ests in order of the date of earliest reg-
istration in a similar manner to dealings
with real property in Australia and with
personal property in other countries with
legislation similar to the PPSA.
With registration at the heart of
the new regime, the PPSA will impact
most businesses. Interests in personal
property that did not require registration
under the old laws (such as rights under
a retention of title clause or leases of
goods) may now be required to register to
maintain the validity and priority of their
rights over such property.
the old Australian State or Common-
wealth registers have been transferred to
the new register. However, not all inter-
ests could be transferred or needed to be
registered before, so there is a 24-month
transition period to register securities
that were created before January 30,
2012 and were not previously required to
be registered.
Interests arising under new contracts
or arrangements since January 30, 2012,
that require registration must be regis-
tered within required time limits, ranging
from 15 to 20 business days depending
on the nature of the interest.
The need to register under the PPSA
is based on the substance of the arrange-
ments rather than the form of docu-
mentation and it seems that "register or
beware" must become the new mantra
of prudent businesses trading in or with
Australia.
tual changes, the PPSA has introduced
a range of new terms. Many of these
terms will be familiar to those already
acquainted with comparable laws in
countries like Canada and New Zealand.
The terms are worth defining in the
important new terms include:
personal property created by a trans-
action that in substance secures the
payment or performance of an obliga-
tion, without regard to the form of the
transaction.
ment or other act, such as a deed of
execution or a declaration of trust, or
writing evidencing the agreement or
act that creates a security interest.
which a security interest is attached.
security interest in personal property
which could be enforced against that
property.
est in the collateral.
a security interest for the person's
own benefit or the benefit of another
person (or both).
ests under the PPSA has clear advan-
tages over the regime that operated under
the confusing quagmire of old statutes.
The complexity of the old system has
been removed and the use of a single
register makes life much easier for
people to register their interests and
conduct searches.
It is now possible for people to trace
the proceeds of their security interests.
For example, if you owned flour and
sold it on condition that ownership only
passes on payment, you would not be
able to maintain any claim over that flour
under the old laws, if the person you
gave it to mixed it with other ingredients
to make a cake.
Under the new laws, you should be
able to maintain your claim over the
value of the flour as a proportion of the
proceeds of any sale of the cake, despite
it becoming part of a cake, provided you
register your interest in the flour against
the purchaser.
trative headache of having to maintain
and use multiple registers, the radical
change in the priority in interests places
new burdens on those who hold security
interests in Australia.
Anyone with such an interest must
now ensure to register under the PPSA or
stand to suffer the harsh consequences of
not registering.
trade with Australia and:
retain legal title (ownership) until
payment; or
the PPS register.
all customers sign up new terms and
conditions with appropriate PPS
provisions.
orders or contracts (even with
existing terms) within the appropriate
time frames.
any security interests over them, as
the new PPS register has a range of
"teething problems." In particular,
take care when searching the regis-
ter as transitional interests have
limited "temporary perfection" for
two years, they may not be registered
immediately on the register and have
superior priority.