More than three months after the go-live, significant problems
persist with the reliability of the Personal Property Securities
MIGRATED PRE-PPSA REGISTERED SECURITY INTERESTS
The Registrar of the PPSR confirmed early on that a large number
of errors and omissions occurred in the migration of data from ASIC
and State & Territory databases to the PPSR. Work has been
underway for some time to identify and correct those errors and
omissions. It is uncertain when corrections will be completed.
Until then, it will be necessary to perform (and pay for) three
separate searches (by grantor ABN, grantor ACN and grantor name) to
try to identify security interests. However, those searches
cannot at present be relied on completely to identify all security
interests that have been granted and/or registered pending
correction of all migration-related errors and omissions in the
PPSR. We are working with the Registrar, our registration
agents and the PPSR user group to ascertain how greater certainty
can be achieved in the meantime.
POST-PPSA REGISTERED SECURITY INTERESTS
As yet unidentified problems with the registration IT engine are
causing a time lag of uncertain duration between the moment of
registration of security interests on-line and the point at which
those registered security interests become searchable.
Accordingly, searches cannot be relied on completely as
identifying all security interests that have been registered since
30 January 2012. Again, we are working with the Registrar,
our registration agent and the PPSR user group to ascertain how
greater certainty can be achieved until this problem is resolved.
The timing of resolution is unclear.
TRANSITIONAL SECURITY INTERESTS
Secured parties with pre-PPSA interests in personal property
which were registered on registers that were not automatically
migrated (eg IP Australia's registers) have two years to
re-register relevant interests on the PPSR, enjoying certain
interim protections under the PPSA in the meantime. To identify
interests in such property during the transition period, it will
therefore be necessary to continue to search existing registers.
The two year transition period also generally applies to other
interests that previously were not capable of registration (eg
retention of title arrangements). Such interests will only be
searchable once registered on the PPSR. Until then, how to identify
and deal with such interests will need to be assessed case by case
(as in the past given that those interests were not previously
While the use of cash settled equity swaps is an established part of the Australian securities market, their use in recent high profile takeovers in Australia has attracted much attention. In particular, this attention has focused on the use of swaps by bidders or potential bidders in target companies without disclosure.
An AFSL is required if a person carries on a financial services business in Australia, unless an exemption applies.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).