The Personal Property Security Act and its Implementing Rules and Regulations
February 06, 2020
The Personal Property Security Act (“PPSA”) was enacted on August 17, 2018, to strengthen the secured transactions legal framework in the Philippines, and provide for the creation, perfection, determination of priority, establishment of a centralized notice registry, and enforcement of security interests in personal property (tangible and intangible), except aircraft and ships. The PPSA’s full implementation is conditioned upon the issuance of the relevant implementing rules and regulations and the establishment of a new registry (wherein security interests created under the PPSA may be registered). In this connection, the implementing rules and regulations of the PPSA (“PPSA Rules”) were published last November 18, 2019 and have become effective on December 3, 2019. However, the registry has not yet been established. Nevertheless, the PPSA Rules directed the Land Registration Authority to establish the registry within six months from the publication of the PPSA Rules.
The PPSA expressly repealed, amended or modified, among others, the provisions of the Chattel Mortgage Law (Act No. 1508) (specifically, Sections 1-16), the provisions of the Civil Code of the Philippines (Republic Act No. 386) (“Civil Code”) on mortgage and pledge (specifically, Articles 2085-2123, 2127, 2140-2141, 2241, 2243 and 2246-2247), and the registration of chattel mortgages under the Property Registration Decree (Presidential Decree No. 1529) (specifically, Sections 114-116).
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