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PERSONAL PROPERTY SECURITIES ACT 2009 - SECT 343

Review of operation of Act

  (1)   The Minister must cause a review of the operation of this Act to be undertaken and completed within 3 years after the registration commencement time.

Note:   For registration commencement time , see section   306.

  (2)   The persons who undertake the review under subsection   (1) must give the Minister a written report of the review.

  (3)   The Minister must cause a copy of the report of the review under subsection   (1) to be tabled in each House of the Parliament within 15 sitting days of the day on which the report is given to the Minister.

Overview

This Act is a law about security interests in personal property.

A security interest is an interest in personal property provided for by a transaction that secures payment or the performance of an obligation. The form of the transaction and the identity of the person who has title to the property do not affect whether an interest is a security interest.

Personal property includes many different kinds of tangible and intangible property, other than real property. Examples include motor vehicles, household goods, business inventory, intellectual property and company shares. Personal property is known as collateral if it is (or is anticipated to be) the subject of a security interest.

A security interest is enforceable against a grantor when it attaches to collateral. A security interest attaches to collateral when a person gives value for acquiring the security interest (or does something else to acquire it), and in return, the person gains rights in the collateral.

A security interest is enforceable against third parties when it has attached to the collateral and either the secured party has possession or control of the collateral, or a security agreement covers the collateral.

If a security interest in collateral is perfected, it takes priority over another security interest that is unperfected when the security interest comes to be enforced. A security interest is perfected if:

  (a)   it has attached to collateral; and

  (b)   it is enforceable against third parties; and

  (c)   certain extra steps (possession or control of the collateral, or registration on the Register of Personal Property Securities) have been taken to protect the interest.

Certain security interests are also declared to be temporarily perfected, or perfected, under this Act.

The secured party whose security interest has the highest priority is entitled to enforce that interest ahead of secured parties with security interests that have a lower priority.

Between perfected security interests, perfection by control has a higher priority than other forms of perfection. The next level of priority is given (subject to certain rules) to perfected purchase money security interests. If no other way of working out priority between perfected interests is provided, the highest priority is given to the security interest that has been continuously perfected for the longest period.

The Register of Personal Property Securities enables secured parties to give notice of actual or prospective security interests. Notice is given by the recording of data about secured parties, grantors and collateral. The register may be kept electronically, for example in a form that is interactive and accessible over the internet.

Summary

Chapter   1 deals with some preliminary matters, including the general application of the Act (Part   1.2) and its interpretation (Part   1.3).

Chapter   2 sets out general rules relating to security interests. These include the following:

  (a)   general principles relating to security agreements, security interests, attachment and perfection (Part   2.2);

  (b)   interpretation provisions about possession and control (Part   2.3);

  (c)   rules about when attachment and perfection of security interests occurs in particular situations (Part   2.4);

  (d)   the circumstances in which personal property is taken free of a security interest in the property (Part   2.5);

  (e)   how to work out the priority between competing security interests (and in some cases, other sorts of interests) in personal property (Part   2.6);

  (f)   rules about the transfer of interests in collateral (Part   2.7).

Chapter   3 contains specific rules about the following:

  (a)   agricultural interests (Part   3.2);

  (b)   security interests in accessions to personal property and their priority (Part   3.3);

  (c)   security interests in personal property that is processed or commingled and their priority (Part   3.4);

  (d)   intellectual property and intellectual property licences (Part   3.5).

Chapter   4 deals with how to enforce a security interest in personal property. Parties can contract out of some of the provisions of Chapter   4.

Chapter   5 provides for the establishment and maintenance of a register with respect to personal property securities and certain prescribed personal property (the Register of Personal Property Securities).

The Registrar of Personal Property Securities is responsible for maintaining the register. Chapter   5 also deals with how the register can be searched, and how certain non - registered data can be provided through the register (as a portal).

