Secured parties with a purchase-money security interest (PMSI) in collateral other than inventory now have a longer period to perfect under the Ontario Personal Property Security Act (PPSA).
Former Bill 68 (An Act to promote Ontario as open for business by amending or repealing certain Acts) received Royal Assent on October 25th, 2010. Included in Schedule 5 to the Act are amendments to the PPSA. Among those amendments is an extension of the period within which a secured party with a PMSI in collateral, other than inventory or its proceeds, must perfect its security interest in order to preserve the priority that the PPSA provides for the PMSI. The extension of the period is from 10 to 15 days.
The relevant amendments to the PPSA are as follows:
- Where the collateral subject to the PMSI is an intangible, sections 20(3) and 33(2) now provide that the PMSI must be perfected before or within 15 days after the attachment of the security interest in the intangible.
- Where the collateral is not an intangible, those sections now provide that perfection must occur before or within 15 days after (i) the debtor obtains possession of the collateral, or (ii) a third party, at the request of the debtor, obtains possession of the collateral, whichever is earlier.
- Where the collateral is an accession, section 35(3) now provides that the PMSI be perfected before or within 15 days after the debtor obtains possession of the accession.