The PPSA has a much broader application than the company charges system under Chapter 2K of the Corporations Act 2001 (Cth). The Corporations Act company charges system only applied to security interests granted by Australian companies and registrable Australian bodies (broadly, Australian bodies that require registration under the Corporations Act).

By contrast, the PPSA will apply to all security interests granted by foreign companies over personal property located in Australia, whether or not the foreign grantor is registered to carry on business in Australia. Likewise, an Australian company that grants security over collateral located overseas will attract the application of the PPSA.

In this way, many transactions will end up being registered or otherwise perfected in both Australia under the PPSA, and other foreign jurisdictions in which collateral or the grantor is located or has a connection.

For example, assume a foreign entity or person grants a security interest over collateral that is located in Australia. The security interest must be registered or perfected under the PPSA. In this case (foreign grantor, collateral located in Australia) it would be strongly advisable also to take security in the foreign jurisdiction of the grantor, which will be either necessary or advantageous if insolvency proceedings commence against the grantor in the grantor’s home jurisdiction.

The result is that there will be many double registrations where a security interest has a foreign element.