Well … a lot. But one that comes across our desks far too often is: “I didn’t realize you need to file a UCC financing statement to perfect an outright sale of accounts receivable.” So as to not bury the lede: you should always file a UCC financing statement to perfect the sale of accounts. Now there is an narrow exception and maybe in a particular transaction there may be an eyes-wide-open reason that someone would choose not to file, but Article 9 of the UCC is clear. So clear in fact that official comment 4 to UCC 9-309 simply says: “Any person who regularly takes assignments of any debtor’s accounts or payment intangibles should file.” I generally recommend staying on-sides with a statue’s drafters.
“Why is this the result?”, you may ask, particularly in connection a whole-receivables true sale or a factoring structured as a true sale. Simple, with respect to perfection and priority, Article 9 treats the sale of “accounts” (and “payment intangibles”) under the same set of rules as would apply to a secured financing involving those types of financial assets. See, for some color, UCC 9-201(37), UCC 9-109(a)(3), official comments 4 and 5 to UCC 9-109 and official comments 2 through 4 to UCC 9-318. All of which serve to reinforce that under the Article 9, the sale of accounts is a “security interest”, the seller is a “debtor“ and the buyer is a “secured party”. In other (less lawyerly) words, perfect the sale of accounts under Article 9 or suffer.
Now this may not be the perfect system, but for intangible assets like account receivables (as compared to the sale of tangible goods), the rule makes a lot of sense. How can I tell if you have sold something that has no physical presence? And how can I be sure that you can’t sell or pledge (with the same priority) an intangible that I have already purchased from you? The UCC provides those answers through the ability to officially record the pledge (or transfer) of interests in many intangible assets and also to provide the ability search those definitive recordings to see whom (if anyone) those intangible assets may have already been pledged (or sold) to. Some more formal thinking on this issue and five other things that every purchaser (and seller) of accounts receivable should know is here – “Six Things Every Purchaser of US Commercial Accounts Receivable Should Know.”