Do lenders need to register charges?
It is advisable to register any charge immediately upon execution to protect it against later charges. Generally speaking unregistered charges are enforceable if an external administrator has not been appointed. In most circumstances, registered charges will have a priority over unregistered charges, even when the registered charges were taken out at a later date. Unregistered charges over assets are likely to be unenforceable against a liquidator, administrator and a trustee in bankruptcy. The Corporations Act sets out what types of charges over company assets must be registered, and the relevant state’s Bills of Sales Acts also sets out the requirements for securities over non-corporate assets. The government is bring in a new national registration regime to replace the separate state systems.