A search by reference to the details of an individual grantor must be made for an authorised purpose set out in the Act. A person who carries out an unauthorised search, or uses data from an unauthorised search, may be liable to pay compensation or a civil penalty (or both).

Chapter   6 deals with the role of the courts in proceedings that relate to security interests in personal property. It confers jurisdiction on courts and provides rules for the transfer of proceedings between courts. It also describes the Registrar's role in judicial proceedings and applies Parts   4 and 6 of the Regulatory Powers Act to enable contraventions of civil penalty provisions to be enforced.

Chapter   7 deals with how this Act interacts with foreign laws, the constitutional operation of this Act and the relationship between this Act and other Australian laws.

Chapter   8 deals with the following:

  (a)   rules about the vesting of certain unperfected interests (Part   8.2);

  (b)   rights to damages and compensation in relation to contraventions of this Act (Part   8.3);

  (c)   requests to secured parties for information, how notices may be given and certain other procedural and administrative matters (Parts   8.4 to 8.7).

Chapter   9 deals with the initial application of this Act.

The Act starts to apply under Part   9.3 at the registration commencement time, which is 1   February 2012 (the first day of the month that is 26 months after this Act was given the Royal Assent), or another time determined by the Minister.

Chapter   9 also deals with references to charges and fixed and floating charges in this Act and in security agreements, and provides for the review of the operation of the Act within 3   years after it starts to apply.

Schedule   1 contains application, saving and transitional provisions relating to amendments of this Act.

  (a)   binding the Crown;

  (b)   geographical rules;

  (c)   particular interests to which this Act does not apply.

This Part   is about the terms that are defined in this Act.

Division   2 contains the Dictionary. The Dictionary is a list of every term defined in this Act. A term will either be defined in the Dictionary itself, or in another provision of this Act. If another provision defines the term, the Dictionary will have a signpost to that definition.

Division   3 contains some longer definitions. These include the definition of security interest (in section   12).

A security interest is an interest in personal property provided for by a transaction that secures payment or the performance of an obligation. The form of the transaction and the identity of the person who has title to the property do not affect whether an interest is a security interest. Certain transactions that do not secure payment or the performance of an obligation may also give rise to a security interest: transfers of accounts, consignments and certain long - term leases and bailments (called PPS leases).

This Chapter   sets out general rules relating to security interests in personal property.

Part   2.2 contains some general principles relating to these security interests, the agreements that govern them and their enforceability. The Part   describes how a security interest is attached to personal property and perfected.

Part   2.3 deals with the concepts of possession and control of personal property.

Part   2.4 contains some rules about attachment and perfection of security interests in particular situations.

Part   2.5 sets out circumstances in which a person takes an interest in personal property free of a security interest in the property.

Part   2.6 sets out how to work out the priority between competing security interests (and in some cases, other sorts of interests) in personal property. If a specific rule does not deal with the priority between security interests, then the priority is determined in accordance with the default rules in section   55.

Part   2.7 contains some rules about transferring and assigning interests in collateral.

This Part   sets out some general principles about security interests.

These principles relate to the enforceability of security agreements against grantors of security interests and third parties.

A security interest is only effective if it has attached to collateral. A security interest attaches to collateral when the grantor has rights in the collateral, or can transfer it to the secured party, and value is given, or the security interest otherwise arises.

A security interest is only enforceable against a third party if it has attached to collateral and the secured party possesses the collateral, has perfected the security interest by controlling the collateral or has entered into a written security agreement that describes the collateral.

This Part   also contains rules about how a security interest is perfected and how it is continuously perfected. A perfected security interest has priority over an unperfected security interest, and the security interest that has been continuously perfected for the longest time generally has the highest priority (see Part   2.6 for priority rules).

Perfection occurs when a security interest has attached to collateral and any further steps needed to make the security interest effective against third parties have been taken.

These steps involve registration on the Personal Property Securities Register or possession or control of the collateral. In certain situations this Act provides for perfection, or temporary perfection, by the operation of the Act itself.

