Legislation named the Personal Property Securities Act (PPSA) came into being in Australia on January 30, 2012, and may 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 means of securing their interests in specific personal property can find that their system no longer provides proper protection of their interests.
Previously your business might have relied on what were variously called Romalpa Clauses or retention of title clauses. If that’s the case you are most likely to be affected by the new Act, and should ensure you understand how the new Personal Property Securities Register works, to protect your interests.
Businesses that may be impacted include those:
- Involved in selling goods on credit and who have priorly relied on “Retention of Title” clauses
– Financiers seeking clarification of the true assets, security and debt position of a client
– Businesses that lease equipment and plant, vehicles or virtually any other assets
– Companies that provide goods on consignment
– Business owners that are wanting to refinance and need to provide certainty of title in assets
Why do we need it?
Although most businesses and advisors were accustomed to the system as it was, 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 companies and individuals. It is based on the idea that it is in the best interests for anyone dealing with an individual or company, who may extend credit to that company or individual, to enable them to gain an clear picture of whether apparent assets are actually owned by that company or individual or just have a registered interest over them.
What should I do?
There are a large number of legal and non-legal items available online which will help you to gain a clearer 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 business and commercial 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.