A. The Code provides that interest with respect to certain obligations may not be exempt from federal income taxation unless they are in registered form. It is therefore a matter of state concern that public entities be authorized to provide for the issuance of obligations in such form. It is a purpose of this act to empower all public entities to establish and maintain a system pursuant to which obligations may be issued in registered form within the meaning of the applicable provisions of the Code. B. Obligations have traditionally been issued in bearer rather than in registered form, and a change from bearer to registered form may affect the relationships, rights and duties of issuers of and the persons that deal with obligations, and by such effect, the costs. Such effects will impact the various issuers and varieties of obligations differently depending on their legal and financial characteristics, their markets and their adaptability to recent and prospective technological and organizational developments. It is therefore a matter of state concern that public entities be provided flexibility in the development of such systems and control over system incidents, so as to accommodate such differing impacts. It is a purpose of this act to empower the establishment and maintenance, and amendment from time to time, of differing systems of registration of obligations, including system incidents, so as to accommodate the differing impacts upon issuers and varieties of obligations. It is further a purpose of this act to authorize systems that will facilitate the prompt and accurate transfer of registered public obligations and developing practices with regard to the registration and transfer of registered public obligations. C. In order that all state and local obligations issued after July 1, 1983, retain their tax exempt status and avoid other penalties, the Legislature of the State of Oklahoma hereby urges and encourages all state and local obligations be in registered form unless: 1. The obligation is not of a type offered to the public; 2. The obligation has a maturity at issue of one (1) year or less; or 3. The obligation is sold only to foreign persons and interest on such obligation is payable only outside the United States and its possessions. These exemptions from registration shall be construed in light of Internal Revenue Code Regulations interpreting 16 U.S.C.A. Section 310(b).
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