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CLAUSE NOTES
Personal Property Securities (Commonwealth Powers)
Bill 2009
Clause 1: Short Title
Name of the proposed Act
Clause 2: Commencement
Provides that the Bill other than proposed
sections 8(2) and 8(3) commences on the day
on which it receives the Royal Assent.
Proposed sections 8(2) (fixtures) and 8(3)
(water rights) will commence on a day or days
appointed by proclamation when the State is
satisfied that they should be dealt with under
the PPS scheme.
It is possible that water rights will not be
referred for some time and whether coverage
of fixtures will be referred will be determined
after the Australian Law Reform Commission's
examination of the issues
Clause 3: Interpretation
Defines certain terms and expressions used in
the proposed Act, including the following:-
"Commonwealth PPS Act" covers both
the Personal; Property Securities Act 2009 and the
subsequent amendments (two separate
Amendment Acts) to that Act already passed
by the Commonwealth.
"law of the State" is defined to mean any
Act of the Tasmanian Parliament or any
instrument made under such an Act, whenever
enacted or made and as in force from time to
time. The expression is intended to cover both
existing and future Acts and instruments as
enacted, made and amended from time to
time.
"excluded State statutory right" is defined
to mean a right, entitlement or authority that
is granted by or under a law of the State that is
declared by Tasmanian law not to be personal
property for the purposes of the
Commonwealth PPS Act. As a result of the
ambulatory nature of the definition of "law of
the State" the expression will extend to
declarations that are made in relation to both
existing and future State statutory rights.
"express amendment" is defined to mean
the direct amendment of the text of the
Commonwealth PPS Act, but it does not
include the enactment of a provision having
substantive effect otherwise than as part of the
text of that Act. Each of the amendment
references is limited to the express
amendment of the Commonwealth PPS Act.
This means that the matters covered by the
amendment references cannot be the source
of power for other Commonwealth legislation.
"licence" covers a range of rights and
entitlements which the Government might
grant to licence holders the rights conferred
include taxis, mining, fishing, gaming, water and
others. The term licence, however, does not
include any excluded State statutory right (see
above).
"personal property" is defined to mean
property (including a licence) other than land
or an excluded State statutory right. Licences
could be as diverse as taxis and hire cars,
commercial fishing licences and gaming
licences.
Clause 4: Meaning of "referred PPS matter"
Defines the expression "referred PPS
matters" in relation to personal property
that is the subject of the different amendment
references under the proposed Act.
The expression is defined to mean:-
· security interests in personal property;
and
· the recording of security interests, or
information with respect to security
interests, in the personal property in a
register;
· the recording of any other information
with respect to personal property
(whether or not there are any security
interests in the personal property)(this
could include information about stolen
and written off motor vehicles
currently recorded in other registers) ;
· the enforcement of security interests in
the personal property (including
priorities to be given as between
security interests, and as between
security interests and other interests).
The definition, excludes from "referred PPS
matters" any powers that might exclude or
limit the operation State laws to the extent
that the State law makes provision with
respect to:-
· the creation, holding, transfer,
assignment, disposal or forfeiture of a
State statutory right (licences etc); or
· limitations, restrictions or prohibitions
concerning the kinds of interests that
may be created or held in, or the kinds
of persons or bodies that may create
or hold interests in, a State statutory
right; or
· the forfeiture of property or interests in
property (or the disposal of forfeited
property or interests) in connection
with the enforcement of the general
law or any law of the State;
· the transfer, by operation of that law of
the State, of property or interests in
property from any specified person or
body to any other specified person or
body (whether or not for valuable
consideration or a fee or other
reward).
The first and second exclusions from the
referred PPS matters limit the power of the
Commonwealth Parliament to use an
amendment reference to exclude or limit the
power of the State to administer, vary or
abrogate any State statutory rights (such as
licences) that the State creates from time to
time.
This means controls over licences such as how
and to whom they may be transferred etc are
not to be displaced by the Commonwealth PPS
Act should a financier need to enforce a
security interest over the licence.
