Bills Digest no. 60 2009–10
Personal Property Securities (Consequential Amendments)
Bill 2009
WARNING:
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Bill.
CONTENTS
Passage history
Purpose
Background
Financial implications
Main provisions
Contact officer & copyright details
Passage history
Date
introduced: 21 October
2009
House: House of Representatives
Portfolio: Attorney-General
Commencement:
Various dates contained in
the table in clause 2.[1]
Links: The
relevant links to the Bill, Explanatory Memorandum and second
reading speech can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/.
When Bills have been passed they can be found at ComLaw, which is
at http://www.comlaw.gov.au/.
The purpose of the Bill is to
amend 25 Commonwealth Acts that deal with the creation,
registration, priority, extinguishment or enforcement of interests
in personal property.
The Personal Property Securities Bill 2009 (the principal Bill)
was introduced into the House of Representatives on 24 June
2009. The background to the principal Bill is set out in the
relevant Bills Digest.[2] In essence it establishes a register of personal
property securities in place of separate registers tracking whether
there is any mortgage or loan or other financial encumbrance over
assets. The principal Bill will apply to all transactions which
create an interest in personal property that secures a loan or
other obligation.
According to the Attorney-General the current Bill:
represents the next stage in the Government s
harmonisation of Australia s personal property laws.
Currently there are over 70 Commonwealth, State
and Territory laws, as well as common law and rules of equity
governing security interests in personal property.
These different laws vary in their application
according to the form of the transaction, the nature of the debtor
or the jurisdiction in which the property is located. This adds
significantly to transaction costs.
Personal property securities reform is an
important part of COAG s deregulation agenda.[3]
The principal Bill was referred to the Senate Legal and
Constitutional Affairs Legislation Committee for inquiry and
report. The report was of the Committee was published on 20 August
2009.[4] The
Committee recommended that the principal Bill be passed subject to
a commitment from the Government to, amongst other things:
include in a consequential amendments bill to
be debated in the Senate cognately with this Bill and intended to
take effect immediately after the commencement of the 2009 Bill all
changes to the Bill identified as a result of concerns raised with
this committee and subsequently directly with the department during
the recommended further period of consultation until 30 September
2009.[5]
The Government response to that recommendation is the current
Bill which contains, in Schedule 4, the changes to the principal
Bill which were identified by the Committee.
In addition, the Liberal Senators in the Committee recommended
that the Government develop and implement a comprehensive education
campaign for small to medium business and others prior to the
start-up date for the new personal property securities
system.[6] That
recommendation was accepted by the Government which undertook to
develop and implement an education campaign prior to the
commencement of the new personal property securities
system.[7]
On 29 October 2009 the Senate referred this Bill to the Senate
Legal and Constitutional Affairs Legislation Committee for inquiry
and report by 16 November 2009.[8] The closing date for
submissions is 9 November 2009.[9]
According to the Explanatory Memorandum, the Bill will not have
a financial impact on the operations of Government.[10]
The Bill contains five Schedules.
Items 1 18 of Schedule 1 amend the
Fisheries Management Act 1991 (Fisheries Management Act)
and the Torres Strait Fisheries Act 1984 (TS Fisheries
Act).
Item 1 inserts the term PPSA
security interest[11] into the interpretations contained in existing
subsection 4(1) of the Fisheries Management Act to differentiate
between interests arising under the Fisheries Management Act and
security interests to which the Personal Property Securities Act
(when enacted) applies.
Items 5, 10 and 17 recognise
that from the Personal Property Securities Act
registration commencement time, PPSA
security interests will be registered on the PPS register.[12]
The Fisheries Management Act provides for the creation of
statutory fishing rights options under existing section 31A.
Item 7 of Schedule 1 of the Bill inserts
proposed section 31FA which sets out the priority
between a PPSA security interest and a statutory fishing rights
option. Similarly, item 12 inserts
proposed section 46A which sets out the priority
between a PPSA security interest and an interest in a
fishing right.[13] In particular, interests under
section 31F or 46 will have priority over unperfected PPSA security
interests in the same property.[14]
Item 16 inserts proposed section
108A which provides that the seizure, detention or
forfeiture of a boat or any other property under the Fisheries
Management Act will have effect despite any action taken in
relation to enforcement of a PPSA security interest in the boat or
other property.
Items 19 20 of Schedule 1 amend the TS
Fisheries Act. Item 19 inserts the definition of
PPSA security interest into existing
subsection 3(1) of the TS Fisheries Act. Item 20
inserts proposed section 52J to ensure that any
the seizure, detention or forfeiture of a boat or any other
property under the TS Fisheries Act will take precedence over any
enforcement action taken in respect of the same personal property
under the Personal Property Securities Act (when enacted).
Schedule 2 contains various amendments to the following
intellectual property statutes:
- Designs Act 2003 (Designs Act)
- Patents Act 1990 (Patents Act)
- Plant Breeder s Rights Act 1994 (Plant Breeder s
Rights Act) and
- Trademarks Act 1995 (Trademarks Act).
