The PPSR & Your Business

Easy come, easy go: The PPSR & your business

31 January 2014 should be seared into the brains of business owners and operators.

When the Personal Property Securities Act (PPSA) came into effect in January 2012, it provided a two year grace period to register security interests on the Personal Property Securities Register (PPSR). The PPSR is a national register of who has security over different forms of property (other than land and buildings). If you sell goods under retention of title or consignment arrangements, if your business hires or leases goods or equipment to others, if you buy or sell used goods, you need to register your security interests by midnight on 31 January 2014 or risk losing that property.

Imagine this… You are in business and have supplied stock to a retailer, you haven’t been paid for the stock but continue to supply to the retailer under normal terms of trade. When the next delivery arrives at the retailer, it can’t be delivered because the store is closed and chained up. Your business hasn’t been paid yet. You sold the goods on a retention of title basis so the stock belongs to you until the retailer pays you, right? The answer is not necessarily. If your security interest in the stock is not on the PPSR, then your rights may not be recognised even if you can prove you have legal title. One business has already learnt this lesson the hard way when they lost the rights to assets they held legal title over because they did not register their security interest on the PPSR but a financier did (see Maiden Civil v QES [2013] NSWSC 852[1]).

The PPSA is one of the most important changes to business in many years. It means that ownership is no longer king if you get into a stouch about who owns what. It’s important to review whether or not your business is affected, and if so, register quickly.

If you are buying assets or entering into agreements, it’s also important to check the register to find out who has a security interest over the property involved.

The PPSR is not just for business. If you are personally buying anything valuable that is second hand, for example a car, you should check the register.

See for more information and to access the PPSR.

If you feel like you need support in making your way through the uncertainties and tough times ahead, or simply have a question or want more information, please contact PJS Accountants on (07) 33903177 or click here to contact us.