{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/8.9A-409.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/8.9A-409.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/8.9A-409.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/8.9A-409.html"}],"law_id":75200,"edition_id":1,"section_id":75200,"structure_id":15875,"section_number":"8.9A-409","catch_line":"Restrictions on assignment of letter-of-credit rights ineffective","history":"2000, c. 1007.","full_text":"a\n\nTerm or law restricting assignment generally ineffective. A term in a letter of credit or a rule of law, statute, regulation, custom, or practice applicable to the letter of credit which prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary’s assignment of or creation of a security interest in a letter-of-credit right is ineffective to the extent that the term or rule of law, statute, regulation, custom, or practice:1\n\nwould impair the creation, attachment, or perfection of a security interest in the letter-of-credit right; or2\n\nprovides that the assignment or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the letter-of-credit right.b\n\nLimitation on ineffectiveness under subsection (a). To the extent that a term in a letter of credit is ineffective under subsection (a) but would be effective under law other than this title or a custom or practice applicable to the letter of credit, to the transfer of a right to draw or otherwise demand performance under the letter of credit, or to the assignment of a right to proceeds of the letter of credit, the creation, attachment, or perfection of a security interest in the letter-of-credit right:1\n\nis not enforceable against the applicant, issuer, nominated person, or transferee beneficiary;2\n\nimposes no duties or obligations on the applicant, issuer, nominated person, or transferee beneficiary; and3\n\ndoes not require the applicant, issuer, nominated person, or transferee beneficiary to recognize the security interest, pay or render performance to the secured party, or accept payment or other performance from the secured party.","order_by":null,"text":{"0":{"id":270030,"text":"Term or law restricting assignment generally ineffective. A term in a letter of credit or a rule of law, statute, regulation, custom, or practice applicable to the letter of credit which prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary’s assignment of or creation of a security interest in a letter-of-credit right is ineffective to the extent that the term or rule of law, statute, regulation, custom, or practice:","type":"section","prefixes":["a"],"prefix":"a","entire_prefix":"a","prefix_anchor":"a","level":1,"next_prefix":"a1"},"1":{"id":270031,"text":"would impair the creation, attachment, or perfection of a security interest in the letter-of-credit right; or","type":"section","prefixes":["a","1"],"prefix":"1","entire_prefix":"a1","prefix_anchor":"a1","level":2,"prior_prefix":"a","next_prefix":"a2"},"2":{"id":270032,"text":"provides that the assignment or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the letter-of-credit right.","type":"section","prefixes":["a","2"],"prefix":"2","entire_prefix":"a2","prefix_anchor":"a2","level":2,"prior_prefix":"a1","next_prefix":"b"},"3":{"id":270033,"text":"Limitation on ineffectiveness under subsection (a). To the extent that a term in a letter of credit is ineffective under subsection (a) but would be effective under law other than this title or a custom or practice applicable to the letter of credit, to the transfer of a right to draw or otherwise demand performance under the letter of credit, or to the assignment of a right to proceeds of the letter of credit, the creation, attachment, or perfection of a security interest in the letter-of-credit right:","type":"section","prefixes":["b"],"prefix":"b","entire_prefix":"b","prefix_anchor":"b","level":1,"prior_prefix":"a2","next_prefix":"b1"},"4":{"id":270034,"text":"is not enforceable against the applicant, issuer, nominated person, or transferee beneficiary;","type":"section","prefixes":["b","1"],"prefix":"1","entire_prefix":"b1","prefix_anchor":"b1","level":2,"prior_prefix":"b","next_prefix":"b2"},"5":{"id":270035,"text":"imposes no duties or obligations on the applicant, issuer, nominated person, or transferee beneficiary; and","type":"section","prefixes":["b","2"],"prefix":"2","entire_prefix":"b2","prefix_anchor":"b2","level":2,"prior_prefix":"b1","next_prefix":"b3"},"6":{"id":270036,"text":"does not require the applicant, issuer, nominated person, or transferee beneficiary to recognize the security interest, pay or render performance to the secured party, or accept payment or other performance from the secured party.","type":"section","prefixes":["b","3"],"prefix":"3","entire_prefix":"b3","prefix_anchor":"b3","level":2,"prior_prefix":"b2"}},"ancestry":[{"id":15875,"edition_id":1,"name":"Rights of Third Parties","identifier":"4","label":"part","depth":2,"order_by":1,"parent_id":13277,"metadata":{},"date_created":"2026-06-26 04:00:59","date_modified":"2026-06-26 04:00:59","permalink":{"id":284137,"object_type":"structure","relational_id":15875,"identifier":"4","token":"8.9A\/4","url":"\/8.9A\/4\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13277,"edition_id":1,"name":"Commercial Code \u2014 Secured Transactions","identifier":"8.9A","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:44:33","date_modified":"2026-06-26 03:44:33","permalink":{"id":283833,"object_type":"structure","relational_id":13277,"identifier":"8.9A","token":"8.9A","url":"\/8.9A\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":61383,"structure_id":15875,"section_number":"8.9A-401","catch_line":"Alienability of debtor's rights","url":"\/8.9A-401\/","token":"8.9A\/4\/8.9A-401","metadata":false},{"id":74669,"structure_id":15875,"section_number":"8.9A-402","catch_line":"Secured party not obligated on contract of debtor or in tort","url":"\/8.9A-402\/","token":"8.9A\/4\/8.9A-402","metadata":false},{"id":81896,"structure_id":15875,"section_number":"8.9A-403","catch_line":"Agreement not to assert defenses against assignee","url":"\/8.9A-403\/","token":"8.9A\/4\/8.9A-403","metadata":false},{"id":67314,"structure_id":15875,"section_number":"8.9A-404","catch_line":"Rights acquired by assignee; claims and defenses against assignee","url":"\/8.9A-404\/","token":"8.9A\/4\/8.9A-404","metadata":false},{"id":78678,"structure_id":15875,"section_number":"8.9A-405","catch_line":"Modification of assigned contract","url":"\/8.9A-405\/","token":"8.9A\/4\/8.9A-405","metadata":false},{"id":78910,"structure_id":15875,"section_number":"8.9A-406","catch_line":"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","url":"\/8.9A-406\/","token":"8.9A\/4\/8.9A-406","metadata":false},{"id":86952,"structure_id":15875,"section_number":"8.9A-407","catch_line":"Restrictions on creation or enforcement of security interest in leasehold interest or in lessor's residual interest","url":"\/8.9A-407\/","token":"8.9A\/4\/8.9A-407","metadata":false},{"id":86931,"structure_id":15875,"section_number":"8.9A-408","catch_line":"Restrictions on assignment of promissory notes, health-care-insurance receivables, and certain general intangibles ineffective","url":"\/8.9A-408\/","token":"8.9A\/4\/8.9A-408","metadata":false},{"id":75200,"structure_id":15875,"section_number":"8.9A-409","catch_line":"Restrictions on assignment of letter-of-credit rights ineffective","url":"\/8.9A-409\/","token":"8.9A\/4\/8.9A-409","metadata":false}],"previous_section":{"id":86931,"structure_id":15875,"section_number":"8.9A-408","catch_line":"Restrictions on assignment of promissory notes, health-care-insurance receivables, and certain general intangibles ineffective","url":"\/8.9A-408\/","token":"8.9A\/4\/8.9A-408","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/8.9A-409\/","history_text":"

