Why search the register?
Why businesses need to search the PPS Register
From 30 January 2012 businesses that acquire assets will need to be aware of any third party security interests that exist in the personal property assets they acquire and ensure that those security interests are discharged.
From 30 January 2012 most security interests in personal property (which is just about any property other than land) will be registered on the Personal Property Securities Register (PPS Register).
Those interested in acquiring an asset will need to search the Register to ensure that the asset is not the subject of an undischarged security interest.
Why is searching important?
The PPS Act, contains rules that determine whether a purchaser or lessee of personal property acquires that property free of any existing security interests.
If you were buying real estate, you (or your lawyer/conveyancer) would ensure that any existing interests on the title were released before completing the purchase. Similarly, in order to ensure clear title to what you are paying for, any registered security interest in personal property will need to be identified and addressed.
For example, a purchaser of “serial numbered property” (at this stage motor vehicles, air and water craft) will acquire the property still subject to the security interest if it is not discharged before the acquisition.
In that situation, the secured party may retain its rights under the PPS Act to recover and realise the property if the seller has breached its obligations to the secured party.
How do you search the PPS Register?
The PPS Register will be accessible online 24 hours a day, 7 days a week. Searches can be made via the government portal, or via a third party provider.
Serial numbered property needs to be searched by entering the serial number. Searchers must ensure that the type of identification number being entered is the correct and most relevant one and that the number they enter is correct. An incorrect number will result in a failed search.
Other property can be searched by the identity of the seller. If the seller is an individual, then the search should be conducted by the person’s full name and date of birth as they appear on the person’s passport. If the seller is a company, then the searcher should enter the company’s ACN or ABN. For added security, the searcher should also conduct searches by the company’s name. But searchers will need to search each possible variant of “Proprietary Limited” (such as Pty. Ltd., Pty Limited and so on) to make sure all possible security interests are revealed.
How do I get more information?
If you would like further information about searching the PPS Register, speak to your usual Maddocks contact or call a member of the Maddocks Personal Property Securities Team.