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Australia – PPSA Review: Report tabled In Parliament.

19 March, 2015

 

Legal News & Analysis – Asia Pacific – Australia – Capital Markets

 

The report for the three-year statutory review of the Personal Property Securities Act 2009 was tabled earlier in Commonwealth Parliament by the Australian Attorney-General, Senator the Hon George Brandis QC.

 

The report makes almost 400 recommendations for improvements to the PPSA. Many of the recommendations in the report are aimed at simplifying the process of making registrations and conducting searches on the PPS Register, including by:

 

  • reducing the number of fields that a registrant needs to complete when making a registration; and
  • reducing the number of collateral classes.

 

Many other recommendations are designed to make the meaning of the PPSA clearer, or to simplify it, either by removing provisions that are of little value, or by simplifying its language.

 

The report also looks in detail at the scope of the PPSA, and in particular at the extent to which the PPSA should apply to deemed security interests. It makes a number of recommendations in relation to each of the three types of deemed security interests: transfers of accounts or chattel paper, commercial consignments and PPS leases. In particular, it proposes that:

 

  • the concept of chattel paper be removed;
  • the concept of an account be clarified and tightened; and
  • the concept of a PPS lease also be tightened, for example by removing both references to bailments, and references to leases for an “indefinite term”.

 

The report also examines the exclusions from the Act, and recommends that a number of the exclusions be eliminated or tightened. The report recommends in particular that the Commonwealth Government engage in discussions with the States to determine whether the PPSA can be amended so that it can apply to statutory licences, water rights and fixtures – categories of property which are currently excluded from the reach of the PPSA.

 

The report is the product of an extensive series of consultations with stakeholders, including two rounds of submissions, an interim report on issues of particular importance to small business, and four consultation papers. In all, the report received 92 submissions, and 83 responses to the consultation papers. This input from stakeholders was instrumental to the formulation of the recommendations in the report.

 

Government will now consider its response to the report. This is likely to take a number of months. Access report at: www.ag.gov.au/ppsareview

 

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For further information, please contact:

 

Bruce Whittaker, Partner, Ashurst

bruce.whittaker@ashurst.com

 

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