Debt Collection Tools: Personal Property Securities Register
Hi, my name is Adam Stewart, Debt Collection Expert and owner of Debt Recoveries Australia. This week’s debt collection tool that I want to talk about is the PPSR.
What is the PPSR?
The Personal Property Securities Register (PPSR) established under the Personal Properties Securities Act 2009 (Cth) (“PPS Act”), is a real-time online register of security interests held in personal property. The PPS Register acts as a noticeboard rather than as a definitive record of security interests in personal property.
Secured parties can use the PPSR to register a security interest against personal property. Similarly, consumers or businesses can search the PPSR when they need to know whether certain personal property has a security interest registered against it. Importantly, the PPSR is not a register of title or ownership of personal property.
When a party registers an interest with the PPSR, they “perfect” their security interest. Perfection by registration has two main benefits for a secured party:
1. It defines the priority status the security interest has relative to other security interests in the collateral;
2. It ensures their security survives the any subsequent bankruptcy or insolvency of the grantor.
The Effect of Registration
The PPS Act sets out the default priority rules that apply. They provide that:
- A perfected security interest takes priority over an unperfected security interest
- Priority between two or more perfected security interests is determined in favour of an earlier perfected security interest over a later one, and
- Priority between two or more unperfected security interests is determined in favour of an earlier attached security interest over a later one.
What is “Personal Property”?
Any form of property, other than:
- land; or
- a right or entitlement under a Commonwealth, state or territory law that declares that the right or entitlement is not personal property for the purposes of the PPS Act.
Common examples of personal property include:
- motor vehicles
- caravans and trailers
- plant and machinery
Personal property also includes non-material items such as:
- intellectual property
- investment instruments
How can the PPSR aid in the debt recoveries process?
Generally speaking, a business seeking to protect itself against customer insolvency by taking security over a debtor’s personal property may do so by registering a security interest in such property with the PPSR.
Suppliers, for instance, can use the PPSR to legally secure rights over goods supplied. Not having a registration means the goods supplied are classified as unsecured. A PPS Registration helps you minimize your credit risk.
Debt Recoveries Australia is the expert at recovering your outstanding debts without the drama. For more information, email us at email@example.com or call 1300 799 511. Tell us your problems on Skype at “debtrecoveries”.
FOOTNOTES Personal Properties Securities Act 2009 (Cth), s 55