GS 25-9-615 to require that a demand for proceeds be signed instead of authenticated.

Amends GS 25-9-616 by amending the definition of “request” so that it applies to records that have been signed instead of authenticated. Amends the options available when a debtor is entitled to a surplus or a consumer obligor is liable for a deficiency, to include requiring the secured party send an explanation after the disposition and before or when the secured party accounts to the debtor and pays any surplus or first makes demand in a record (was, makes written demand) on the consumer obligor after the disposition for payment of the deficiency, or within 14 days after receipt of a request. Changes references to a writing to an explanation.

Requires that transfer statements under GS 25-9-619 be signed instead of authenticated. 

Requires that the following documents under GS 25-9-620 concerning (acceptance of collateral in full or partial satisfactions of obligations) be signed instead of authenticated: (1) notification of objection to the proposal; (2) consent of the secured party of the acceptance of collateral; (3) agreement of the debtor of the terms of the acceptance of collateral in partial satisfaction of the debt signed after default; (4) agreement of the debtor of the terms of the acceptance of collateral in full satisfaction of the debt signed after default when the listed conditions apply.

Amends GS 25-9-621 to require that a notification of a claim of an interest in the collateral be signed instead of authenticated.

Amends GS 25-9-624 to require that a waiver of disposition notification, waiver of mandatory disposition, and waiver of redemption right be signed instead of authenticated.

Amends GS 25-6-628 by adding in an exception to the limitation of liability under the statute.

Subpart VIII-C.

Amends GS 25-1-201, which sets out definitions that apply to GS Chapter 25, by amending the definition of conspicuous, delivery, holder, person, send, and signed. Amends the definition of money so that it excludes from an electronic record that is a medium of exchange recorded and transferable in a system that existed and operated for the medium of exchange before the medium of exchange was authorized or adopted by the government. Adds and defines the term electronic.

Makes conforming changes to account for new Article 12.

Amends GS 25-1-306 to refer to a signed record instead of an authenticated record.

Requires that the Revisor of Statutes redesignate subunits and make any necessary conforming changes in sections of Article 2 and 2A of GS Chapter 25 that are not amended by this act.

Amends GS 25-2-102 by amending the scope of Article 2, Sales.

Adds to the defined terms in GS 25-2-103: contract for sale, and cover.

Amends GS 25-2-106 by adding a definition of the term hybrid transaction.

Amends GS 25-2-201 to refer to a record of a contact instead of a writing. Makes conforming changes to GS 25-2-203, GS 25-2-205, and GS 25-2-209.

Amends GS 25-2-202 to refer to a record, instead of a writing, of a final expression of an agreement between parties.

Amends GS 25-2A-102 by amending the Scope of Article 2A, Leases, to include a hybrid lease.

Amends the definitions for Article 2A under GS 25-2A-103 by adding and defining by cross-reference the terms chattel paper, hybrid lease, and purchase money lease.

Amends GS 25-2A-107 to allow discharge of a claim or right arising out of an alleged default or breach of warranty by a waiver or renunciation in a signed record (was, signed and written) delivered by the aggrieved party. 

Makes changes throughout statutes in Articles 2A and 4A by referring to records instead of writings.

Amends GS 25-3-104 by amending the conditions to be met in order for a promise or order to be considered a negotiable instrument.

Amends GS 25-3-105, concerning issue of instrument, by including as “issue,” if agreed by the payee, the first transmission by the drawer to the payee of an image of an item and information derived from the item that enables the depository bank to collect the item by transferring or presenting under federal law an electronic check.

Amends GS 25-3-401, concerning signatures necessary for liability on an instrument, by removing the ways in which the signature may be made.

Amends GS 25-3-604 by adding that the obligation of a party to pay a check is not discharged solely by destruction of the check in connection with a process in which information is extracted from the check and an image of the check is made and, subsequently, the information and image are transmitted for payment.

Amends the definitions that apply to Article 4A (Funds Transfers) under GS 25-4A-103 by removing from the definition of payment order, one that is submitted electronically.