This Part   deals with the concepts of possession and control of personal property.

A grantor and secured party cannot both have possession of collateral. There are special rules about possession of the following:

  (a)   goods transported by a common carrier;

  (b)   negotiable instruments not evidenced electronically;

  (c)   chattel paper evidenced electronically;

  (d)   investment instruments evidenced by a certificate.

  (a)   ADI accounts;

  (b)   intermediated securities;

  (c)   investment instruments;

  (d)   letters of credit;

  (e)   negotiable instruments not evidenced by a certificate.

  (a)   a single authoritative copy of the record exists which is unique, identifiable and unalterable (except as set out below); and

  (b)   the authoritative copy identifies the secured party as the transferee of the record; and

  (c)   the authoritative copy is communicated to, and maintained by, the secured party or the secured party's agent; and

  (d)   copies or revisions of the record that change the transferee of the authoritative copy can be made only with the participation of the secured party; and

  (e)   each copy of the authoritative copy (or any copy of such a copy) is readily identifiable as a copy that is not the authoritative copy; and

  (f)   any revision of the authoritative copy is readily identifiable as an authorised or unauthorised copy.

This Part   contains rules about when attachment and perfection (including, in some circumstances, temporary perfection) of security interests occurs in particular situations.

Division   2 deals with security interests in the proceeds of collateral, and in collateral after it is transferred.

Proceeds of collateral are identifiable or traceable personal property that is derived from dealings with the collateral. Proceeds also includes certain insurance or indemnity rights, payments in redemption of certain intangible collateral, certain rights of licensors of intellectual property, and certain rights relating to investment instruments and intermediated securities.

A security interest in collateral continues in the proceeds (except in certain cases). Division   2 also includes some other rules about the perfection of such interests and their enforcement. Special provisions are made for the perfection and temporary perfection of security interests in proceeds, and for the temporary perfection of security interests in collateral after it is transferred.

Division   3 deals with the perfection (and temporary perfection) of security interests in goods that are returned to the grantor or the debtor. After goods are returned for certain dealings (for example, sale or exchange), a security interest in the goods that had previously been perfected otherwise than by registration may be temporarily perfected for 5 business days. The same period of temporary perfection is provided in similar circumstances if possession or control of a negotiable instrument or investment instrument is returned to the grantor or debtor.

If goods are taken free of a security interest, but are repossessed by the grantor or debtor, the security interest reattaches to the goods, and (if the security interest had been perfected by registration) the perfection status of the security interest is unaffected.

Division   3 also provides special rules for the attachment and perfection of a security interest in goods if a sale or lease of the goods creates an account or chattel paper that is transferred to another person.

Division   4 deals with situations where collateral or a grantor of a security interest is relocated from a foreign jurisdiction to Australia. The security interest in the collateral is temporarily perfected if certain conditions are met.

This Part   is about taking personal property free of security interests.

Rules are set out for when personal property may be bought or leased free of a security interest in relation to the following:

  (a)   unperfected security interests;

  (b)   serial number defects;

  (c)   motor vehicles;

  (d)   taking in the ordinary course of business;

  (e)   personal, domestic or household property;

  (f)   currency;

  (g)   taking investment instruments or intermediated securities in the ordinary course of trading;

  (h)   investment instruments;

  (i)   intermediated securities;

  (j)   temporarily perfected security interests.

This Part   deals with how to work out the priority between competing security interests in collateral (and in some cases, other kinds of interests).

Priority rules are relevant when the same personal property is subject to 2 or more security interests. If the debtor defaults, the rules determine the order of priority in which the various secured parties can enforce their security interests under Chapter   4.

Division   2 sets out the default rules that apply if this Act provides no other way of determining that priority.

Unless otherwise provided:

  (a)   perfected interests have priority over unperfected interests; and

  (b)   priority between perfected interests amongst themselves, and unperfected interests amongst themselves, is determined on a first - in - time basis.

