encompass ppsr masterclass - session 1: transitional or migrated securities
DESCRIPTION
PPSR Masterclass: Session 1 - Transitional or Migrated Securities with Rhonda Arnott Now is the time to ensure that your clients’ migrated and transitional security interests are fully protected. A failure to act will result in securities being lost. Join this session with Rhonda to understand the ‘find and claim’ process and the change in priority rules that apply from 31 January 2014 when the transitional period expires. For all the upcoming Encompass webinars, click here: http://www.encompasscorporation.com/encompass-webinarsTRANSCRIPT
PPSR Masterclass
Transitional or Migrated Securities: Use it or lose it!Starting at 12pm AEST
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PPSR MasterclassTransitional or Migrated Securities: Use it or lose it!12.00 - 12.45pm with Rhonda Arnott
Your Host
Your hosts: Encompass | SAI Global
Polls: During the webinar I will be asking you to take some polls so we can understand your interests.
Questions: Please type your questions in the chat box and we will try to address as many of them as we can during this webinar.
Tamarind Leigh BegleySAI Global
Your Presenter
In more than 15 years of legal practice, Rhonda has advised and represented a large range of national and international clients, in capital raisings, corporate restructures, mergers and acquisitions.
Rhonda also advises boards and internal committees in relation to corporate governance, conflicts of interest, related party transactions, continuous disclosure and compliance with the PPSR, Corporations Act and ASX Listing Rules.
Migrated Securities Transitional Securities
Find & Claim Priority Rules Recent Cases Conclusions
PPSA
• Commenced 30 January 2012 - (RCT)
• 2 year Transitional Period
• Expires 30 January 2014
Personal Property Securities Act 2009 (Cth)
• Migrated 23 Commonwealth, State and Territory Registers
• 4.7 million registrations in total migrated
• 95% ASIC• Problems with
Migration
Migrated Securities
• Migrated securities• Transitional Security
Interests also include:• Previously not considered
security • Previously no register• Example:
– ROT– PPS Leases– Consignment
Transitional Security Interests (TSI)
• Temporary Perfection:• Section 322 PPSA:• Deemed to have
perfection:• From immediately
prior to RCT (30 Jan 2012)
• Until either:– Perfection under
PPSA; or– 24 months after
RCT (i.e. 30 Jan 2014)
Perfection of TSI
PPS Register - migrated given SPG Number
Preliminary Steps:– Create an account
with PPSR– Given access to
Find & Claim– Create New SPG:
SPG Number and Access Code
Migrated Securities - Find & Claim
1.Find: Selecting Migrating Register
Process Find & Claim
2. Select mode, status (unclaimed SPG), Enter Name/ABN/ACNTips: Wildcard search, e.g. *Business*
Process Find & Claim (Continued)
CLAIM:
• Select Securities• Claim: Enter Target (new) SPG
Number and Access Code and Email
• Receive: Verification Statement, Token
Tip: Mistakenly Claim cannot unclaim (Notify National Service Centre, Snr Business Office)
Process Find & Claim (Continued)
Migrated Securities are TSI – remain
perfected – ss330 and 331
Necessity of Find & Claim – correct
details – security not defeated
Post Transition - 31 Jan 2014
Transitional Securities NOT
MigratedLose deeming
perfection Unperfected/unsecured
Priority Rules: Transitional Securities Interests 30 Jan 2014
Explanation of priorities involving transitional security interests
Item
The following security interest
Has priority over
Because.
1. a perfected TSI an unperfected security interest (including a TSI)
Section 55(3).
2. a perfected TSI a perfected security interest that is not a TSI
Sections 55(5), 322 and 322A
3 an unperfected TSI unperfected security interest that’s NOT TSI
Section 55(2) and 321
4 an unperfected TSI unperfected TSI
Section 55(3)
S 320 PPSA
New Rules Priority: Post Transitional Period: 31 Jan 2014
Explanation of priorities involving security interests
Item
The following security interest
Has priority over:
Because:
1. Perfected Security Interest
Security Interest Perfected later in time
Sections 55(4) & (5)
2. Perfected Security Interest
Unperfected Security Interest (including TSI)
Section 55(3)
3. Unperfected Security Interest
Unperfected Security Interest that attached later in time
Section 55(2)
Case: Re: Maiden Civil
In the matter of Maiden Civil (P&E) Pty Ltd, Richard Albarran & Claire Alexander Pleash as Receivers & Mangers of Maiden Civil (P&E) Pty Ltd & Ors v Queensland Excavation Services Pty Ltd & Ors [2013] New South Wales Supreme Court 852
Facts:• Westpac/Esanda financed QES
purchase Caterpillar machinery• Machinery leased Maiden in
May-August 2010 (Pre PPSA)• QES did not register interest
after 30/1/2012
Case: Re: Maiden Civil - Continued
Facts:
• May 2012 Maiden entered GSA Fast Financial Solution (ALLPAP) Registered
• July 2012 Receivers/administration/liquidation
On the face:
Transitional PPS Lease (temporary perfection) v perfected Security interest (ALLPAP)
Case: Re: Maiden Civil - Continued
Is it deemed perfection?
• Lease was registerable at time created (NT Register of Motor Vehicles)
• Section 322(3) PPSA & Reg 9.2 (2010 Regs) - Specific Exemption - Not TSI & no deemed perfection
Fast Won:
Perfected Security Interest (GSA) v Unperfected TSI
• If could have been registered at RCT and not - not benefit from temporary perfection
• Unregistered interest Lessor lose to Lessee – nemo dat
• Financiers register own interest insist Borrower required to register where parts with possession
• Danger relying transitional provisions soon be unavailable
Take Outs
Find & Claim: Migrated securities
Conclusion
Perfect/Register all other Transitional
Securities