This presentation is designed to create a
better understanding of the Personal Property
Securities Register, or PPSR.
We’ll take a look at what the PPSR is, how
it works, and how it can help business owners,
operators and their advisors.
If you’re in the business of:
• Selling goods on retention of title terms;
• Hiring, renting or leasing out goods for
periods of more than two years;
• Buying or selling valuable second-hand
goods, like machinery or equipment;
• Or, need to raise finance using stock
or other assets as collateral…
Then the PPSR will be of real benefit to you
and your business.
The PPSR is a single, national online database
that operates twenty-four hours a day, seven
days a week.
Replacing more than 35 different state-based
and national registers, the PPSR is like an
online noticeboard, providing details of anyone
claiming an interest against goods or assets.
Since 2012, the PPSR has had more than nine
million registrations and more than fourteen
million searches.
Administered by the Australian Financial Security
Authority, or AFSA, the register can be accessed
online at ppsr.gov.au.
The PPSR covers all kinds of personal property,
which is defined very broadly to include almost
anything of value, with the exception of land,
buildings and fixtures.
Common examples include:
• motor vehicles, planes and boats
• artwork
• livestock and crops
• and equipment.
The register also covers intangible property
– stuff like patents, copyright, bank accounts
and shares.
People looking to buy a second-hand vehicle
make up the largest number of consumer searches
on the PPSR.
$2.00 is a small price to pay to check that
your new set of wheels has no outstanding
debt registered against it.
This video explains a little more about how
that process works…
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When buying a second-hand car, there’s a
lot to think about:
Safety, Fuel Economy, Sporty good looks.
But, like looking under the hood before you
buy, it’s important to check the car’s
history.
If you’re buying from someone who isn’t
a licensed dealer, the car could still have
money owing on it.
If you buy the car and the previous owner
stops paying those debts, your new set of
wheels could be repossessed.
But a search on the Personal Property and
Securities Register will quickly let you know
of any issues.
Searching the PPSR is fast, easy, and gives
you peace of mind when buying second-hand.
For more information on a quick motor vehicle
check, go to PPSR dot GOV dot AU.
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And the register isn’t just for cars.
Searching the register helps you make informed
decisions when buying almost any type of valuable
used goods.
There are two ways to search:
• by serial number, for things like motor
vehicles, boats, tractors and trailers, or
registered intellectual property rights.
• or… by grantor details, using a company’s
ACN or ABN, or an individual’s name and
date-of-birth as it appears on their driver’s
licence.
Search results are generated electronically,
with a search certificate providing names
and contact details of any secured parties
and the date of their registration.
Anyone can search the register, but keep in
mind there are privacy protections that restrict
the use of an individual’s information.
The PPSR also offers business owners and operators
“risk protection”, and it does that in
two major ways:
• when buying goods, the register lets you
check whether those goods are free from existing
finance and safe from repossession;
• when selling goods on retention of title
terms, on consignment, or even as part of
a hire or lease agreement which runs for longer
than 2 years, registration can protect you
if your customers don’t pay or go broke.
To put it simply, by making a registration
you’re showing anyone doing a search that
you’re claiming an interest in the goods
or assets you’re selling.
This video looks at the basic ways businesses
can benefit from using the PPSR.
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The Personal Property Securities Register
- or PPSR - is an online register of security
interests in all personal property in Australia.
Things like machinery, motor vehicles, crops,
livestock… basically anything valuable that
isn’t real estate.
If you’re a business that sells stuff on
credit and have your terms in writing, a PPSR
registration protects your ‘retention of
title’ in those goods until you’ve got
all your money.
In the same way, if you lease goods for more
than two years, your written agreement and
a PPSR registration protects you - the lessor
- in case your customer - the lessee - goes
bust or doesn’t pay.
If you’ve got personal property of value,
the PPSR lets you grant your bank a security
interest in that property so they’ll be
more willing to lend you money.
The bank knows that if you go bust, their
money is still protected because they have
a registered security interest.
For more on how the PPSR can benefit you and
your business, go to PPSR dot GOV dot AU.
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PPSR registration fees start from $6.00 for
any period up to seven years; $25 for up to
twenty-five years; and $115 for an indefinite
period of time.
If you supply the same goods to the same customer
on a regular basis, you may only need to register
once.
That one registration will cover the same
type of collateral for the entire registration
period.
It also helps protect your interest if your
goods are sold on, mixed or installed onto
other goods.
But register your security interest early
– this will give you the best chance of
having priority over other creditors.
When using the register, it helps to understand
some basic terms.
A grantor is someone that grants a security
interest over personal property to another
party.
The grantor can be an individual or an organisation.
Typically, a grantor is a customer or buyer
who receives property under a Retention of
Title arrangement; a lessee who leases personal
property for at least two years or even indefinitely;
a consignee who sells goods on behalf of another
supplier; or a business that uses assets as
security for a loan.
The secured party can be an individual or
an organisation and is typically a seller;
an owner; a lessor or lender; a consignor
who supplies goods to be on-sold; or a financier.
Collateral includes personal property offered
up as security for a debt owed to financiers
or sellers.
Some people think having a contract in place
is sufficient protection when things don’t
quite go as planned.
But that’s no longer the case.
A contract on its own will not protect you,
no matter what it says in the terms and conditions.
You need to register on the PPSR to help protect
your security interest should your customer
get into financial difficulty.
To see if the PPSR is relevant for your business,
use this simple business transaction checklist:
If you’re dealing with valuable goods and
assets such as:
• stock, vehicles, plant, equipment, and
livestock
• but don’t include land, buildings or
fixtures…
… then the PPSR can benefit you.
Likewise, if you have a contract with a customer
for:
• selling on terms (for example, retention
of title)
• leasing or hiring goods for at least two
years
• frequently consigning goods to someone
else to sell on your behalf
• lending money or giving credit, and taking
security for it over a customer’s assets
then once again, the PPSR will be of real
benefit to your business.
Please be aware:
From May 20 2017, the minimum duration of
PPS leases has been extended from more than
one year, to more than two years.
Leases of an indefinite term will not be deemed
to be PPS leases unless and until they run
for a period of more than two years.
This change does not affect agreements entered
into before May 20 2017.
So where can you go for more information?
The PPSR website is a great place to start.
It’s always being refreshed with lots of
great content and is easy to navigate.
The content includes videos which are aimed
at breaking down key elements of the PPSR
in an easy-to-understand format.
Example case studies are constantly being
developed to help break down some of the more
complex issues.
And there’s the free PPSR Business Guide
- a practical plain English guide developed
specifically for business and their financial
advisors.
To download a copy of the guide, or for any
other information about the register, simply
visit the website - ppsr.gov.au.
Well, that’s the end of our presentation.
If you have any feedback or enquiries, you
can send an email to: media@afsa.gov.au