The Division   contains other rules of general application (such as the priority that applies to the proceeds of collateral). Security interests perfected by control have the highest priority.

For example, a security interest held by an ADI in an ADI account with the ADI has priority over any other security interest in the ADI account. An ADI has control over an ADI account held with the ADI (see section   25). Only the ADI with which an ADI account is held may perfect a security interest in the ADI account by control (see section   21). A security interest perfected by control has priority over any other security interest in the same collateral (see section   57).

Division   3 deals with the priority rules that apply when one of the security interests is a perfected purchase money security interest. These interests are exceptions to the first - in - time rule (except for certain security interests in an account dealt with in section   64). A perfected purchase money security interest that is granted to a seller, lessor or consignor takes priority over a perfected purchase money security interest that is granted to others.

Division   4 deals with priority of security interests in transferred collateral where a transferor and a transferee have both granted security interests in the transferred collateral. Provided the transferor - granted security interest has remained perfected, that security interest will take priority.

Division   5 deals with the priority of certain creditors who have their debts repaid. The priority of those who purchase negotiable instruments, chattel paper and negotiable documents of title is also dealt with. Generally, the purchaser's interest will take priority over a security interest in the negotiable instrument, chattel paper or negotiable document of title.

Division   6 deals with priorities in relation to the following:

  (a)   interests that arise under law;

  (b)   interests of execution creditors;

  (c)   security interests in returned goods;

  (d)   security interests in accounts, financial property or intermediated securities if a foreign law governs their perfection but does not provide for public registration.

This Part   deals with the transfer of interests in collateral.

Collateral may be transferred despite a contrary provision in a security agreement (or a provision declaring the transfer to be a default), if the grantor and transferee consent, or by the operation of law.

The rights of a transferee of an account or chattel paper are subject to the contract between the account debtor and the transferor, and certain general law claims the account debtor may have against the transferor.

A modification of the contract (or a substituted contract) between the account debtor and the transferor is effective against the transferee except in certain situations (dishonesty, commercial unreasonableness or adverse effects on the transferee's rights or the transferor's ability to perform the contract).

A term in a contract between an account debtor and a transferor that imposes certain restrictions on the transfer of an account or chattel paper binds the transferor to the extent of making the transferor liable in damages for breach of contract, but is unenforceable against third parties.

This Chapter   contains specific rules for certain security interests.

Part   3.2 contains some specific rules relating to agricultural interests (such as security interests in crops and livestock).

Part   3.3 deals with security interests in accessions to personal property.

Part   3.4 deals with security interests in personal property that loses its identity by being processed or commingled.

Part   3.5 deals with security interests in intellectual property.

  (a)   the relationship between a security interest in crops and interests in the land on which the crops are growing; and

  (b)   the capacity for a security interest to attach to crops while they are growing, and to the products of livestock, before the crops or products become proceeds (for example, the wool on a sheep's back before it is shorn); and

  (c)   the priority to be given to security interests in crops (and proceeds) granted to enable the crops to be produced, and security interests in livestock (and proceeds) granted to enable the livestock to be fed and developed.

This Part   deals with security interests in accessions to personal property.

A security interest in goods that become an accession to other goods continues in the accession.

The Part   sets out the priority between an interest (whether or not a security interest) in an accession and the goods to which the accession is affixed.

A security interest arising in an accession before it is affixed to goods has priority over a security interest in the goods as a whole. However, there are exceptions relating to interests in the whole created after the accession is affixed and before the security interest in the accession is perfected.

A security interest arising in an accession after it is affixed will ordinarily be subordinate to an existing interest in the other goods (unless, for example, the holder of the existing interest agrees otherwise) and to a later interest in the other goods that arises before the interest in the accession is perfected.

The Part   also deals with the removal of accessions by a secured party who has an interest in the accession.

This Part   deals with security interests in goods that become an unidentifiable part of a larger product or mass.

