RSM Australia

Time’s up: why you may need to renew your PPSR registration

Happy 7th anniversary to the Personal Property Securities Register (PPSR)!

It’s officially been seven years since the introduction of the central registry, developed as a result of the Personal Property Securities Act 2009 (PPSA). The PPSR allows you to check if the personal property you wish to purchase, such as a car or boat, has a security interest attached to it.

The registry also makes it easy to undertake searches to see who owns or has a claim over a particular asset (security), helping to avoid nasty disputes in the event of non-payment, bankruptcy or external administration.

Don’t have a registration? Then, unfortunately, your claim over the property may not exist or be valid.

With a first-come-first-served approach to ownership, you must register any property that belongs to you before or immediately after you lease it, finance it, or sell it under invoice or consignment terms.

This includes:

  • cars, motorcycles, caravans, boatsHappy seventh birthday to the PPSR!
  • livestock
  • inventory
  • equipment
  • intangible property
  • financial property

It does not include land or buildings.


What the seven-year anniversary means for you

There are three duration categories to choose from when registering your security interest on the PPSR (which one you choose depends on the type of security you are registering).

If you have an existing registration from back in January 2012, and you chose the 'seven years or less' category, it is likely that your registration has now lapsed or will lapse in the near future. You can check this by logging into your PPSR account. If it has lapsed, and you still have a financial interest in the property, you will need to re-register.

Don’t delay checking the registration of your security, because this could give another person or entity the opportunity to register their name first. Or, if there is a second security registrant against the property, their claim on the property may have already been bumped up to first priority due to the lapsing of your security interest.

If you registered after January 2012, we recommend keeping a calendar reminder to prompt you to extend the registration before it expires. This will prevent the registration from lapsing, and keep your property claim protected.

If you no longer have an interest over the property (no monies are owing and it’s not an ongoing supply of stock arrangement) then we recommend you withdraw your registration.

For help navigating the PPSR, please speak to your lawyer, accountant, or business adviser. An incorrect registration is just as bad as an expired one.


Why registering with the PPSR is so important

If you have an interest in property but have not registered it with the PPSR or your registration has lapsed, you may be at risk of some pretty serious consequences.

Here are two examples that help explain why:

Example 1: You own a commercial property containing expensive equipment, and lease it to a business owner. The business owner goes belly up and the liquidators come in and seize all the assets – including yours.

Example 2: You are a lender, and a borrower asks you for $20,000 to buy a car, with the car as collateral. You lend the money but fail to register on the PPSR, and the borrower also receives finance from another lender, with the same car as collateral. Who gets the car if the borrower can’t pay?

In both examples, a quick and inexpensive registration with the PPSR would be enough to avoid a likely time-consuming and expensive legal process (possibly costing more than the property is worth).


How to register

To protect your assets, you should register them with the PPSR ASAP.

The registration must also be:Happy 7th birthday to the PPSR!

  • accurate (every detail and digit is exact)
  • current (registration has not lapsed)
  • correctly categorised

Any error or omission is likely to result in a void registration, which is the equivalent of not registering at all. 

The required information during registration differs depending on the entity type (individual, company, trust, etc.), and the registration type (motor vehicle, equipment, cash bond, and so on).

Keep in mind that serial numbered goods must be registered with their correct serial number and vehicles with their exact VIN number.


FOR MORE INFORMATION ON THE PPSR

If you need help understanding the PPSR, including re-registrations or extensions, please contact one of our Restructuring and Recovery Specialists.