Leading lawyer has put forward recommendations following a 10 statutory review, tabled by Attorney-General George Brandis QC in Federal Parliament last week.
Tackling the complexity of the Personal Property Securities Act 2009 and the Personal Property Securities Register, the report on the review makes almost 400 recommendations to combat the register’s underuse.
The report was prepared by Ashurst
partner, Bruce Whittaker, who said the review is vital in ensuring the register is utilised by Australian businesses.
“The act has actually been causing a whole heap of grief for both financiers but also for large and small companies, ever since it came into effect because they are really struggling to understand what the act means and what they need to do to comply with it,” Whittaker said. “If you don’t document your deal in a way that complies with what the act requires, and in particular, if you don’t register something on this Personal Properties Securities Register, and if you don’t do that registration properly, you are at risk that you could lose your assets.”
Whittaker said much of the wording the legislation was taken from overseas where the general law is different and doesn’t necessarily work as well as it could for the Australian commercial world.
“There are a lot of ways in which the act just didn’t fit the Australian commercial environment so really the focus was getting it to fit better and to try and strip out some of the unnecessary complexity,” he said. “At the moment, because we’ve inherited it from overseas, it also uses a lot of overseas terminology that’s quite alien to Australian eyes.”
Whittaker said the changes will ensure “greater confidence that they understand what the act actually does and that in turn will make them more prepared to allow people to use their collateral as security, and that will improve the cost of finance to businesses and consumers as well”.