Parliament

Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 

Greater Certainty For Personal Property Security

Hon Max Bradford
Minister for Enterprise and Commerce

Media Release
October 10th, 1999

GREATER CERTAINTY FOR SECURITY INTERESTS IN PERSONAL PROPERTY

The passing of the Personal Property Securities Bill will provide greater certainty in personal property transactions, Enterprise and Commerce Minister Max Bradford says.

The Bill was given its final reading in Parliament on 6 October.

Mr Bradford said the legislation would clarify the law and reduce transaction costs associated with giving and taking security interests in personal property.

It will also make it easier and cheaper for those seeking to deal with personal property to check whether the property is subject to a prior security interest.

“The Bill will provide greater flexibility to the business community, by enabling more personal property to be safely borrowed against. This should increase access to credit for consumers and businesses,” Mr Bradford said.

The Bill affects all security interests in personal property, such as cars, computers and boats, but doesn’t apply to land. A security interest over these items secures the payment of money, or the performance of an obligation.

Some of the main features of the Bill are:

 uniform rules that apply to every transaction that in substance secures payment or performance of an obligation;
 the provision of ways for determining priority between competing security interests;
 default provisions for the enforcement of security interests in personal property other than consumer goods;
 the establishment of a centralised personal property securities register, based solely on the internet, which will make it easier and cheaper to find out about an existing security interest.

Media contact:
Jeremy Kirk, Press Secretary, Max Bradford (04) 471-9836 or 025 424 565


Frequently Asked Questions


Q: What is personal property?

A: Personal property is property other than land. This includes property such as motor vehicles, boats, computers, televisions and shares.

Q: What is a security interest?

A: A security interest is a right to use or sell personal property to recover money that has been loaned if it is not paid back. For example, if a person purchases a boat and a finance company lends that person the money to purchase the boat in return for payments being made to a particular timeframe and at a particular interest rate, the finance company has a security interest in the boat.

Q: What is wrong with the current law?

A: The current law is overly complex, inconsistent and inaccessible. At the moment there are many different pieces of law which deal with different types of personal property, different types of security interests, different types of debtor and different types of secured parties. Also, there is no integrated register of security interests in personal property which makes it time consuming and expensive to find out about an existing security interest.

Q: How does the Personal Property Securities Bill fix this?

A: The Bill provides a set of rules dealing with all security interests in personal property. These rules remove the arbitrary distinctions which exist in the current law and make it easier for people dealing with security interests in personal property to know what their rights are.

The Bill also establishes a single, wholly internet-based register of security interests in personal property. This register will provide a cheap and easy way to find out about an existing security. This register will be administered by the Ministry of Commerce.

As a result, the Bill reduces the risks associated with transactions involving personal property, and in particular, it reduces the risks to creditors lending on the security of personal property.

Q: How will this help the commercial world?

A: At the moment people seeking to buy personal property or lend money may not be able to find out about existing security interests. As a result a purchaser may seek a lower price, or the person loaning money may charge more interest, to take into account the risk that the property may not be able to be seized if the debtor defaults. The new register will enable people to easily, cheaply and effectively acquire knowledge of any registered security interest.

The Bill also sets out comprehensive rules for holders of security interests to know their rights as against other holders of security interests in the same property, and against consumers. This makes the law more accessible and certain and allows the business world to get on with business.

Q: How will this help consumers?

A: It is difficult for a consumer buying personal property to know whether they are getting clear title to the property. A person buying a car on the side of the road will not be able to tell whether the bank is owed money on it and may repossess it. Under the new Bill a consumer will be able to access the register of personal property securities on the Internet and find out quickly and cheaply whether the property they are about to purchase has a security interest over it.

The Bill also sets out rules for when a consumer automatically gets clear title, such as when they purchase a motor vehicle from a licensed motor vehicle dealer, or when they purchase goods of a value less than $2000 when the security interest was given.

Ends.

© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On Juggling Covid, And France’s Trump-like Populist


It is the age-old Covid problem. How to balance the needs for firms (and schools) to re-open against the need to protect public health. In the past, the balance has been struck by insisting that the best public health outcomes also deliver the best economic (and educational) outcomes. While that may still be objectively true, it is no longer a politically tenable position... More>>

Covid-19 & Education: NCEA And NZ Scholarship Exams To Proceed


NCEA and New Zealand Scholarship exams will proceed, including in areas where Alert Level 3 has been in place, Education Minister Chris Hipkins said today. “The New Zealand Qualifications Authority, Ministry of Education and Ministry of Health have been working together to ensure exams can be managed in a safe way, so students have the opportunity to demonstrate what they have learned... More>>





 
 

Ombudsman: Launches Investigation Into MIQ Booking System
The Chief Ombudsman Peter Boshier is launching a broad investigation into the Managed Isolation and Quarantine (MIQ) booking system after receiving hundreds of complaints... More>>

ALSO:



National: Launches Back In Business Plan

Leader of the Opposition Judith Collins has today launched National’s detailed plan to save livelihoods and unleash our economy in the face of the huge damage being wrought by the extended Covid lockdown... More>>

ALSO:


Pay Cheque To Pay Cheque: Half A Million New Zealanders Have No Savings
New findings from the Consumer NZ sentiment tracker found that 15% of New Zealanders had no savings, and a further 27% were anxious about their level of savings and would like to have more tucked away... More>>


Government: Mandatory Vaccination For Two Workforces

Large parts of two workforces critical to preventing the spread of COVID-19 will be required to be vaccinated, COVID-19 Response Minister Chris Hipkins said today. “Our education and health and disability workforces have done an incredible job throughout this pandemic to keep themselves and people safe,” Chris Hipkins said.... More>>


Green Party: Deeply Concerned Space Launches May Be Breaching Nuclear-free Laws

The Green Party is deeply concerned that space launches by Rocket Lab may be breaching nuclear-free laws, given our long-standing position as a signatory of the Nuclear Non-Proliferation Treaty... More>>


 
 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

InfoPages News Channels