UCC 9-311 Exception Questions - Equipment Lease Filing Confusion

It's a mix of industrial printing equipment and some automated packaging machinery. The debtor mentioned something about FDA registration for part of it, but I'm not sure if that creates a 9-311 exception or not.

FDA registration typically doesn't create a 9-311 exception. That's more about regulatory compliance than perfection of security interests. You're probably fine with standard UCC-1 filing unless there's actual federal titling involved.

That's helpful - so just because there's federal oversight doesn't automatically trigger the exception?

Exactly. The federal law has to specifically address how security interests are perfected. For most manufacturing equipment, that's not the case.

This distinction trips up a lot of people. I've seen deals delayed because someone assumed federal registration meant UCC exemption.

I haven't heard of that - does it actually check against the federal exemption rules?

Yeah, you just upload your collateral schedule and it runs automated checks. Caught a couple items on our list that might have needed different handling.

All the equipment has manufacturer serial numbers, and some pieces have what look like federal compliance numbers. Does that matter for the analysis?

Compliance numbers are different from titling numbers. If there's no federal title or registration certificate, you're probably dealing with standard UCC filing.

Agreed. The presence of compliance markings doesn't usually create perfection exemptions.

The test is whether federal law provides a complete method for perfecting security interests in that type of collateral. If yes, UCC doesn't apply. If no, use UCC-1.

So it's not just about federal regulation, but specifically about security interest perfection methods?

Exactly right. Federal oversight alone doesn't trigger 9-311.

Equipment deals definitely require more analysis, but the perfection rules aren't that complicated once you understand the framework.

Maybe for you, but I've seen too many deals where someone missed an exception and lost their security interest.

That's reassuring. I was starting to worry I was missing something obvious.

When in doubt, you can always file both ways - UCC-1 for safety and check on federal requirements separately. Better to over-perfect than under-perfect.

That's conservative but smart for high-dollar deals like this one.

How accurate is it? I'm always skeptical of automated legal analysis tools.

It's not giving legal advice, just flagging potential issues for further review. But it caught things we would have missed manually reviewing thousands of items.

Good plan. For a $2.8M deal, the extra verification step is worth it.

You're making the right call. 9-311 exceptions are narrow, and manufacturing equipment rarely qualifies.

Good point. Are the federal procedures generally more complex than UCC?

They vary by system, but they're definitely different. Federal aircraft liens have completely different rules than UCC continuations.

That's why most lenders prefer UCC-eligible collateral when possible - the procedures are standardized across states.