Buyer's helper

Consumer protection provided by various Commonwealth, state and territory registers of encumbered assets is about to change. Most of those registers will be folded into the new, national Personal Property Securities (PPS) Register.

Second-hand car buyers used to going to state-based REVS websites to see whether a car has any debt owing on it will be able to check the details of vehicles registered anywhere in Australia. The same will apply to a wide range of personal property.

The Personal Property Securities Act takes effect on October 1, creating a single set of rules and a single, national register. Personal property is any form of property other than land, buildings or fixtures that form part of that land. It can include cars, boats, art, machinery and crops, as well as intangibles such as intellectual property and contract rights.

Registers that will migrate include the Australian Securities and Investments Commission's register of company charges, state registers of encumbered vehicles, state bill-of-sale registers and state crop and livestock mortgage registers, the fisheries register and Australian register of ships.

The new register will also provide access to some information not compiled by government bodies.

The National Exchange of Vehicle and Driver Information System data on stolen and written-off vehicles will be on the PPS Register.

The risk a consumer takes if they buy an asset that has debt owing on it is that it could be repossessed by the lender and the consumer could be out of pocket, as well as lose the goods.

It is not just unpaid debt that can cause problems.

The PPS Register will show if an asset is subject to a proceeds-of-crime order, court orders or hoon lien registration.

A partner at the law firm Langes+, David Jacobson, says the change is good news for consumers.

''People these days are mobile and there is no sense in having asset searches set up on a state-by-state basis,'' he says. ''This is going to make it much more convenient for people to search before they buy something.''

Jacobson says there are other benefits. People will be able to find their own records to see if there are any security listings and they will have the right to ask for mistakes to be corrected.

He says all consumers should learn how to use the PPS Register. ''If you do a search and you don't find evidence of a security charge over the asset you are buying, you are protected against a creditor who later claims the asset is encumbered,'' he says.

The principal solicitor of the NSW Consumer Credit Legal Centre, Katherine Lane, says there are always privacy concerns about registers such as this. ''It is going to be a bigger database and therefore more likely to be used for the wrong purposes,'' she says.

Lane is also concerned that it will be administered by the Insolvency and Trustee Service Australia (ITSA), which regulates bankruptcy activity.

''ITSA does not have any experience in dealing with consumers,'' she says. ''But if there are going to be problems they will emerge in practice. We will wait and see how it works.''

How the register will work

• From October 1, a consumer wanting to check whether personal property, such as a used car, has a debt owing on it - or is in any other way encumbered - must consult the Personal Property Securities (PPS) Register.
• The primary access to the PPS Register will be via the internet, although there will also be a call centre. The PPS Register will charge a fee for searches.
• The rules for searching the PPS Register are similar to those that now apply to searches of other registers, for example the Register of Encumbered Vehicles (REVS).
• In most cases, the consumer will do a serial-number search - a vehicle identification number or chassis number for motor vehicles, a hull identification number if it is a boat, or, more generally, the number of a manufacturer.
• Searches can also be done by providing the grantor's details. A grantor is an individual, company or other entity that grants a security interest over personal property to another party.