The Personal Property Securities Register (PPSR) is an official government register (i.e. a public noticeboard) of registered security interests in personal property.
Personal property can include goods, vehicles, intellectual property (such as copyright, trademarks, patents and design rights), bank accounts, private commercial licences, assigned rights, shares, bonds and other financial property. It excludes land, buildings and fixtures attached to the land.
Established in 2021, the PPSR replaced many state-based registers, such as the ASIC Register of Company Charges, REVS and other vehicle registers, to form one national register.
The PPSR is managed by the Registrar of Personal Property Securities. It is within the Australian Financial Security Authority (AFSA), which is an executive agency under the Attorney General’s portfolio. The Registrar determines what interests can be registered on the PPSR, when the PPSR is not available, and investigates misuse of the PPSR.
Registering interests on the PPSR
Registering an interest on the PPSR lets the world at large know that the registered party claims to have a security interest over the particular property.
A security interest is usually created when a secured party (such as a lender) takes an interest in the personal property of a grantor (such as a borrower), as security for a loan or other obligation. Security interests only arise when there is agreement between the grantor and the secured party. The security interest permits the secured party to take the personal property (collateral) if the secured obligation is not met (e.g. if a loan is not repaid).
Other parties can search the PPSR to determine what security interests (if any) exist over particular items of personal property. It is prudent to search the PPSR when buying property or a business or when extending credit. If someone is facing bankruptcy/insolvency, typically one of the first tasks is to search the PPSR for any registered interests against their personal property. This allows the trustee-in-bankruptcy to determine the order of priority in dealing with secured creditors.
The benefits of PPSR registration in protecting business interests
Registering interests on the PPSR is optional. However, if you have a security interest, you should register that interest on the PPSR to protect your priority as a secured party. Otherwise you risk losing your goods, your interest in the goods, or being left out-of-pocket, if for example the grantor is unable to honour their secured obligation (e.g. to repay an outstanding debt).
The PPSR allows businesses to search the register and readily assess risk before offering finance or extending credit against any personal property, other than land.
If you are considering lending someone money or considering whether to buy a business, contact us to discuss registering property on the PPSR as security for the debt or undertaking a search of the PPSR.