A security interest in the original goods continues in the product or mass. The Part   sets out perfection and priority rules that apply in this situation.

This Part   includes some rules with a particular application to security interests in intellectual property and intellectual property licences.

If the exercise of rights by a secured party in relation to goods necessarily involves the exercise of intellectual property rights covered by the security interest, this Act applies to the intellectual property rights in the same way as it applies to the goods.

The Part   also deals with a transfer of intellectual property that is the subject of a licence (or sub - licence) in which a security interest is granted. The security agreement binds the successors in title to the licensor or sub - licensor.

This Chapter   deals with how to enforce a security interest in personal property. Parties can contract out of some of the provisions of this Chapter.

Security interests in liquid assets can be enforced by giving a notice to the person who owes an amount to the grantor. Other kinds of assets can be seized and disposed of under Part   4.3. A secured party can also retain or purchase the collateral.

Proceeds arising from the disposal of collateral must be distributed in accordance with Part   4.4. That Part   also contains other rules of general application in relation to the enforcement of security interests.

This Part   provides general rules about the rights and remedies available to a party to a security agreement for enforcing a security interest in personal property. The Part   does not apply to certain kinds of security interests.

Important rules include the following:

  (a)   a general standard of honesty and commercial reasonableness is to apply to enforcement actions;

  (b)   parties can contract out of specified provisions of this Chapter;

  (c)   if the same obligation is secured by both personal property and an interest in land, a secured party may decide to enforce the personal property interest in the same way as the interest in the land would be enforced, or to enforce the security interest under this Chapter;

  (d)   rules for the enforcement of security interests in certain liquid assets (accounts, chattel paper and negotiable instruments) by giving notice to specified persons or seizing proceeds;

  (e)   rules relating to the enforcement of security interests in crops and livestock.

This Part   deals with the seizure and disposal or retention of collateral following default by a debtor under a security agreement.

Division   2 contains rules about when and how a secured party may seize collateral.

Division   3 deals with the disposal of collateral by a secured party after seizure of the collateral.

Division   4 deals with the retention of collateral by a secured party after seizure of the collateral.

If a secured party proposes to dispose of, or retain, collateral, the party must give notice to the grantor and any other secured party with a security interest in the collateral that has a higher priority. A notice of disposal may be given in the approved form, while a notice of retention must be given in the approved form.

A person may object if a secured party proposes to enforce a security interest by purchasing or retaining the collateral (see Division   5).

A person exercising or discharging rights, duties and obligations arising under this Part   must act honestly and in a commercially reasonable manner (see section   111).

This Part   contains rules about steps to be taken after a security interest in collateral has been enforced.

These rules deal with the following:

  (a)   the order of distribution of personal property or its proceeds;

  (b)   the transfer of title to collateral;

  (c)   redemption of collateral, or the reinstatement of security agreements, before disposal;

  (d)   when certain enforcement notices are not required.

This Chapter   provides for the establishment and maintenance of a register with respect to personal property securities and certain prescribed personal property.

Part   5.2 deals with the establishment of the register and what it contains.

Registrations consist of financing statements , and are amended by the registration of financing change statements . Part   5.3 deals with the registration of these statements, including the data to be included and the issue of verification statements confirming their registration.

Part   5.4 contains rules about the timing of registrations and when a registration becomes ineffective, including the defects that make a registration ineffective.

Part   5.5 is about accessing the register to search for registered data and third party data.

Part   5.5A is about conditions on access to data through the register. In addition, the Part   enables the provision, through the register (as a portal), of non - registered data about personal property from third parties.

Part   5.6 deals with the amendment of registrations after a demand for amendment is made.

Part   5.7 deals with removal of data from the register and the correction of registration errors.

Part   5.8 provides for fees for registration and searching the register, the review of registration decisions and annual reports.

Part   5.9 establishes the offices of the Registrar of Personal Property Securities and the Deputy Registrar.

