H.B. 1258                                               VETOES

8-729.

(a)     Unless excepted by § 8-728 of this subtitle, a security interest in a vessel is
not valid against creditors of the owner or subsequent transferees or secured parties
of the vessel unless perfected as provided under §§ 8-729 through 8-732 of this
subtitle.

(b)     A security interest is perfected by the delivery to the Department of the
existing certificate of title, if any, and an application for certificate of title on a form
provided or approved by the Department containing information regarding the
security interest, and upon payment of a filing fee of $15. Four dollars of this filing fee
shall be treated as described in § 8-723 of this subtitle. The security interest is
perfected at the time of the delivery and payment.

(c)      If a vessel is already subject to a security interest when the vessel is
brought into the State, the validity of the security interest in the State is to be
determined by the law (including the conflict of law rules) of the jurisdiction where
the vessel was when the security interest attached, subject to the following:

(1)     If the parties to the transaction understood at the time the security
interest attached that the vessel would be kept in the State, and the vessel was
brought into the State within 30 days after the security interest attached for purposes
other than transportation through the State, the validity of the security interest in
the State is to be determined by the law of the State.

(2)     If the security interest was perfected already under the laws of the
jurisdiction where the vessel was when the security interest attached and before
being brought into the State:

(i) If the name of the secured party is shown on an existing
certificate of title issued by that jurisdiction, the security interest continues perfected
in the State.

(ii) If the name of the secured party is not shown on an existing
certificate of title issued by that jurisdiction, and if the law of that jurisdiction does
not provide for certificates of title disclosing security interests, the security interest
continues perfected in the State for 4 months and, after that time, if within the
4-month period the security interest is perfected in the State. This security interest
may also be perfected in the State after the expiration of the 4-month period, in
which case perfection dates from the time of perfection in the State.

(iii) If the security interest was not perfected under the law of the
jurisdiction in which the vessel was when the security interest attached before being
brought into the State, the security interest may be perfected in the State; in which
case perfection dates from the time of perfection in the State.

(d)     (1) Five dollars of this filing fee, which is in lieu of a recordation tax
imposed under Title 12 of the Tax - Property Article, shall be deposited in a special
fund which is created. These moneys shall be used for the benefit of the counties of

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