Property Act All About Security

Posted 30-04-2014
Written by admin 101

The Personal Properties Securities Act 2009 replaced over 70 State and Territorial Acts throughout Australia when it came into force in 2012.

The Act redefined traditional concepts of ownership and priorities in all property except land, and introduced a single national online register of encumbrances over personal property.

Personal property is any form of property other than land/real estate, buildings or fixtures. It can include cars, boats and motor vehicles, art, machinery, crops, intellectual property and in some respects leases.

How does the Personal Properties Security Act apply to your business?

If you have lent money on a secured basis, if you are in the business of supplying goods on credit or you lease equipment, you may have a security interest that is eligible to be registered on the Personal Property Security Register (PPSR).

For example, many businesses would be familiar with the basic retention of title or ROT clauses. These types of clauses commonly seen on Tax Invoices will simply state that legal ownership, or title, to the goods will not pass from the seller to the buyer until the buyer has paid for the goods such as: “The ownership of the material shall remain with the seller, which reserves the right to dispose of the material until payment”.

Prior to the Act suppliers had successfully relied upon retention of title clauses. Those businesses using ROT clauses now need to register their interests on the PPSR to ensure it remains enforceable against other interests. Those businesses that do not register on the PPSR will likely be placed alongside unsecured creditors.

A checklist for all businesses:

  1. New interests: Do you have any unregistered security interests that may now be able to be registered?
  2. Communication: Do you have processes in place to advise customers that you will be registering a security interest?
  3. Terms and conditions: Does your documentation need to be updated? You should consider what changes are required to your terms and conditions to allow registration of security interests.
  4. Correctly register: Each security interest needs to be correctly registered in order to be enforceable and obtain priority over other security interests.

The PPSR has a website ( that provides easy access to conduct searches to see if items that you would like to buy are unencumbered.