Amends GS 25-4A-201 to provide that a security procedure may impose an obligation on the receiving bank or the customer and may require the use of algorithms or other codes, identifying words, numbers, symbols, sounds, biometrics, encryption, call-back procedures, or similar security devise. Also provides that requiring a payment order to be sent from a known email address, or telephone number is not by itself a security procedure.

Amends GS 25-4A-202 to require that payment orders be accepted and processed according to the bank’s obligations.

Amends GS 25-4A-210 to allow a payment order to be rejected by the receiving bank by a notice of rejection transmitted to the sender orally or in a record (was, orally, electronically, or in writing).

Amends GS 25-4A-211 to allow a communication of the sender of a payment order cancelling or amending the order to be transmitted orally or in a record (was, orally, electronically, or in writing).

Changes the requirement under GS 25-4A-305(c)and (d) (liability for late or improper execution or failure to execute payment order) that recovery of additional damages must be provided for in an express written agreement of the receiving bank to an express agreement of the receiving bank, evidenced by a record.

Amends GS 25-5-104 to allow a letter of credit, confirmation, advice, transfer, amendment, or cancellation to be issued in any form that is a signed record (was, record that is authenticated by signature or in accordance with the agreement of the parties or the standard practice).

Amends GS 25-5-116, concerning choice of law and forum by adding that a branch of a bank is considered to be located at the address indicated in the branch’s undertaking and specifies how to determine the branch location when more than one address is indicated.

Amends GS 25-7-106, concerning the control of electronic document of title, as follows. Adds requirements to be met in order for a system to have satisfied the statute and a person to have control of an electronic document of title. Also sets out conditions under which a person has exclusive power. Provides that a power of a person is not shared with another person and the person’s power is no exclusive if the specified conditions apply. Gives a person control of an electronic document of title even if another person has control of the document, in specified circumstances.

Amends the definition of terms used in Article 8, Investment Securities, in GS 25-8-102 by adding and defining by cross-reference the terms controllable account, controllable electronic record, and controllable payment intangible.

Amends GS 25-8-103 by adding that a controllable account, controllable electronic record, or controllable payment intangible is not a financial asset unless the following applies: any property that is held by a securities intermediary for another person in a securities account if the securities intermediary has expressly agreed with the other person that the property is to be treated as a financial asset.

Amends GS 25-8-106 by amending the conditions under which a purchaser is considered to have control of a security entitlement. Adds provisions related to a person’s acknowledgment that they have control.

Amends GS 25-8-110 by adding when the local law of the issuer’s jurisdiction or the securities intermediary’s jurisdiction governs a specified matter or transaction.

Makes additional technical and conforming changes.

Subpart VIII-D.

Amends the definitions in GS 44A-40, applicable to Article 4 (Self-Service Storage Facilities) by amending the definition of independent bidder, and owner.

Subpart VIII-E.

Sets out transitional provisions for UCC Amendments, including definitions to be used in Part V.

Provides that unless specified elsewhere, amended GS Chapter 25 Articles 9 and 12 apply to a transaction, lien, or other interest in property, even if the transaction, lien, or interest was entered into, created, or acquired before this act’s effective date.

Provides for the continuing validity of transactions, liens, or interests in property that were entered into, created or transferred before the act’s effective date and that were not previously governed by GS Chapter 25.

Provides that the act does not affect an action, cause, or proceeding commenced before the effective date of this act.

Sets out provisions that apply to security interests that are perfected before the act’s effective date.

Sets out provisions that apply to security interests that are enforceable immediately before the act’s effective date but where unperfected at that time.

Makes an action that is taken before the act’s effective date that would have resulted in perfection of the security interest had the interest become enforceable before the act’s effective date, effective to perfect a security interest that attaches under this act before the adjustment date.

Makes the filing of a financing statement before the act’s effective date effective to perfect a security interest on the act’s effective date to the extent the filing would satisfy the requirements for perfection under this act.

Make the taking of an action before this act’s effective date sufficient for the enforceability of a security interest on the act’s effective date if the action would satisfy the requirements for enforceability under this act.

