Last Wednesday 19 March 2014, a bill was introduced into Parliament to amend section 13 of the Personal Property Securities Act 2009 (Cth) to remove the provision that deems leases of serial-numbered goods of more than 90 days to be a ‘PPS lease’. The bill, called the Personal Property Securities Amendment (Deregulatory Measures) Bill 2014 (Cth), and Explanatory Memorandum may be accessed on the Federal Parliament’s website here.
The provision to be removed is s 13(1)(e). Those who are familiar with it will be aware of the questions and uncertainties to which that provision has already given rise. It should be noted however that the change, when enacted, will apply only in respect of transactions entered into after the amendment has been enacted (per ss 2 and 7 of the Bill and the insertions to Schedule 1).
The EM notes that this should simplify the deeming provisions in the PPS Act and minimise the need for small and medium hire businesses to make registrations in respect of leases of a term of less than 12 months. This should reduce the number of transactions gtiving rise to PPS leases and reduce the compliance cost born by small and medium hire businesses.
The EM also notes that the change will bring the Australian PPS Act into alignment with PPS regimes in New Zealand and Canada on this point. Thus to the extent that the activities of Australian enterprises cross over into these jurisdictions, this alignment may have benefits for Australian financiers, businesses and legal practitioners.
For those who wish to read the EM for themselves, the direct link to it is here.
References: (1) Parliament of Australia’s webpage for the Personal Property Securities Amendment (Deregulatory Measures) Billl 2014 (link); (2) Client update of Allens Linklaters entitled “PPSA Amendments for ‘Serial Numbered goods'”, wirtten by Andrew Boxall and Daniel MacPherson (link)