The PPSA register goes live on the 30 January 2012. What is it and how does it affect your business?
What is the PPSA?
The Personal Property Securities Act 2009 (Cth) or the PPSA for short is a legislative initiative designed to create a comprehensive public access register that allows for the registration of security interests in personal property. Prompt registration on the PPSA register is important in order to retain priority over subsequent security interests.
Personal Property refers to all property except for real estate, real estate fixtures and statutory licenses. It also includes both registered and unregistered intellectual property.
Security Interest is defined in the PPSA as an interest in property created by a transaction that secures the performance or payment of an obligation.
What happens to existing security interests?
Most security interests which are already registered on various existing registers such as the ASIC Register of Company Charges and REVS will be automatically migrated to the PPSA register. However, security interests over intellectual property registered with IP Australia will not be automatically migrated. Therefore, it is important for you to re-register these interests on the PPSA register.
To facilitate the transition and registration, the PPSA puts in place a 24 month period in which existing security interests are classified as a “Transitional Security Interest” (TSI). During this time TSIs will be protected even if they are not registered on the PPSA register. Despite this temporary protection, we strongly encourage you to register your security interests in intellectual property on the PPSA register as soon as possible.
How should you prepare for the change?
- Determine what security interests you hold;
- Identify interests that are automatically migrated and interests that need to be re-registered;
- Register all interests that are not automatically migrated to the PPSA register as soon as possible, and in any case before the expiration of the TSI period on 30 January 2014; and
- Assess all future transactions to ensure all relevant interests are registered on the PPSA register.
The PPSA significantly reshapes the way security interests are registered and enforced.