The leadership of the Institute and that of the National Conference of Commissioners on Uniform State Laws have agreed that uniform rules for computer-information transactions will not, as previously intended, be jointly promulgated as a new Article 2B of the Uniform Commercial Code. Instead, NCCUSL has independently decided to promulgate these provisions as a separate Uniform Act, which will be known as the Uniform Computer Information Transactions Act (UCITA).

Although NCCUSL’s leadership planned to complete the Conference’s review of the proposed UCC Article 2B this year, the Council of the Institute continued to have significant reservations about both some of its key substantive provisions and its overall clarity and coherence. As a result, even though 2B had already been before the membership in 1997 and 1998, it was scheduled once again only for discussion at the 1999 Annual Meeting rather than for a final vote. The earliest that the Institute might have approved the Article as part of the UCC, therefore, would have been May of 2000. NCCUSL, however, believing that the proposed statute is currently ready to provide a viable legal framework for the evolution of sound business practices in computer-information transactions, will now be in a position to target UCITA this fall for introduction and enactment in the 50 states, the District of Columbia, Puerto Rico, and the United States Virgin Islands. The Institute, meanwhile, which will play no further role in the drafting process, has cut back the three hours previously scheduled in May for discussion of 2B to an hour and a half. This reduced time frame will encompass an informational report and brief discussion of UCITA.

The mutual decision of the two organizations to drop the former Article 2B from the Uniform Commercial Code will not affect the continuing fruitful collaboration of the Institute and the National Conference on the Code. At the 1999 Annual Meeting, the Institute will consider Proposed Final Drafts for both Article 2 (Sales) and 2A (Leases), the latter having just been added to the agenda.