When will the Personal Properties Securities Act 2009 commence?

In my post dated 4 September 2011, I noted that the latest possible date for implementation of the scheme in the legislation is 1 February 2012. 

The Federal government has stated in its latest PPS newsletter that "the PPS Register ... will be publicly available before this time. We recognise the importance of knowing the precise registration commencement time (RCT) and will provide further updates as they are available." (See http://bit.ly/nQom40 ). 

The current newsletter also informs us that the new National PPS enquiries line is now open for business. The National Service Centre is now taking telephone enquiries on 1300 007 777 or 1300 00PPSR.

Stand by for updates, as they become available.

W G Stark 
Hayden Starke Chambers

What effect does the Personal Property Securities Act 2009 have on retention of title clauses?

The Personal Property Securities Act 2009 (Commonwealth) (“the PPSA”) (which is due to commence before February 2012 – see blog dated 5 September 2011) will have an adverse effect on all commercial suppliers who rely on retention of title clauses in their trading terms.

As previously noted, the PPSA sets up a new scheme of registration of security interests in personal property.

The provisions of the Act make it clear that:

• Personal property includes retention of title rights.
• A personal property security is when a secured party takes an interest in personal property as security for any obligation (such as a payment obligation) that involves the supply of secured finance

All suppliers of goods on credit should now:

·        Review their terms of trade with a view to ensuring that they meet the requirements of the PPSA, and

·        Be in a position to register a financing statement (covering their retention of title interest) on the Personal Property Securities Register, when it commences operation. Registration of a financing statement enables a secured party to ‘perfect’ its security interest.

Commercial lawyers in practice in Victoria should already be reviewing their clients’ terms of trade to ensure compliance with the PPSA.

W G Stark  
Hayden Starke Chambers

Timing is everything! Start date for PPSA deferred (again!)

I noted earlier today that the Personal Property Securities Act 2009 (Commonwealth) (“the PPSA”) was expected to commence on 31 October 2011. The start date has today been deferred indefinitely, although the Attorney-General's department noted in its notification that the last possible start date in the legisltation is 1 February 2012. I will keep you posted as the timetable develops!

WG Stark
Hayden Starke Chambers

How does the new Personal Property Securities Act 2009 affect me?

The Personal Property Securities Act 2009 (Commonwealth) (“the PPSA”) is expected to commence on 31 October 2011 (although its commencement has been deferred already at least once because not all jurisdictions were ready in May 2011).

The new regime raises a number of questions – some easily answered, others that are quite complicated.

This first blog on the PPSA will only deal with the basics. Further blogs will deal with more complex questions as the need arises, and as cases provide us with some guidance as to interpretation.

The PPSA sets up a new scheme of registration of security interests in personal property.

The Act provides:

• Personal property is any form of property other than land, buildings or fixtures which form a part of that land. It can include tangibles such as cars, art, machinery and crops; as well as intangibles such as intellectual property and contract rights (including retention of title rights).
• A personal property security is when a secured party takes an interest in personal property as security for a loan or other obligation, or enters into a transaction that involves the supply of secured finance
• For the establishment of a single national online register to replace a number of state securities registers and the ASIC register of charges granted by corporations
• It is not compulsory to register on the PPS Register. However, registration of a financing statement enables a secured party to ‘perfect’ its security interest.
• A perfected security interest will:
• have priority over an ‘unperfected’ security interest
• survive the grantor’s insolvency/bankruptcy, as an unperfected security interest will not; and
• in some cases survive the sale of the collateral, as an unperfected security interest will not.

The federal government has set up a web site[1] in anticipation of the commencement.

From 31 October 2011, any security interest in personal property should be registered at the Personal Property Securities Register.

The Federal Attorney-General is expected to confirm the commencement of the new regime some time in September 2011.

W G Stark  
Hayden Starke Chambers

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[1] http://www.ppsr.gov.au/