PMSI’s and trust companies, to ABN or to ACN

Credit managers, if your customer trades its business under a trust structure, please be sure to register your PMSI* based on your customer’s ABN, not ACN.

If your customer fills out its credit application with you and only supplies its business name and/or ABN, please be sure to run (at least) a free ABN look-up** to make sure the customer is not trading its business via a Pty Ltd entity or trust structure.

If the former, then the PMSI must be registered against the ACN, unless, like in the latter, the corporate entity is trustee of a trust.

Why is this important?

According to a case last year, Re Onesteel [2017] NSWSC 21, the registration of a PMSI over the ABN of a Pty Ltd entity was a “seriously misleading defect”. 

I am seeing more and more of these defects lately, and so it pays to review your PPS registrations with your lawyers now!

* PMSI’s = purchase money security interests or ROT

** Google ‘ABR’ 

For further information, please feel free to send me your questions in the comment box below.

#SVVoidables

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