Items 1, 14, and 18 insert the
definition of PPSA security interest into
the Designs Act, Patents Act and Trademarks Act respectively. Under
each of those Acts, a person who is the registered owner of a
design, patent or trademark respectively may register their rights
on a Register that has been created under the relevant Act. The
effect of the amendments in Schedule 2 is to preserve those
Registers and to allow the continuing registration of designs,
patents and trademarks. However, if the interests registered
satisfy the definition of PPSA security interest, they will
also have to be registered on the Personal
Property Securities Register in order to preserve priority.[15]
Items 16 and 17 insert
reference to the Personal Property Securities Act into the Plant
Breeder s Rights Act.
Schedule 3 makes consequential amendments to the following
maritime statutes:
- Admiralty Act 1988 (Admiralty Act)
- Marine Navigation Levy Collection Act 1989 (MN Levy
Collection Act)
- Marine Navigation (Regulatory Functions) Levy Collection
Act 1991 (MN (Regulatory Functions) Levy Collection Act)
- Navigation Act 1912 (Navigation Act)
- Protections of the Sea (Civil Liability) Act 1981
(PotS (Civil Liability) Act)
- Protection of the Sea (Harmful Anti-fouling Systems) Act
2006 (PotS (Harmful Anti-fouling Systems) Act)
- Protection of the Sea (Prevention of Pollution from Ships)
Act 1983 (PotS (Prevention of Pollution from Ships) Act)
- Protection of the Sea (Shipping Levy Collection) Act
1981, and (PotS (Shipping Levy Collection) Act), and
- Shipping Registration Act 1981 (Shipping Registration
Act).
In the case of the MN Levy Collection Act,[16] the MN (Regulatory Functions)
Levy Collection Act,[17] the PotS (Civil Liability) Act,[18] the PotS (Harmful Anti-fouling
Systems) Act,[19]
the PotS (Prevention of Pollution from Ships) Act[20] and the PotS (Shipping Levy
Collection) Act,[21] the amendments will have the effect that enforcement
action under those Acts will take precedence over any enforcement
action in respect of the same goods under the Personal Property
Securities Act (when enacted).
By contrast, item 18 repeals existing sections
38 44A of the Shipping Registration Act which currently deal with
the priority of mortgages over ships. Item 25
inserts proposed section 59A which will require
mortgages over ships and caveats to be registered on the Personal
Property Securities Register and that provisions of the Personal
Property Securities Act (when enacted) will be used to determine
priorities of securities interests in ships.
Schedule 4 of the Bill amends the Personal Property Securities
Act. Importantly, none of the provisions will come into force until
immediately after the Personal Property Securities Act
2009 commences. In addition items 8 and
36 are dependent upon the enactment of the
National Consumer Credit Protections Act 2009.
According to the Explanatory Memorandum:
Schedule 4 makes minor technical amendments in
response to submissions made to the Senate Legal and Constitutional
Affairs Committee s inquiry into the provisions of the PPS Bill and
subsequently to the Attorney-General s Department. The PPS Bill is
being amended through the Consequential Bill, rather than by way of
parliamentary amendments, to avoid the need for States who have
given a referral of power to give a further referral of power in
respect of the amendments.[22]
Many of the amendments have already been flagged in the Bills
Digest for the principal Bill.
Schedule 5 makes consequential amendments to the following
Commonwealth statutes:
- Air Services Act 1995
- Bankruptcy Act 1966 (Bankruptcy Act)
- Commonwealth Inscribed Stock Act 1911
- Corporations (Aboriginal and Torres Strait Islander) Act
2006
- Health Insurance Act 1973
- Insurance Act 1973
- Privacy Act 1988 (Privacy Act)
- Quarantine Act 1908, and
- Wool International Act 1993.
Notably, items 5 9 insert definitions into the
Bankruptcy Act so that there will be consistency with the
definitions in the Personal Property Securities Act (when enacted).
In particular item 9 substitutes a new definition
of secured creditor which includes a PPSA
secured party where the PPSA security interest arose as security
for the debt, and is perfected.
In addition, items 25 30 amend the Privacy Act.
Item 29 inserts proposed section
28B which empowers the Privacy Commissioner to investigate
an act or practice that may be an interference with the privacy of
an individual under the Personal Property Securities Act.
Item 26 adds a note at the end of existing section
13 to the effect that certain contraventions of the Personal
Property Securities Act (when enacted) will be an interference with
the privacy of an individual.
Copyright Commonwealth of Australia
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concerns or complaints should be directed to the Parliamentary
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Paula Pyburne
12 November 2009
Bills Digest Service
Parliamentary Library
© Commonwealth of Australia
This work is copyright. Except to the extent of uses permitted
by the Copyright Act 1968, no person may reproduce or transmit any
part of this work by any process without the prior written consent
of the Parliamentary Librarian. This requirement does not apply to
members of the Parliament of Australia acting in the course of
their official duties.
This work has been prepared to support the work of the Australian
Parliament using information available at the time of production.
The views expressed do not reflect an official position of the
Parliamentary Library, nor do they constitute professional legal
opinion.
Feedback is welcome and may be provided to: web.library@aph.gov.au. Any
concerns or complaints should be directed to the Parliamentary
Librarian. Parliamentary Library staff are available to discuss the
contents of publications with Senators and Members and their staff.
To access this service, clients may contact the author or the
Library’s Central Entry Point for referral.
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