PPS information sheets

The information sheets listed below explain some of the more complex PPS concepts and, where relevant, refer to the relevant parts of the PPS legislation. All legislation can be found on the ComLaw website. Professional business advisors are the intended audience for these information sheets.

Registration and Priority

The effect of registration upon the priority of security interests is demonstrated through the default priority rules under the Personal Property Securities Act 2009 (Cth). These rules operate on a default basis and are subject to more specific priority rules throughout the PPS Act.

For further and detailed information visit the registration and priority information sheet.

PPS, retention of title (ROT) and leasing 

Under the PPS Act, suppliers who supply goods on retention of title arrangements and lessors will become ‘secured parties’ with a security interest in the collateral, and will have a ‘purchase money security interest’ (PMSI). This is a certain type of security interest which elevates the interest of the secured party to a higher status relative to other interests.

For further and detailed information visit the PPS, ROT and leasing information sheet.

Receivership, administration and liquidation 

The law in respect of receivership, administration and liquidation will not be substantially affected by the PPS Act. The PPS Act does not alter the underlying rights of various parties in cases of receivership, administration or liquidation. In some cases the PPS Act may require that the secured party register their security interest in order to protect their rights.

For further and detailed information visit the receivership, administration and liquidation information sheet.

PPS key concepts

It is important to understand the definitions and new terminology that accompanies the PPS Act and the online PPS Register.

For further and detailed information visit the PPS key concepts information sheet.

Enforcement of security interests

Chapter 4 of the PPS Act contains rights and remedies of enforcement of security interests on the default under a security agreement. Security agreements do not need to include these remedies and may instead rely upon the PPS Act.

For further and detailed information visit the enforcement of security interests information sheet.

PPS Act and floating charges

The PPS Act rules about the creation and nature of security interests do not include concepts analogous to either the ‘floating’ nature of a floating charge or ‘crystallisation’.

For further and detailed information visit the PPS Act and floating charges information sheet.

Transitional provisions

The transitional provisions in the PPS Act are designed to facilitate a seamless changeover from the current law to the PPS Act and explain how this change will affect security interests.

For further and detailed information visit the transitional provisions information sheet.

Purchase Money Security Interests 

A Purchase Money Security Interest (PMSI) is a security interest in collateral that secures the assistance provided by the secured party to the grantor to enable their purchase or acquisition of rights in the collateral. A PMSI is distinguished from a standard security interest in two main ways: its manner of creation, and the priority it receives relative to other security interests in the same collateral.

For further and detailed information visit the purchase money security interests information sheet.

Purchaser protections and the PPS Act

The PPS Act contains purchaser protections which ensure that a purchaser does not innocently buy personal property subject to a security interest. The rules provided identify the circumstances in which certain categories of property may be bought or leased free of a security interest.

For further and detailed information visit the Purchaser protections and the PPS Act information sheet.

Collateral Classes

Registration of a security interest on the PPS Register requires the selection of a general description of the property covered by the registration; this is known as the collateral class. The PPS Register separates the collateral classes under four broad categories each of which contain a number of classes that may be selected.

For further and detailed information visit the collateral classes information sheet.