In assessing the impact of the Personal Property Securities Act you need to understand which of the securities you currently register will be registered in the Personal Property Securities Register and what security interests that are currently unregistered will need to be registered after May 2011 if you wish to maintain priority against competing interests.
What registers will be migrated to the PPS Register?
If you have a security registered on the following registers as at the commencement date (scheduled for May 2011) they will be migrated to the PPS Register and thereafter you will not be able to register new security interests on these registers:
Commonwealth
• Australian Register of Ships
• ASIC – Register of Company Charges (including provisional charges)
• Fisheries Register
New South Wales
• Register of Encumbered Vehicles (REVS NSW)
• Security Interest of Goods Register
• Registers of charges for co-operatives and co-operative housing societies
Queensland
• Register of Encumbered Vehicles (REVS Qld)
• Register of Security Interests and Liens
• Register of Co-operative Charges
South Australia
• Vehicle Securities Register
• Bills of Sale Register, Stock Mortgages and Wool Liens Register and the Liens on Fruit Register
• Register of Co-operative Charges
Tasmania
• Register of Bills of Sale, Stock, Wool and Crop Mortgages and Co-operative Charges
• Register of Vehicle Security Interests
Victoria
• Vehicle Securities Register
• Register of Liens on Crops and Liens on Wool and Stock Mortgages
• Register of Co-operative Charges
Western Australia
• Register of Encumbered Vehicles (REVS WA)
• Bills of Sale Register
Australian Capital Territory
• Register of Encumbered Vehicles (REVS ACT)
• General Register of Deeds and Instruments
• Register of Co-operative Charges
Northern Territory
• Register of Interests in Motor Vehicles and Other Goods
• Bill of Sale, Stock Mortgages and General Register
• Register of Co-operative Charges
You will have 2 years to check that in fact all of your existing securities have been migrated to the new PPS Register.
New securities from May 2011 that would previously have been registered on these securities will have to be registered on the PPS Register.
What security interests that are not currently registered should be registered?
There are a number of new registrable security interests but the one of particular relevance to ADI’s will be a security over a debtor’s deposit with the ADI.
While section 8(1)(d) of the Act excludes any right of set-off or right of combination of accounts from the application of the Act, section 12(4) (meaning of security interest) states that an ADI may take a security interest in an ADI account that is kept with the ADI.
Failure to register the security interest may result in loss of priority in the account as against a competing creditor or an obligation to account to a trustee for the depositor in the event of his insolvency.