Sets out provisions governing the determination of priority, established priorities, and the determination of certain priorities on the adjustment date. Also sets out provisions governing the priority of claims when priority rules of Article 9 do not apply.

Subpart VIII-F.

Requires the Revisor of Statutes to print as annotations the published General Statutes all relevant portions of the Official Comments to the Uniform Commercial Code and all explanatory comments of the drafters as deemed appropriate by the Revisor.

Provides that the act becomes effective October 1, 2025.

Makes additional organizational, technical and clarifying changes throughout the act.

Part IX.

Enacts GS Chapter 54D, the Uniform Special Deposits Act (Act), which applies to a special deposit under an account agreement that states the intention of the parties to establish a special deposit governed by the Act, regardless of whether a party to the account agreement or a transaction related to the special deposit, or the special deposit itself, has a reasonable relation to the State. Deems a deposit a special deposit under GS 54D-5 if the deposit meets the following five criteria:

1. The deposit is a deposit of funds in a bank under an account agreement.
2. The deposit is for the benefit of at least two beneficiaries, one or more of which may be a depositor.
3. The deposit is denominated in a medium of exchange that is currently authorized or adopted by a domestic or foreign government.
4. The deposit is for a permissible purpose stated in the account agreement.
5. The deposit is subject to a contingency.

Allows the parties to an agreement to choose a forum in the State for settling a dispute arising out of the special deposit, regardless of either the parties’ or the transaction’s connection to the State, in GS 54D-3. Clarifies that the Act does not affect either: (1) a right or obligation relating to a deposit other than a special deposit or (2) the voidability of a deposit or transfer that is fraudulent or voidable under other law. Defines fourteen terms. Prevents a provision in an account agreement or other record that substantially excuses liability or substantially limits remedies for failure to perform an obligation under the Act from varying the effect of a provision of the Act in GS 54D-4. Provides circumstances when the bank and depositor may amend an account agreement, both with and without the beneficiary’s consent. Requires, in GS 54D-6, for a special deposit to serve at least one permissible purpose stated in the account agreement. Permits a bank to terminate the special deposit, or any other action it deems necessary if it determines that the special deposit no longer serves at least one permissible purpose before termination of the special deposit. Specifies that GS 54-8 through GS 54D-11 will cease to apply if a bank or court determine that a special deposit no longer serves at least one permissible purpose before termination of the special deposit. Provides for elections for the beneficiary if there are insufficient funds to pay the special deposit, in GS 54D-7.

Specifies, in GS 54D-8, that: (1) neither a depositor nor a beneficiary has a property interest in a special deposit and (2) any property interest is only in the right to receive payment if the bank is obligated to pay a beneficiary and not in the special deposit itself. Provided the three listed criteria are met, specifies that creditor process with respect to a special deposit is enforceable against the bank holding the deposit, in GS 54D-9. Provides for injunctive relief in GS 54D-10 and recoupment or set off in GS 54D-11. Lists seven duties and liabilities of a bank in relation to a special deposit including: (1) clarifying that a bank does not have a fiduciary duty to any person with respect to a special deposit; (2) when the bank holding a special deposit becomes obligated to pay a beneficiary, a debtor-creditor relationship arises between the bank and beneficiary; (2) what damages may be owed if the bank does not comply with the account agreement; and (4) unless the account agreement provides otherwise, the bank is not required to determine whether a permissible purpose stated in the agreement continues to exist. Provides for terms and five-year termination as specified, of a special deposit, in GS 54D-13. Provides for principles of law to supplement the Act unless inconsistent with its provisions. Directs courts to consider the promotion of uniformity of law among jurisdictions that enact the Act in construing the provisions of the Act. Directs the Revisor to cause to be printed, as annotations to the published General Statutes, all relevant portions of the Official Comments to the Uniform Special Deposits Act and all explanatory comments of the drafters as the Revisor may deem appropriate.

Effective October 1, 2025, and applies to a special deposit made under an account agreement executed on or after that date.