This Part   sets up the Personal Property Securities Register.

The Registrar of Personal Property Securities is required to establish and maintain the register, and ensure that it is kept operational. However, the Registrar can refuse access to the register, and suspend its operation, in certain circumstances.

The register contains the following data:

  (a)   data with respect to security interests, and related data;

  (b)   data with respect to personal property prescribed by the regulations.

A person may apply to the Registrar to register a financing statement, or a financing change statement, with respect to a security interest or certain personal property.

A registration may perfect a security interest, which may give the secured party an advantage under this Act in enforcing the interest.

A person must not make an application with respect to a security interest unless the person believes on reasonable grounds that the security interest is, or will be, held by a person stated in the application to be a secured party.

This Part   also deals with verification statements, which verify the registration of financing statements and financing change statements.

The Registrar is responsible for giving verification statements to secured parties, who must give notice of the statements to grantors.

Publication may be used as an alternative to giving verification statements.

This Part   provides for the time at which a description of collateral is registered. The precise timing of a registration may be significant in determining the priority to be given to a security interest in the collateral (see section   55).

This Part   also deals with when a registration is effective and registration defects that may cause it to become ineffective.

A registration is effective from the registration time until the earliest of:

  (a)   the registered end time; or

  (b)   an amendment time; or

  (c)   the time when the registration stops being available for search in the register.

A registration is only ineffective because of a defect if there is a seriously misleading defect in data relating to the registration, or one of a number of particular defects set out in section   165 exists.

If a security interest in certain property becomes unperfected, the secured party may be obliged to take steps to end the effect of the registration.

This Part   is about accessing the register to search for data about personal property.

Anyone may access the register to search the register for data with respect to a security interest or personal property. Searches can only be undertaken by reference to certain criteria, for example the details of a grantor, or a serial number.

A search by reference to an individual grantor's details, and the use of data obtained by a search, is only authorised if the search is undertaken for a purpose stated in this Part.

A civil penalty applies in respect of unauthorised searches, and damages may be available (under section   271). In addition, an unauthorised search may be investigated under the Privacy Act   1988 .

The written search results may be used as evidence in a court or tribunal.

A person may apply to obtain:

  (a)   copies of registered financing statements and verification statements; and

  (b)   reports of certain matters relating to registered data in relation to the person.

Access to registered data and third party data through the register may be provided subject to conditions, including conditions about the subsequent use of the data. Damages may be available (under section   271) in respect of a contravention of conditions of access.

The Registrar may arrange with a third party (prescribed by the regulations) under this Part   for the provision of access to non - registered data, held by the third party, through the register (as a portal).

For example, the Registrar may arrange with a prescribed third party to provide users of the register with data held by the third party that relates to motor vehicles. As a result, third party data concerning a motor vehicle may be provided on a verification statement or search result that relates to that vehicle, whether or not the data is specifically requested.

A person with an interest in collateral may require changes to the registration, by way of an amendment demand given to the secured party.

An amendment demand may be made if:

  (a)   the obligation owed by a debtor to the secured party is not secured by collateral described in the registration; or

  (b)   the particular collateral in which the person has an interest does not secure any obligation owed by a debtor to the secured party.

The Registrar may remove data in certain situations, for example if its retention is contrary to the public interest.

The Registrar may also remove old data, restore removed data and correct errors or omissions made by the Registrar.

This Part   establishes the offices of the Registrar of Personal Property Securities and the Deputy Registrar.

Both are appointed by the Minister and engaged under the Public Service Act 1999 .

The Part   also includes provision for the delegation of the Registrar's powers.

This Chapter   deals with the role of the courts in proceedings that relate to security interests in personal property.

Part   6.2 is about judicial proceedings generally.

Part   6.3 applies Parts   4 and 6 of the Regulatory Powers Act, which deal with proceedings for contravention of a civil penalty provision and enforceable undertakings.

