If your business supplies goods to customers on credit, your terms of trade should include clauses relating to the PPSR. If your terms have PPSR provisions but you have not been registering those interests on the PPSR, you should start.
Once you are granted a security interest, you can (and should) register that interest on the PPSR as soon as possible. Registering your security interests on the PPSR is easy. It only takes a few minutes and the registration process can be completed online. The fee for registering your financing statement on the PPSR is $20.00. Your financing statement lasts five years but it can be renewed, if you still need it when it comes up for renewal.
The main benefit of having your financing statement registered on the PPSR is that, if your customer goes into liquidation or has receivers appointed, your goods will not be available to the general body of unsecured creditors. As a secured creditor, you can take back your goods (provided they have not yet been paid for) or, if your goods have been sold, you can trace into the proceeds of sale of your goods (when your goods are paid for by a third party).
If you don’t register your security interest on the PPSR and another creditor has been given and registered a General Security Agreement (“GSA”), the GSA holder will have priority over your goods. We often deal with creditors who have registered their security interests on the PPSR too late, if at all, and have lost their priority in goods to other parties’ security interests.
It’s a good idea to review your internal PPSR procedures on a regular basis. If you think it’s time for a review or you want to discuss how you can use the PPSR to your best advantage, get in touch with the team at McDonald Vague.
You and your staff have worked hard to produce goods. If you sell your goods on credit, no doubt, you eagerly await payment for those goods each month. Did you know that you can take a positive, cheap, and effective step to protect your business and your goods while you’re waiting to receive payment?
The Personal Property Register (“PPSR”) is a publicly accessible, searchable database that allows secured creditors to notify the world that they have an interest in goods that are in the possession of someone else. This interest is called a security interest. Registering your security interest can be done online. The document you register on the PPSR is called a financing statement. Your financing statement notifies other parties that, if the debtor does not pay you the amount it owes or fails to perform its obligations to you, you have the right to take back your goods.
You can also search the PPSR online:
- by a party’s name or company number, which will tell you who has registered security interests against that party and what goods have been secured.
- for specific goods by serial number, which will tell you whether another party has a registered security interest in that good.
PPSR searches cost $3.00 each.
The PPSR is a useful business tool. Even though the PPSR has been used in New Zealand since 2002, we regularly deal with creditors who are not taking advantage of the PPSR.
If you want to discuss how you can use the PPSR to your best advantage, give the team at McDonald Vague a call. We’ll help you get it right.