Chapter
6
The Personal Property Securities Bill
6.1
Personal property is 'any form of property other than land or buildings
and fixtures which form part of that land. It can include tangibles such cars,
boats, machinery, crops; as well as intangibles such as shares, intellectual
property and contract rights'.[1]
6.2
The Government has undertaken reform of personal property securities, to
introduce a nationally consistent law and register system. The amendments were
made by the Personal Property Securities Act 2009 (PPS Act), the
provisions of which are due to commence in October 2011.
6.3
On introducing the bill, the Attorney-General stated the legislation:
...will replace the existing complex, inconsistent and ad hoc
web of common law and legislation, involving over 70 Commonwealth, state and
territory acts. It will implement a single national law, creating a uniform and
functional approach to personal property securities...[and] will apply to all
transactions which create an interest in personal property that secures a loan
or other obligation.[2]
6.4
The Offshore Resources Legislation Amendment (Personal Property
Securities) Bill 2011 addresses different matters than the other four bills in
the package this committee is considering (in that it does not deal with the
establishment of national offshore petroleum regulators). The Personal Property
Securities Bill, or PPS Bill, amends the Offshore Petroleum and Greenhouse
Gas Storage Act 2006 (the OPGGS Act) and the Offshore Minerals Act 1994
(the OMA) to provide that any security interests acquired in petroleum,
greenhouse gas and offshore minerals titles are not personal property
securities for the purposes of the PPS Act.
6.5
DRET explained that one of the rationales behind the bill is to ensure 'Government
objectives are met, while the regulatory burden on industry is not increased'[3]:
...it is stated Commonwealth policy that, in order to remove
duplication and increase clarity, existing approval and registration
requirements for personal property securities, and dealings in these
securities, should either be removed from Commonwealth Acts so that PPS Act
registration requirements only will apply, or that the PPS Act should be
expressly excluded from application to personal property under relevant
Commonwealth Acts dealing with personal property and interests in personal
property.
If no amendments are made to the OPGGS Act and OMA, offshore
petroleum, greenhouse gas and minerals titles will be "personal
property" for the purposes of the PPS Act, and the registration and other
provisions of the PPS Act will apply to these titles, in addition to the
requirements of the OPGGS Act and the OMA. This Bill implements the policy
decision to expressly exclude application of the PPS Act for the purposes of
dealings relating to titles under the OPGGS Act and the OMA. As a result of the
proposed amendments, all types of title and licence granted under either piece
of legislation, or various types of rights and interests acquired in relation
to those titles and licences, are not personal property for the purposes of the
PPS Act.[4]
6.6
Among other important issues, under the current framework the Designated
Authority and the Commonwealth Minister have the ability to refuse approval and
registration of an interest in certain titles. These provisions 'enable the
regulator to ensure the suitability of the entities that potentially are able
to exercise control over the exploitation of Australia's offshore petroleum
resources'.[5]
Consequently, DRET argues that it is necessary to separate interests under the
OPGGS Act from those covered by the PPS Act, which are not similarly
"vetted".[6]
Committee view
6.7
Other than a supplementary submission from the Department of Resources,
Energy and Tourism explaining the intent of the bill, the committee did not
receive any submissions regarding this bill. However, the committee considers
the provisions in the bill are appropriate to provide consistency between
relevant Commonwealth and State/Territory legislation, minimise legal confusion
and to ensure that unnecessary regulatory burden and costs to the mining
industry and investors are not imposed.
Recommendation 2
6.8
The committee recommends that the Offshore Resources Legislation
Amendment (Personal Property Securities) Bill 2011 be passed.
Senator Annette Hurley
Chair
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