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Running a business where you rent, lease or sell goods under terms or through agreements can be both rewarding and risky work. There is always a potential for a customer to default on a payment or become insolvent. For this reason, the New Zealand government enacted the Personal Property Securities Act (the PPSA), which set up the Personal Property Securities Register (the PPSR). This article will outline:

  • what the Personal Property Securities Register is;
  • how the PPSR can aid your business; and
  • how your business can register its interests on the PPSR.

What Is the Personal Property Securities Register?

The Personal Property Securities Register is a national register where individuals and businesses can register a legal claim or security interest to personal property. Personal property includes:

  • goods, such as equipment, vehicles and crops;
  • intangible property, such as company shares, art licenses, intellectual property and money; and
  • items you will purchase in the future. 

Land is excluded from the definition of personal property.  

How Can the PPSR Help My Business?

Registering personal property on the PPSR can assist your business in two key ways. We set these out below.

To Assist in Recovering What You Are Owed

When you rent, lease or sell goods to your customers, your business will likely enter into a hire purchase or lease agreement with that client. This agreement should clearly:

  • identify the goods up for lease or sale;
  • contain a retention of title clause; and 
  • state that a security interest is taken in the customer’s present and after-acquired property. 

A retention of title clause details that your business retains legal ownership of those goods until the customer pays for the goods in full. 

Additionally, if the customer does not pay your business, you can take possession of those goods. Registering a financing statement on the PPSR is also an additional layer of security. It prioritises your entitlement to those goods against any other security holders in respect of the same goods. 

Further, registering your business’s interest in that personal property on the PPSR gives your business a far better chance of recovering those goods or something else of the same value. That is because registration acts as a disincentive for your customers to hold onto or resell hired goods they have not completely paid for. 

Likewise, registration means that your customer will have a searchable security interest registered against them. This will deter other businesses from dealing with them. Furthermore, should this customer resell your property, you are legally entitled to reclaim this personal property from the new purchaser. 

To Credit-Check Potential Customers

The PPSR also allows your business to check the credit of any potential customers. You can use the PPSR to check to see if a potential customer has any security interests registered against them. In other words, you can see if a potential customer is in any debt for unpaid goods that they have hired or intended to purchase. Doing so helps work out whether a customer will hold up their end of the hire purchase or lease agreement and complete the payment for your goods.

How Can My Business Register With the PPSR?

There is a four-step process for registering your business’s personal property with the PPSR. 

1. Set-Up an Account

To register personal property with the PPSR, you will have to have an online services account with the Companies Office. To create an account, you will need a RealMe login. Your business can get a RealMe login through the Companies Office website

Once your business has a RealMe login, you will need to specify what type of account you need for your PPSR account. If you have not logged in to the PPSR before, your business will require a new organisation account. 

2. Register as a Secured Party Group

Once you have created your online services account and logged in for the first time, you will need to create an SPG or a secured party group. SPG is a phrase used to refer to your business or any organisation that registers its interests on the PPSR. 

You can create an SPG for your business using the ‘My Portfolio’ tab on the PPSR user dashboard. 

3. Gather All Required Information

To register a financing statement to secure your business’ personal property interest, you will need information relevant to your interest. This includes details about the property in which you are registering an interest. The necessary information will vary depending on:

  • the property type; 
  • the customer hiring or purchasing that property, including their name and date of birth; and 
  • your SPG. 

You will also need to specify the period that the customer will hire the property for or the date they should completely pay for it. You must specify these details if it is a period of less than five years after registration. Otherwise, the financing statement will automatically expire after five years unless renewed earlier.

4. Register 

Once you have gathered this information, you can register your financing statement. You can do this by selecting ‘create’ under the PPSR registrations tab on the PPSR user dashboard. If you wish to pause your registration, you can choose ‘save and exit’ to store an unfinished registration for up to 30 days. 

Once you have entered the above information and paid the registration fee, your financing statement and registration process is complete. 

Key Takeaways

The Personal Property Securities Act set up the Personal Property Securities Register. This register assists your business in securing payment from customers that hire or purchase goods from you. You can register an interest in personal property by:

  • setting up an online services account with the Companies Office;
  • registering your business as a secured party group; and
  • completing a financing statement registration online. 

If you need assistance with registering your business’ security interests, contact LegalVision’s corporate lawyers on 0800 005 570 or complete the form on this page.

Frequently Asked Questions

What does PPSR mean?

PPSR stands for the Personal Property Securities Register.

What is the PPSA?

The PPSA is the Personal Property Securities Act, a piece of legislation that set up the Personal Property Securities Register.

How does the Personal Property Securities Register work?

The PPSR or the Personal Property Securities Register is like an online noticeboard of all of personal property interests in New Zealand. Each interest is registered through an online application.

How do I register an interest in personal property on the PPSR?

You can register an interest in personal property by firstly setting up an online services account with the Companies Office. Next, you need to register your business as a secured party group. Finally, you must complete an online financing statement registration.

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