PPSA transitional arrangements end on 30 January 2014

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A post from February 2012 considered the Personal Property Securities Act 2009 (Cth) (PPSA) which commenced some 18 months ago.

Today’s post focuses on one of the upcoming critical aspects of the regime.

The PPSA is the national system for personal property securities in Australia and replaced many state, territory and Commonwealth registers of personal property securities.

Central to this system is the Personal Property Securities Register (PPSR) where details of security interests in personal property can be registered and searched.

To give creditors an opportunity to adjust to the new regime, the PPSA included transitional provisions. The principal object of these provisions was to maintain priority between security interests that existed before the PPSA commenced on 30 January 2012 for two years. These interests are known as ‘transitional security interests’.

This two year transitional period ends on 30 January 2014.

To ensure transitional security interests continue to be protected they should be reviewed to ensure they are validly registered on the PPSR by 30 January 2014. There is no PPSR fee to register a transitional security interest.

Until next week.

PPSA and company charges

The long awaited transition to the personal property security regime has continued to evolve since the official ‘live’ date of 30 January 2012.

While there are an ever increasing number of war stories, for anyone involved in advising companies, arguably one of the most tangible changes has been the abolition of ASIC forms in relation to registering company charges.

Today’s post focuses on some of the critical aspects of the new company charge regime.

On 30 January 2012, ASIC ceased to register company charges and ASIC forms 309, 311 and 312 are no longer relevant.

No forms - The difference between the PPS register and the ASIC register of company charges is that there are no physical forms that are lodged with the PPS register. All registrations, amendments and releases are done online using the PPS register (i.e. no forms are signed).

How do I find out if a company has charges against its assets? - ASIC searches will no longer show details of current registered charges. You will need to search the PPS register to reveal these details. As the PPS register search function has experienced a number of technical difficulties, you should always search a company by ACN, ABN and company name until these issues are resolved.

How do I register a security interest? - In order to register a security interest on the PPS register you need to register a financing statement.

How do I release a security interest? - As the ASIC form 312 is no longer relevant, parties will need to agree on a way to document the release in another fashion e.g. a deed of release.

Until next week.