subject: Particular House Securities Act - It Could Impact You [print this page] In the continent of Australia, in the year 2009, a new legislation called as the Personal Property Securities Act, shortly called as PPSA was passed and it came into force from the year 2011 and professionals says that it is similar to the acts that previously came into force in the New Zealand and Canada. The new act triggers reflective modifications in the way in which security is taken over personal property and due to these modifications industries operating under different sectors, particularly the retail, wholesale and manufacturing sectors will be affected. The act is applicable to any form of asset irrespective of whether it is tangible or intangible owned by any legal entity; however, it excludes water and land rights and some specific rights created by statute.
The purpose of this act is to rationalize procedures pertaining to formal insolvency appointments and it is applicable to security trust deeds, consignments, leases made for more than a year, etc However, when it comes to practical application of the rule, it has wide implications as compared to insolvent practitioners and solvent companies.
Professional lawyers in Australia are suggesting that the Personal Property Securities Act is risky to many businesses running in this continent. Therefore, they recommend that entrepreneurs should understand the general asset protection and structures like separation and trusts of entities. It would be better for businessmen to get professional help from attorneys for protecting themselves from any form of risk in such a way that the interest of their business can be protected.
When seeking the help of a professional, it is better to contact an attorney, who has experience in handling cases pertaining to PPSA and generally professionals will cover the following points when drafting a plan for protecting the interest of their clients:
Review of group structure inclusive of agreements and arrangements between entities and in case their clients are supplying inventory to another entity, the terms of trade should also be reviewed by them. Also, they should review the processes for ensuring that their client has registered his security interest in inventory before selling any stock. If the attorney finds that the client has not agreed in writing for the Retention of Title (ROT) and has registered the same for making it effective, he should do it immediately for protecting the interest of their client. For ensuring that the ongoing supplies of their customer are protected, they should register a Purchase Money Security Interest.
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