Difference Between Active and Effective UCC Filings | First Corporate Solutions Blog

The Uniform Commercial Code contains many terms and phrases that are esoteric to the commercial lending industry—they have a very specific meaning within the code. The definition can be crucial to your due diligence efforts, so it’s important to know the difference. One instance we’ve come across is the difference between an “active UCC filing” and an “effective UCC filing,” which can affect on your due diligence. First, let’s cover the definitions.

1. Effective Filing: The filing is sufficient to perfect a security interest according to Revised Article 9 standards.

2. Active Filing: The filing is indexed and discoverable within a jurisdiction’s searchable indexes.

For a UCC-1 to be considered an effective filing it must meet the following criteria:

• Filed in the correct jurisdiction
• Not lapsed or terminated
• Conditions of creating a security interest are met
• Minimum filing standards for UCC-1 are followed"

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Difference Between Active and Effective UCC Filings | First Corporate Solutions Blog:

For additional information regarding Florida business sales, acquisitions and valuations, please contact Eric J. Gall at info@buysellflbiz.com or 239.738.6227. Also, visit our Florida Business Exchange website at www.fbxbrokers.com and my personal website at www.buysellflbiz.com.