This Part   is about judicial proceedings in a court with respect to matters arising under this Act or in relation to a security agreement or a security interest.

Jurisdiction is conferred on the Federal Court, the Federal Circuit and Family Court of Australia (Division   1), the Federal Circuit and Family Court of Australia (Division   2) and courts of States and Territories. PPS matters can be transferred between courts in accordance with procedures set out in this Part.

The Registrar may intervene in judicial proceedings.

This Part applies Part   4 of the Regulatory Powers Act to enable the Registrar to enforce civil penalty provisions, and Part   6 of the Regulatory Powers Act to enable the Registrar to accept an enforceable undertaking.

On application by the Registrar, a relevant court can order the payment of a civil penalty for a breach of a civil penalty provision.

The Registrar may accept a written undertaking for the payment of a specified amount to the Commonwealth within a specified period. The undertaking is given by a person who has taken action that contravenes a civil penalty provision.

This Chapter   deals with how this Act interacts with other laws.

Part   7.2 deals with the interaction of Australian and foreign laws relating to security interests.

Part   7.3 deals with the constitutional operation of this Act.

Part   7.4 deals with the interaction of this Act with other Commonwealth laws and with State and Territory laws.

This Part   is about how Australian laws interact with foreign laws.

In court proceedings, this Part   describes which law will govern the validity, perfection and effect of perfection or non - perfection of a security interest.

The Commonwealth may provide that a particular law governs a security interest and parties can agree that the law of the Commonwealth governs a security interest.

The rules for determining the governing law in relation to a security interest differ depending on the type of interests.

For example, for a security interest in goods, the question of the governing law may be dependent on the location of the goods. However, for certain intangible property and financial property this will generally be determined by the location of the grantor.

  (a)   this Act operates in any State that has given the Commonwealth power to legislate accordingly for the purposes of paragraph   51(xxxvii) of the Constitution;

  (b)   this Act operates in any State to the extent that other constitutional powers permit its operation;

  (c)   this Act operates in a Territory, and outside Australia, to the extent that it can under the Constitution.

This Part   deals with the interaction of this Act with other Australian laws.

This Act is not intended to exclude or limit the operation of any other law if that other law is capable of operating concurrently with this Act.

If there is an inconsistency between this Act and another law, regulations may be made to resolve the inconsistency.

Other laws prevail over this Act in certain situations, as follows:

  (a)   certain specified Commonwealth laws prevail;

  (b)   other laws may govern security agreements;

  (c)   other laws may include restrictions on acquiring or dealing with personal property or a security interest;

  (d)   State or Territory laws may exclude certain matters from coverage under this Act.

  (a)   the vesting of certain unperfected security interests (Part   8.2);

  (b)   damages and compensation for contraventions of this Act (Part   8.3);

  (c)   the provision of information relating to security interests (Part   8.4);

  (d)   the giving of notices and rules about timing (Part   8.5);

  (e)   the onus of proof in judicial proceedings, and what constitutes knowledge (Part   8.6);

  (f)   approved forms and regulations (Part   8.7).

This Part   provides for the vesting of an unperfected security interest in the grantor in certain circumstances.

In the event of the bankruptcy of an individual grantor, or the winding up or the entry into administration of a body corporate grantor, a secured party's unperfected security interest vests in the grantor. However, some security interests are unaffected by this rule.

Some secured parties are entitled to damages or compensation in relation to the vesting of unperfected interests under this Part.

This Part   enables an interested person to request a secured party who holds a security interest in collateral to provide information about the interest.

This Part   sets out procedural rules for making, and complying with, such requests.

This Part   deals with notices that must be given under this Act, and how those notices must be given.

The Part   also empowers a court to make an order extending a period within which something under this Act must be done.

A reference to time in this Act is a reference to time by legal time in the Australian Capital Territory.

This Part   provides that the onus of proving certain facts lies with the person asserting those facts.

