Personal Property as far as the PPSR is concerned is all property of a business. This includes all equipment, vehicles, stock, computers and even includes items such as the business's debtor’s ledger (outstanding payments from customers).

The PPSA stands for Personal Property Securities Act which is the legislation itself and the PPSR or Personal Property Securities Register is the register where an entity wanting to register a security interest can do so.

The Personal Property Securities Register is simply an online notice board which is a register of security interests placed by businesses and individuals against the businesses or individuals to which they extend credit.

It is located online and is an Australian Federal Government Program which is managed specifically by the Australian Financial Security Authority. 

By registering on the PPSR you automatically become a secured creditor over your client’s business with the same protection as the banks. As a secured creditor you are protected against Preferential Payment Clawback.

Since the introduction of the PPSR liquidators now has the right to claw back any payments made to an unsecured creditor in the previous 6 months from the date of liquidation, in favour of a secured creditor.

This means that if one of your clients was to file for liquidation and you haven’t registered on your client's PPSR and become a secured creditor, you could lose the last six (6) months of payments made to you by that particular client.

Generally speaking, there are two main types of PPSA Registrations. First is a PMSI or Purchase Money Security Interest which is a registration attached to a specific piece of equipment such as a vehicle or piece of machinery. The second is an ALLPAAP which stands for All Present and After Acquired Property which is s general security interest over the entire assets of the business which is being registered.

Yes, It is called an ALLPAAP registration and is a general security interest over the assets of your client’s business.

A PPSA registration can be done online at www.ppsr.gov.au

Yes and No. Yes, a business can simply go online and register a security interest but unless they have an agreement between themselves and their clients which incorporates the appropriate legislation their registration will be deemed to be invalid?

Of course, this varies but it is generally recognised that there are about 8 000 000 PPSA registrations at any one time.

There was an analysis done in the last couple of years by a major Australian credit reporting company which showed that somewhere in the vicinity of 80% or 6 500 000 existing PPSR were actually invalid.

Given that the PPSR is an online noticeboard and can be accessed by anyone, there are a large number of registrations made without the proper authority.

Depending on the industry, most entities will include the appropriate legislation in their Terms and Conditions.   

It depends on the time period in which the registration is required to last, but at the time of writing most, if not all registrations cost $6.

A PPSA Registration can last up to 25 years but 99.9% of all registrations are 7 years in length. 

Yes, however to maintain your position on the PPSR you can simply pay another $6 in 7 years to amend your registration, thereby maintaining your position on your client's PPSR instead of registering a completely new registration.

The PPSR works on date order. No entity has preference over another, your priority is simply the date on which you registered.  

When a business registers on its client's PPSR they become a secured creditor over that particular client. Any business that hasn’t registered on their client's PPSR is automatically an unsecured creditor.

Since the introduction of the PPSR, any business that hasn’t registered on the PPSR is automatically classed as an unsecured creditor and is potentially subject to Preferential Payment Clawback.

It depends on your potential liability. Given that Preferential Payment Clawback is now a regular issue when a business files for liquidation, it really depends on your exposure. We recommend registering any monthly account of $500 or more but it’s up to the individual business.

There are no minimum or maximum dollar value registrations of the PPSR. As mentioned above it is simply up to the business as to their potential liability when considering the potential impact of Preferential Payment Clawback.

Preferential Payment Clawback has been around for decades. However, since the introduction of the PPSR, there is now a defining line as to what is classed as a secured creditor and more importantly what is now classed as an unsecured creditor.

Preferential Payment Clawback is the term used when a liquidator claws back money from an unsecured creditor in order to pay a secured creditor.

Essentially when a business files for liquidation a liquidator will review the potential liquidated assets of that business against any secured creditors (businesses who have registered on the PPSR). If it turns out that there is more owed to the secured creditors than the liquidated assets of the business, the liquidator will review the last 6 months of transactions prior to liquidation looking for payments to any unsecured creditors. (businesses who have NOT registered on the PPSR).

Once identified the liquidator has the legal right to demand the return of any amounts paid to any unsecured creditors in the previous 6 months. This can be 10’s if not 100’s of thousands of dollars.

Essentially if one of your client's files for liquidation and you haven’t registered as a secured creditor on the PPSR, then there is a possibility that you will be contacted by the liquidator, who will, in turn, demand the return of any payments made to your business by your liquidated client in the previous 6 months.

You need to have Up To Date Terms and Conditions which have been agreed to by your clients, which are in turn used as approval to register as a secured creditor on your clients PPSR files.