Legislation labelled the Personal Property Securities Act (PPSA) came into effect in Australia on January 30, 2012, and will have an impact on a number of Australian businesses.
The difficulty in easily explaining this area of law and the many types of securities that are affected, mean many Australian businesses are unaware of the potential impact of the legislation. In particular, businesses that have for many years employed a tried and tested way of securing interests in specific personal property could find their system no longer provides proper protection of their interests.
In the past your business may have relied on what were variously called romalpa clauses or Retention of Title Clauses. If that is so you are certainly likely to be affected by the new Act, and need to ensure you understand how the new Personal Property Securities Register works, so as to protect your interests.
Businesses that may be affected include those that are:
- Involved in selling goods on credit and who have previously relied on “Retention of Title” clauses
– Financiers who are seeking clarification of the true assets, security and debt position of a client
– Businesses that lease plant and equipment, vehicles or virtually any other assets
– Companies that provide goods on consignment
– Business owners who are wanting to refinance and need to provide certainty of title in assets
Why do we need it?
While many businesses and advisors were accustomed to the existing system, it became obvious that the previous mix of inconsistent and old-fashioned state-by-state securities arrangements combined with the Corporations Act rules for companies and other Federal rules were inefficient and would work much more effectively for all parties if they were brought under a single unified approach. The result is a detailed, and hopefully all-encompassing, code which draws on the systems that exist in countries such as New Zealand and Canada.
PPSA and its operational Register will cover both individuals and companies. It’s based on the idea that it is in the best interests for anyone dealing with a company or an individual, who may extend credit to that individual or company, to enable them to gain an clear picture of whether apparent assets are in fact owned by that company or individual or only have a registered interest over them.
What should I do?
There are a wide variety of legal and non-legal items available on the web which can help you gain a better idea of whether your business is likely to be affected by the new arrangements. Businesses located in North Queensland, particularly Mackay, should gain advice from a trusted local legal advisor who has experience in commercial and business property matters.
This article is not legal advice and must not be relied on relation to any specific legal situation you may have. You should ALWAYS seek the advice of a qualified lawyer before taking any action in relation to your personal or business legal situation.
Looking for mackay solicitors, lawyers mackay or solicitors mackay ? Need advice about PPSA? Kelly Legal has built a formidable and experienced team of Mackay and Brisbane based lawyers who now offer a range of legal services throughout Queensland in all areas of law.