The Part   also defines constructive knowledge and provides specific rules about knowledge requirements relating to bodies corporate and other entities and transfers between persons who have close associations with each other.

This Part   enables the Registrar to approve forms for the purposes of this Act. Broad parameters are set out for what may be required by an approved form, including the way in which the form must be given to another person.

This Part   also empowers the Governor - General to make regulations for this Act.

This Chapter   deals with the way this Act will apply when the positive rules established by this Act begin to operate. It also provides for some other matters that will have less relevance over time (fixed and floating charges, in Part   9.5), or a once - only application (the review in Part   9.6).

Part   9.2 defines key concepts for the Chapter.

Part   9.3 deals with the initial application of this Act. Generally speaking, the Act starts to apply at the registration commencement time, which is 1   February 2012 (the first day of the month that is 26 months after this Act was given the Royal Assent), or another time determined by the Minister.

Part   9.4 contains provisions that relate to transitional security interests. These are interests in existence at the registration commencement time or arising afterwards under security agreements made before the registration commencement time.

This includes rules about the attachment, perfection and priority of transitional security interests.

Part   9.4 also deals with the migration of data from existing Commonwealth, State and Territory registers onto the Personal Property Securities Register.

Part   9.5 contains specific rules relating to fixed and floating charges.

Part   9.6 provides for an independent review of the operation of the Act 3 years after it starts to apply.

  (a)   migration time;

  (b)   registration commencement time;

  (c)   transitional security agreement;

  (d)   transitional security interest.

  (a)   new security agreements;

  (b)   security interests arising after commencement;

  (c)   transitional security agreements and interests;

  (d)   new interests in personal property;

  (e)   prescribed personal property;

  (f)   migrated personal property data from Commonwealth, State and Territory registers.

  (a)   the enforceability of transitional security interests;

  (b)   certain declared statutory interests;

  (c)   intellectual property licences;

  (d)   the enforcement generally of security agreements;

  (e)   the starting time for registrations;

  (f)   governing laws (under Part   7.2);

  (g)   constitutional and non - constitutional interests;

  (h)   charges, and fixed and floating charges.

This Part   deals with the transitional application of this Act.

This Part   applies to transitional security interests, which are security interests provided for by security agreements (transitional security agreements) in force immediately before the registration commencement time. A transitional security interest may arise before, at or after the registration commencement time.

The registration commencement time is 1   February 2012 (the first day of the month that is 26 months after this Act was given the Royal Assent), or another time determined by the Minister.

Division   2 is about the attachment, perfection and priority of transitional security interests. Transitional security interests are declared to be perfected until the end of the month that is 24   months after the registration commencement time, or until they are earlier perfected by other means (for example, by registration).

Division   6 is about the migration of data about personal property from Commonwealth, State and Territory registers onto the Personal Property Securities Register. The Registrar may register migrated data about transitional security interests with effect from the registration commencement time. Such transitional security interests are known as migrated security interests.

Migrated security interests are perfected under Division   2 from immediately before the registration commencement time.

Division   7 provides for preparatory registration with respect to transitional security interests in anticipation of the commencement of the Personal Property Securities Register. Other data may also be registered under this Division   before the registration commencement time.

Transitional security interests that are registered in this way are perfected under Division   2 from immediately before the registration commencement time.

Division   8 provides rules for dealing with defective registrations with respect to transitional security interests. For example, omissions arising from the migration of data onto the Personal Property Securities Register will not automatically render the registration of the data ineffective.

This Part   contains special rules dealing with references to charges and fixed and floating charges in laws of the Commonwealth and in security agreements.

These rules are expected to have less relevance over time, as the scheme provided for by this Act provides an alternative to reliance on those techniques for security interest transactions.

This Part   provides for the review of the operation of the Act within 3 years after it starts to apply.

The Act starts to apply under Part   9.3 at the registration commencement time (26 months after the Act is given the Royal Assent, or another time determined by the Minister).


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