From 1 October 2015 leases or bailments of serial numbered goods for a term of between 90 days and one year soon won't need to be registered on the Personal Property Securities Register, unless they are "in substance" security interests that secure payment or performance of an obligation.
The change was introduced by the Personal Property Securities Amendment (Deregulatory Measures) Act 2015, which we explained in detail in June when it was passed. At the time there was a "backstop" commencement date in December 2015, unless the Government proclaimed the change to take effect earlier.
A proclamation (dated 17 September 2015 and registered on 22 September 2015) has now fixed 1 October 2015 as the date for commencement of Schedule 1, which contains this amendment.
Schedule 1 amends the Personal Property Securities Act by deleting paragraph (e) of the section 13(1) definition of PPS Lease (which is about leases or bailments of serial numbered goods that exceed 90 days, or that can exceed 90 days with renewals and extensions). It will also make a consequential amendment to section 268.
Get ready for 1 October 2015
For leases and bailments of goods entered into after 1 October 2015, the relevant period to look at is one year or more for all goods, and serial numbered goods are not dealt with differently. Leases or bailments of an indefinite term are also still included in the definition of PPS Lease. The Personal Property Securities Amendment (Deregulatory Measures) Act 2015 does not affect leases or bailments entered into before 1 October 2015.
You should have already reviewed your internal processes to ensure you are registering the leases that need to be registered and updated your processes in anticipation of the Schedule coming into effect. If you haven't, you should do so urgently, to ensure that you no longer register leases unnecessarily on the Personal Property Securities Register.
You might also be interested in...
Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.