In brief - Act before the end of January 2014 to ensure you
maintain your rights to your property
The two year transitional period under the Personal Property
Securities Act 2009 (PPSA) expires at midnight at the end of 31
January 2014. You need to register your security interests in the
Personal Property Securities Register (PPSR) before then.
Registering security interests necessary to retain priority
over other security interests
Transitional rules under the PPSA allowed for security interests
created before 30 January 2012 ("transitional security
interests") to be temporarily perfected, meaning that a
transitional security interest retained the same priority it had at
30 January 2012 against other security interests in the same
collateral perfected after that date.
Some transitional security interests ("migrated
transitional security interests") were able to be registered
prior to 30 January 2012 on the transitional registers - for
example, a fixed and floating charge on the old Register of Company
Charges maintained by the Australian Securities and Investments
If those interests were registered before 30 January 2012, they
were in nearly all cases automatically migrated to the Personal
Property Securities Register (PPSR).
Other transitional security interests which could not be
registered on any transitional register before 30 January 2012
("non-migrated transitional security interests") are
temporarily perfected under the PPSA until midnight on 31 January
What arrangements might create security interests which should
Examples of commercial arrangements entered into before 30
January 2012 where non-migrated transitional security interests
might arise include:
long term contracts such as property development agreements,
licensing agreements, distribution arrangements and joint ventures
containing in substance security interests to ensure performance of
contractual obligations (such as, for example, step-in rights)
charges and mortgages over shares, units in a unit trust or
other personal property (particularly those given by
supply of goods on retention of title terms under long term
standing orders (however described)
long term bailment or warehousing arrangements
long term leasing or hire arrangements such as in relation to
industrial or mining machinery
What happens if you don't register your security interests
on the PPSR?
If you have the benefit of a non-migrated transitional security
interest, you must make sure that you perfect your transitional
security interest (commonly by registration on the PPSR) before
midnight on 31 January 2014.
If you do not perfect your transitional security interest by
midnight on 31 January 2014, other perfected security interests may
take priority over your unperfected transitional security interest
to your detriment, even if your security interest arose first.
Furthermore, your transitional security interest may vest in the
grantor of that security interest if that grantor is wound up or
placed into administration and you will stand in line with all
other unsecured creditors.
What should you do to protect your transitional security
You should ensure that all commercially important transitional
security interests are perfected before midnight on 31 January
2014, by registration on the PPSR or in a way otherwise
contemplated by the PPSA.
If you have the benefit of a transitional security interest
that was registered on a transitional register, you should search
the PPSR to confirm that it has been properly migrated and is
properly registered to you.
A search should also be made of the list of the approximately
6000 charges which were registered at ASIC but not migrated to the
PPSR. If you find a charge granted in your favour on that list, you
will need to register that security interest on the PPSR before
midnight on 31 January 2014.
You should also consider whether you should make additional
registrations in relation to any migrated security interests. For
example, if you hold a security interest over certain personal
property which must or may be registered with reference to its
serial number (such as a valuable patent or trade mark registration
or construction vehicle), then an additional registration should be
made against that serial number on the PPSR.
In the years following the global financial crisis of 2008 many Australian investors lost their life savings as financial products failed and the Australian Stock Exchange shed over 3,000 points.
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