The space industry, like all other industries on Earth, will be its most dynamic with good access to credit. Loans, leases, 30 day accounts and all the rest.
Credit is most freely available when the obligation to repay is secured against property. Security interests are created by an agreement where a person can take property if a debt is not paid.
In Australia, the relevant legal rights are set out in the Personal Property Securities Act 2009. At the front of the Act is the Personal Property Securities Register, the PPSR.
The PPSR and registration
The PPSR is a register of security interests in personal property (most things that are not land or buildings). Security interests are created by an agreement where a person can take property if a debt is not paid.
The PPSR is not a register of property ownership. Registering on the PPSR is a way to let people know if personal property such as cars, machinery and space related items have security interests over them. Registering your security interest correctly on the PPSR can protect your security interest and give you extra rights in the property it's registered over. This is especially important if the person who gave you the security interest becomes insolvent.
Examples of security interests ‘in space’
- The retention of title agreements that come with accounts at suppliers
If you supply parts, components or even IP (patents for example) to help with the design and production of satellites, spacecraft or payload and don’t obtain payment straight away – you are a creditor. If you have rights to take things back if they are not paid for, the PPSR is relevant to you.
- Leases of satellite capability, spectrum or other things
Many leases, particularly longer ones, can be counted as security interests. If you are leasing these things to others the PPSR may be relevant to you. It could also be that leases to you, including perhaps for you to access satellite control systems or other functionality, have saleable value of its own. A financier might be interested in taking a security interest over those rights when lending you money.
Learn more and take advantage of the PPSR
The PPSR is about all personal property and the information we provide at ppsr.gov.au is of general applicability. However, we do understand that physically repossessing an orbiting satellite will rarely be an option. It is also true that the laws of space can be difficult to navigate despite international efforts toward standardisation (Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Space Assets).
However, be sure to consider if the PPSR can help you in your space enterprise by improving your access to finance, or by helping you reduce risk if your business means you are a creditor.
This guide provides general information — it does not constitute and is not intended to be legal advice.