Statutory Review of the Personal Properties Securities Act 2009

On 4 April 2014, the Attorney-General announced a review of the Personal Property Securities Act 2009 (PPSA) as required by Section 343 of the Act.

The PPSA provides a single national system for the creation, registration, priority and enforcement of security interests in personal property.   The PPSA commenced on 30 January 2012.

The aim of the reform brought in by the PPSA was to improve the ability of individuals and businesses, particularly small-to-medium size businesses, to use more of their property to secure lending. The reform follows the successful example of other countries – in particular, Canada and New Zealand.

The reform sought to dispense, so far as is possible, with considerations of the form of security interests (such as charges, mortgages and leases). Instead, the PPSA defines a security interest as an interest in property which, in substance, secures payment or performance of an obligation. This has improved the consistency with which security interests are treated by the law.

Terms of Reference

The terms of reference provide that the review should consider:

• The effects of the reforms introduced by the PPSA on: 
  
• Australian businesses, particularly small business;
• Australian consumers;
• the market for business finance in Australia; and
• the market for consumer finance in Australia;
• The level of awareness and understanding of the PPSA at all levels of business, particularly small business;
• The incidence and, where applicable, causes of non-compliance with the requirements of the PPSA particularly among small
  businesses;
• Opportunities for minimising regulatory and administrative burdens, including costs, on businesses, particularly small business,
  and consumers opportunities for further efficiencies in the PPSA regime including (but not limited to) simplification of
  the Personal Property Securities Register and its use;
• The scope and definitions of personal property covered by the PPSA;
• The desirability of specifying thresholds for the operation of the PPSA regime in respect of particular types of personal property the interaction of the PPS Act with other legislation including the Corporations Act 2001 (Cth);  and 
• Any other relevant matters.

Reviewer - Mr Bruce Whittaker

Mr Bruce Whittaker will conduct the review. Mr Whittaker specialises in debt capital markets, acquisition and leveraged finance, project finance, asset finance and leasing, and banking. Mr Whittaker has more than 30 years’ experience in private practice both in Australia and overseas; and is recognised as one of the world’s leading structured finance lawyers.

Next Steps

Submissions on issues particular to small business close on 6 June 2014.

Submissions on all other issues close on 25 July 2014.

An interim report on priority issues raised by small business in the review will be prepared by 31 July 2014. The final report is due on 30 January 2015 and is expected to make recommendations on how to improve the Act, including simplification where appropriate.

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 Media Release - Attorney General

Attorney- General - Statutory review of the Personal Property Securities Act 2009

TimeBase LawOne Draft Bill tracking - Statutory review of the Personal Property Securities Act