Most Read Contributor in Australia, September 2016
The Personal Property Securities Act 2009 (Cth)
(PPSA) two year transition period ends on 31
January 2014. After this date, the 'transitional
protection' given to security interests created before 30
January 2012 (transitional security interests)
will no longer apply. If you fail to perfect a transitional
security interest you risk losing priority to, and/or ownership of,
items of personal property which were covered by those transitional
Do you have a security interest?
A security interest is an interest in personal property such as
motor vehicles, aircraft and livestock (interests in land are
specifically excluded) that secures payment or the performance of
an obligation. Some examples include lease and hire purchase
arrangements, retention of title provisions, certain kinds of
consignment and conditional sale agreements.
What happens if you are not protected?
The consequences of not perfecting your security interest are
potentially significant as:
you risk losing priority in the property to another party with
an interest in the same property; and
your rights may be reduced to those of an unsecured
What should you be doing?
Three practical steps you can take to protect yourself are:
Carry out a review of existing security interests
Where you are relying on transitional protection for interests
such as retention of title provisions or long term leases of
personal property entered into before 30 January 2012, this
transitional protection will cease on 31 January 2014.
We recommend that you carry out a review of your existing
security interests immediately to identify any transitional
security interests which may need to be perfected before the
transition period ends.
Check if pre-existing security interests have been correctly
migrated to the PPS Register
While some transitional security interests, such as those on the
ASIC register of charges, were registered automatically on the PPS
Register as part of the migration process it is possible that some
interests were not migrated correctly.
We also recommend that you check the PPS Register to ensure that
all the security interests that you believe you are entitled to are
registered and that any interests registered are attributable to
you. You can do this by undertaking the 'find and claim'
process. This is a transitional process set up by the Registrar to
allow parties that are properly entered onto the PPS Register with
a Secured Party Group to identify the electronic data that has been
electronically migrated and 'claim' it as their security
You then need to review the particulars contained in each
migrated registration to ensure they are correct and complete. Any
errors on the PPS Register can be corrected as part of this
Perfect any transitional security interests on the PPS Register
by 31 January 2014
In most cases the best way to perfect a security interest is by
registering the security interest on the PPS Register. All PPS
registrations are done online. To register a security interest you
will need to know:
particulars of the grantor;
particulars of the secured party who has been granted the
the description of the property including a serial number if
the class of property;
the nature of the security interest claimed (if the interest is
a purchase money security interest or PMSI);
the end time for registration (how long does the registration
need to last for); and
any other matters prescribed by the regulations.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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