The third exclusion from the referred PPS
matters is intended, among other things, to
preserve the operation of the laws of the State
that provide for the confiscation of the
proceeds of crimes or for the transfer by or
under a law of the State of assets from defunct
bodies.
Clause 5: Meaning of "security interest" in
personal property
Defines the expression "security interest"
in personal property.
Generally, a security interest in personal
property is an interest created by a transaction
that secures payment or performance of an
obligation (without regard to the form of the
transaction or the identity of the person who
has title to the property) against the property.
The proposed section also provides that a
security interest may encompass certain other
interests provided for by a transaction
regardless of whether or not the transaction
secures payment or performance of an
obligation. An example of such an interest is
an interest of a lessor or bailor under a lease
or bailment of goods.
Clause 6: Adoption of Commonwealth PPS Act
The clause provides that the PPS Act (as
amended in 2009 and 2010) is adopted by
Tasmania. This provides the power for the
Commonwealth to apply the PPS law to
security transactions in Tasmania.
The Australian Constitution provides for
"adoption" where the Commonwealth
legislation is already in place and a referral of
powers is made after it has been put in place).
The adoption (like a referral) can be
terminated by the State (see section 7).
Clause 7: Termination of Adoption
Covers the termination of the adoption made
under clause 6 by proclamation. The date
specified for termination is to be no earlier
than 12 months and one day from the date the
proclamation is published in the Government
Gazette. Additional references (eg to amend)
can be terminated under section 9.
Clause 8: Reference of matters
Subclause 8(1) in effect allows the future
amendment of the Commonwealth PPS Act
concerning security interests in personal
property (other than fixtures or water rights)
by specific amendment to the Commonwealth
PPS Act (and does not allow the referral to be
used for other purposes).
Subclause 8(2) will enable referral of security
interests in fixtures to the Commonwealth
Parliament at some point of time in the future
if Tasmania considers it appropriate (on
Proclamation of commencement of the
subsection). It will allow amendment of the
Commonwealth PPS Act concerning fixtures at
and from that time.
Subclause 8(3) in effect provides for the future
referral of matters to the Commonwealth
Parliament of coverage of security interests in
transferable water rights in the PPS Act. Again
this will only occur when it is considered
appropriate for the subsection to be activated
and is subject any exclusions of dealings with
State statutory rights.
Subclause 8(4) provides that each of the
references is not limited by any of the other
references.
Subclause 8(5) provides that the reference of a
matter has effect only to the extent that the
matter is not otherwise within the legislative
power of the Commonwealth Parliament and
to the extent that the matter is within the
legislative power of the State Parliament. The
intent being that the referral supplements the
Commonwealth's constitutional powers (eg
Inter-State trade; corporations etc) which
could cover part of the PPS scheme.
Subclause 8(6) specifies the period during
which a reference has effect. Each reference
will begin when the subsection that makes the
reference commences (which may be different
dates) and ends when the period of that
particular reference is terminated under the
proposed section 9.
Clause 9: Termination of reference
Covers the termination, by proclamation, of
the amendment references made under clause
8. As agreed between the States and the
Commonwealth the date specified for
termination is to be no earlier than 12 months
and one day from the date the proclamation is
published in the Government Gazette.
Clause 10: Amendment of Commonwealth law
Clause 10 is to make it clear that the State
Parliament envisages that the Commonwealth
PPS Act can be amended or affected by
Commonwealth legislation enacted in reliance
the referral or adoption under this Act
(subclause (a)) or enacted on the basis of any
of the Commonwealth's other Constitutional
powers.
Provisions in the intergovernmental
Agreement on Personal Property Securities
Law that underpin the scheme may require
consultation with and possibly agreement
through the Standing Committee of Attorneys
General on some matters where the
Commonwealth proposes to change the PPS
Act.
Clause 11 Effect of termination of amendment
references before termination of
adoption of Commonwealth Act
The clause provides that the separate
termination of an amendment reference does
not affect Commonwealth laws already in
place. Accordingly, the amendment reference
continues to have effect to support those laws
until the initial adoption on the PPS scheme is
also terminated.
Clause 12 Administration of the Act
Provides for the administration of the Act by
the Minister for Justice and the Department of
Justice.