Government launches Property Security Register

Written on the 2 February 2012 by Macmillans Waller Fry

The Australian Government has this week launched a new initiative to establish a single point of contact register for consumers, businesses and the finance industry.

The Personal Property Securities Register is an online service where consumers and business operators can search a register when they need to know whether certain personal property has a security interest registered against it. The online service also extends to registering new security interests against assets.

The PPS Register will be used in many situations including:

  • Finance companies that provide loans on the basis that they receive a security interest in an item of personal property to register their interest in the property on the PPS Register
  • Business operators who sell personal property on credit, consignment or on a retention of title arrangement to register their interest in the property on the PPS Register, and
  • Consumers who are about to purchase a personal property, such as valuable second-hand goods, to search the register before buying to make sure that the property is free of a security interest.

The following information was obtained from:

Default priority rules

Assets registered on the PPS Register are still subject to the existing priority arrangements during a bankruptcy or liquidation process.

Registration on the PPS Register is a form of perfection under the PPS Act. The most common form of perfection under the PPS Act will be by registration.

Perfection by registration has two main benefits for a secured party. Firstly it defines the priority status the security interest has relative to other security interests in the collateral. Secondly it ensures their security interest survives the bankruptcy or insolvency of the grantor, the person that receives assistance to acquire the collateral.

The effect of registration upon the priority of security interests is demonstrated through the default priority rules under the PPS Act.

These rules provide that:

  • a perfected security interest takes priority over an unperfected security interest
  • priority between two or more perfected security interests is determined in favour of an earlier perfected security interest over a later one, and
  • priority between two or more unperfected security interests is determined in favour of an earlier attached security interest over a later one.

These rules operate on a default basis and are subject to more specific priority rules throughout the PPS Act. For example, there are specific rules that apply to purchase money security interests.

Making a registration

On receiving an application in the approved form, the PPS Registrar may enter a security interest onto the PPS Register.

The application must consist of a financing statement. The financing statement contains the particulars of parties to the transaction, the collateral and the security interest. For certain collateral the grantor’s details will not be entered for privacy reasons.

On the registration of the financing statement the PPS Registrar issues a verification statement to the secured party. The verification statement can be relied upon by the secured party to prove their registration. The secured party must give a notice of the verification statement to the grantor.

A person with an interest in collateral that has had a security interest registered against it may demand the secured party remove the registration if the collateral does not secure an amount owed to the secured party. The secured party may amend or remove the registration. If they do not do so within five business days the person that gave the demand can apply in the approved form to the PPS Registrar and require that the registration be amended or removed. If the secured party disagrees with the demand they may seek a court order that to the effect that the demand was not valid.

Searching the PPS Register

A person may search the PPS Register for details of a registration or security interests registered against a particular grantor.
If the grantor being searched against is an individual rather than a company the search must be for a purpose authorised by the PPS Act. These purposes have been drafted to ensure privacy requirements are complied with. Breach of these authorised search purposes is a civil and criminal offence.

The search certificate will contain details of the parties and the class of collateral the security interest has been registered against.


The fees for registration and search of the PPS Register are determined by the Attorney-General for Australia. Costs are determined on a cost recovery basis. The Australian Government will make no profit from the PPS Register.

Further information

If you would like further information and an in depth assessment as to the potential benefits the new PPS Register could have for your business, please do not hesitate to contact us.

Author: Macmillans Waller Fry




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