Amendments To Ontario's Conflict Of Laws Rules Will Require Changes To Documentation And Registration/Search Practices

Secured parties that make loans on the security of receivables and motor vehicles, that purchase receivables under securitization or factoring arrangements or that provide financing pursuant to motor vehicle leases or conditional sale agreements (each, a Secured Party) will need to take proactive action as a result of amendments to the Personal Property Security Act (Ontario), which come into force on December 31, 2015.

On that date, the amendments will introduce new rules for determining where a debtor is deemed to be located when applying the Ontario conflict of laws rule that is most relevant to such Secured Parties. These amendments will require that changes be made to such Secured Parties' registration and search practices and that their documentation be reviewed and, if necessary, revised to ensure that the representations and covenants in their documentation are broad enough to deal with these new rules.