The temporary perfection period for transitional security interests under the Personal Property Securities Act (PPSA) expires on 30 January 20141. It is time to take stock and review whether transitional security interests in your favour are effectively registered on the PPSR.
Requirement to register
Security interests in personal property previously registrable under the Corporations Act or other legislation must now generally be registered on the Personal Property Securities Register (PPSR) in order to be fully effective.
Many other interests in personal property not previously regarded as security interests or registrable under any legislation prior to the PPSA are now also regarded as security interests and need to be registered in order to be fully effective. This includes a variety of hiring and bailment arrangements, commercial consignments and transfers of book debts or other receivables.
Pre-PPSA security interests that were registered on pre-PPSA registers, or which were not registrable on those registers, generally benefit from a 2 year temporary perfection period. That period expires on 30 January 2014.
Pre-PPSA security interests that were registered on pre-PPSA registers should generally have been migrated automatically to the PPSR. However, migration is at the risk of the secured party. As there are technical limitations on the effectiveness of a migrated registration it will often be advisable to undertake a new registration in addition to the migrated registration: many secured parties have adopted a practice of re-registering all their security interests.
Pre-PPSA security interests that were not registered on pre-PPSA registers will generally need to be registered under new registrations on the PPSR.
You need to ensure that your organisation has identified all pre-PPSA security interests upon which it may wish to rely and ensure that they are perfected by an effective registration on the PPSR or otherwise.
You need to do this prior to the expiry of the temporary perfection period on 30 January 2014 (that is by no later than 11.59 pm on 29 January 2014).