This law was first created in 2000. The record of its establishment is cataloged in chapter 1007<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year.<\/p>","references":[{"id":61383,"section_number":"8.9A-401","catch_line":"Alienability of debtor's rights","order_by":null,"url":"\/8.9A-401\/"}],"refers_to":false,"permalink":{"id":284171,"object_type":"law","relational_id":75200,"identifier":"8.9A-409","token":"8.9A\/4\/8.9A-409","url":"\/8.9A-409\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/8.9A-409\/","token":"8.9A\/4\/8.9A-409","dublin_core":{"Title":"Restrictions on assignment of letter-of-credit rights ineffective","Type":"Text","Format":"text\/html","Identifier":"\u00a7 8.9A-409","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

a.<\/span> Term or law<\/span> restricting assignment generally ineffective. A term in a letter of credit or a rule of law<\/span>, statute<\/span>, regulation, custom, or practice applicable to the letter of credit which prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary’s assignment of or creation of a security interest in a letter-of-credit right is ineffective to the extent that the term or rule of law<\/span>, statute<\/span>, regulation, custom, or practice: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> would impair the creation, attachment<\/span>, or perfection of a security interest in the letter-of-credit right; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> provides that the assignment or the creation, attachment<\/span>, or perfection of the security interest may give rise to a default<\/span>, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the letter-of-credit right. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

b.<\/span> Limitation on ineffectiveness under subsection (a). To the extent that a term in a letter of credit is ineffective under subsection (a) but would be effective under law<\/span> other than this title or a custom or practice applicable to the letter of credit, to the transfer of a right to draw or otherwise demand performance under the letter of credit, or to the assignment of a right to proceeds of the letter of credit, the creation, attachment<\/span>, or perfection of a security interest in the letter-of-credit right: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> is not enforceable against the applicant, issuer, nominated person, or transferee beneficiary; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> imposes no duties or obligations on the applicant, issuer, nominated person, or transferee beneficiary; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> does not require the applicant, issuer, nominated person, or transferee beneficiary to recognize the security interest, pay or render performance to the secured party<\/span>, or accept payment or other performance from the secured party<\/span>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nRESTRICTIONS ON ASSIGNMENT OF LETTER-OF-CREDIT RIGHTS INEFFECTIVE (\u00a7 8.9A-409)\n\na. Term or law restricting assignment generally ineffective. A term in a letter\nof credit or a rule of law, statute, regulation, custom, or practice applicable\nto the letter of credit which prohibits, restricts, or requires the consent of\nan applicant, issuer, or nominated person to a beneficiary’s assignment of\nor creation of a security interest in a letter-of-credit right is ineffective to\nthe extent that the term or rule of law, statute, regulation, custom, or\npractice:\n\n 1. would impair the creation, attachment, or perfection of a security interest\n in the letter-of-credit right; or\n\n 2. provides that the assignment or the creation, attachment, or perfection of\n the security interest may give rise to a default, breach, right of recoupment,\n claim, defense, termination, right of termination, or remedy under the\n letter-of-credit right.\n\nb. Limitation on ineffectiveness under subsection (a). To the extent that a term\nin a letter of credit is ineffective under subsection (a) but would be effective\nunder law other than this title or a custom or practice applicable to the letter\nof credit, to the transfer of a right to draw or otherwise demand performance\nunder the letter of credit, or to the assignment of a right to proceeds of the\nletter of credit, the creation, attachment, or perfection of a security interest\nin the letter-of-credit right:\n\n 1. is not enforceable against the applicant, issuer, nominated person, or\n transferee beneficiary;\n\n 2. imposes no duties or obligations on the applicant, issuer, nominated\n person, or transferee beneficiary; and\n\n 3. does not require the applicant, issuer, nominated person, or transferee\n beneficiary to recognize the security interest, pay or render performance to\n the secured party, or accept payment or other performance from the secured\n party.\n\nHISTORY: 2000, c. 1007.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}