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The revised legislation on Retention of Title (ROT) is delayed again and now expected to begin in early 2012
The revised legislation on Retention of Title (ROT) is delayed again and now expected to begin in early 2012
 










New laws to affect jewellers

New laws that cover goods supplied and sold on consignment or ‘appro’ will affect jewellery retailers and suppliers.
The proposed commencement date for the new Personal Property Security (PPS) legislation has been delayed until early 2012. While the Attorney General hasn’t yet revealed an exact date for its commencement, the rejigged laws regarding goods on consignment are rumoured to commence on February 1 next year.

The new legislation was set to take effect on October 31 this year, replacing the existing Retention of Title (ROT) laws and once implemented it forces jewellery suppliers to register security interest on the PPS website if they wish to preserve title over stock supplied on consignment.

This is the second time the revised legislation has been postponed, with its original start date slated for May 1 this year.

While technological issues have been cited as the cause of the delay, some industry members believe there are other matters behind the hold-up.
 
Colin Pocklington, director for the Jewellers Association of Australia (JAA) believes the lack of industry awareness could have caused the delay. Pocklington told Jeweller he wasn’t shocked by the announcement.

“I would be surprised if a quarter of suppliers to the jewellery industry knew about the legislation and what they need to do to maintain retention of title over their goods,” Pocklington said.

As previously reported by Jeweller, existing ROT laws concern the protection of unpaid-for stock sent to stores on consignment. Many suppliers have ROT clauses built into credit agreements and invoices, allowing them to retain the title on goods not yet paid for.

When the new act commences, any ROT clauses suppliers previously had in place will no longer be binding.

In order to preserve title over consigned stock, suppliers will need to register security interest and goods supplied on consignment, appro or bailment via the PPSR website.

Pocklington noted that the preparation involved in readying a business to adhere to the new scheme is extensive. Suppliers will need to amend credit applications, issue revised credit application documents to all its existing customers, as well as register security interests for each customer.

“There is quite a bit required with new credit agreements and identifying all customers in accordance with the legislation,” Pocklington added.

Retailers, on the other hand, should have little involvement with the new register. In fact, the Government says that the new PPS Act can benefit small businesses by increasing available avenues of finance.

According to a Government statement: “The current arrangements for determining whether personal property is subject to a security interest restrict the ability of businesses to use their personal property as security for credit.”  

However, the new legislation will require retailers to deduct the value of any unpaid goods from their stock, potentially decreasing asset value.

JAA members can download a summary outlining the processes of the register from its website.

More reading:
Legal reforms that jewellers need to know
Fair Work backtracks on minimal shift retail laws
New warranty law could trip up jewellers









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Sunday, 18 August, 2019 09:47am
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