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Charges at collateral registry will be low - CEO

Published:Friday | January 3, 2014 | 12:00 AM
Companies Office of Jamaica Chief Executive Officer Judith Ramlogan. - File

Chief executive officer of the Companies Office of Jamaica and Registrar of Companies, Judith Ramlogan, said the fees for using the Security in Personal Property registry, which began operations yesterday, will not be prohibitive.

The cost to register a notice will be less than J$1,500, she said in emailed responses to queries by the Financial Gleaner.

"Most of the other fees are below that," she said. "There will be no cost to register pre-existing charges (those in existence prior to January 2, 2014) provided that they are registered by September 2014, and there will be no cost to search the registry," she said.

"Certified search reports and extracts of the database will, however, attract fees," she said.

Ramlogan explained that the registry "will allow for all creditors who lend monies secured by personal property/movable assets to note their interests in that property in the registry."

Other creditors as well as the public in general will be able to search the registry to ascertain if property/assets have been used to secure other loans.

Information registered will include the name of the secured creditor, name of debtor and a basic description of the collateral. In most cases, registration of a notice will establish priority in the event that there is any competing claim for the property by two or more secured creditors.

In order to register charges existing before January 2, 2014, the Companies Office had asked financial institutions to submit all outstanding charges on or before December 23, 2013.

However, the Jamaica Bankers Association advised the Companies Office that its members would have grave difficulty in meeting that deadline and so the deadline was extended to Tuesday of this week.

Ramlongan said that those who made the deadline would have a higher priority in terms of having their bills of sale processed and converted to legal documents.

However, she explained that bills of sale, which come in during the 270-day transition period starting January 2, will all be given the same priority status.

Ramlogan explained that as of January 2, certain charges, notably bills of sale now registered at the Companies Office, will no longer be registrable there. Such charges will have to be registered at the new registry.

The new registry, also to be administered by the Companies Office, will be the repository of information on non-real estate assets being tendered as collateral for securing loans.

The existence of the registry is expected to result in increased access to loans for small, micro and medium-size enterprises.