The Account Control Agreement Collateral is a crucial document in Australian secured financing arrangements, used when a borrower pledges its deposit accounts as collateral for a loan or other financial obligation. This agreement is particularly important under the Personal Property Securities Act 2009 (Cth) as it helps establish "control" over the financial asset, which can provide the secured party with a higher priority security interest. The document is typically used in conjunction with broader security arrangements and sets out the specific mechanisms by which the secured party can exercise control over the account, the bank's obligations to comply with the secured party's instructions, and the account holder's permitted activities. It includes detailed provisions for account operation, events of default, and the rights and obligations of all parties involved.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Your data doesn't train Genie's AI
You keep IP ownership of your docs
Alternatively...
1. Parties: Identifies the three key parties: Account Holder, Secured Party, and Deposit Bank
2. Background: Sets out the context of the security arrangement and existence of the relevant account(s)
3. Definitions and Interpretation: Defines key terms and establishes interpretation principles
4. Account Control and Security Interest: Establishes the security interest and control arrangements over the account
5. Bank's Rights and Obligations: Details the deposit bank's obligations regarding account operation and control instructions
6. Account Holder's Rights and Obligations: Specifies permitted activities and restrictions on the account holder
7. Secured Party's Rights: Outlines the secured party's rights to give instructions and control the account
8. Operation of Account: Details day-to-day operational procedures, including processing of instructions and timing
9. Events of Default: Defines events triggering enhanced control rights or enforcement
10. Representations and Warranties: Standard representations from all parties regarding capacity and authority
11. Bank's Liability and Indemnity: Limits bank's liability and provides indemnification for acting on instructions
12. Fees and Expenses: Sets out fee arrangements and responsibility for costs
13. Termination: Specifies conditions and process for terminating the agreement
14. General Provisions: Standard boilerplate provisions including notices, amendments, governing law
1. Securities Intermediary Provisions: Required if the account holds securities rather than just cash
2. Foreign Currency Provisions: Required for accounts holding multiple currencies or foreign currency
3. Electronic Communications: Detailed provisions for electronic instruction methods and security procedures
4. PPSA Specific Provisions: Additional provisions specifically addressing PPSA requirements and procedures
5. Regulatory Compliance: Special provisions required for regulated entities or specific regulatory requirements
6. Multiple Account Provisions: Required when agreement covers multiple accounts or sub-accounts
7. Jurisdiction-Specific Provisions: Required when parties are in different jurisdictions or for cross-border arrangements
1. Account Details Schedule: Lists all accounts covered by the agreement, including account numbers and types
2. Authorized Persons: Lists individuals authorized to give instructions for each party
3. Form of Notice of Control: Template for notices establishing control under PPSA
4. Operating Procedures: Detailed procedures for account operation and instruction processing
5. Fee Schedule: Details of all applicable fees and charges
6. Form of Instructions: Standard forms for various types of account instructions
7. Notice Details: Contact details and notice requirements for all parties
Is an Account Control Agreement Collateral legally binding in Australia?
Yes, an Account Control Agreement Collateral is legally binding in Australia when properly executed under the Personal Property Securities Act 2009 (Cth). The agreement creates enforceable obligations between the borrower, lender, and bank, establishing the secured party's control over deposit accounts. It must comply with PPSA requirements and banking regulations under the Banking Act 1959 to be fully effective.
Do I need a lawyer to draft an Account Control Agreement Collateral in Australia?
While not legally required, it's highly recommended to engage a lawyer experienced in Australian security law and PPSA compliance. The agreement involves complex interactions between banking regulations, personal property securities law, and commercial lending requirements. A lawyer ensures proper drafting, compliance with the Personal Property Securities Act 2009, and protection of your interests as either lender or borrower.
How does an Account Control Agreement differ from a general security agreement in Australia?
An Account Control Agreement specifically establishes control over deposit accounts as collateral, while a general security agreement creates broader security interests over various assets. Under the PPSA, control agreements provide stronger priority rights over bank accounts compared to general security interests. The control agreement involves the bank as a third party, whereas general security agreements typically only involve the borrower and lender.
Authors
Find the document you need
Quality Control Agreement
An Australian-compliant Quality Control Agreement establishing quality standards, testing procedures, and compliance requirements between contracting parties.
Download
Account Control Agreement Collateral
An Australian law-governed tripartite agreement establishing control over deposit accounts used as collateral in secured financing arrangements.
Download
Genie’s Security Promise
Genie is the safest place to draft. Here’s how we prioritise your privacy and security.
Your data is private:
We do not train on your data; Genie’s AI improves independently
All data stored on Genie is private to your organisation
Your documents are protected:
Your documents are protected by ultra-secure 256-bit encryption
We are ISO27001 certified, so your data is secure
Organizational security:
You retain IP ownership of your documents and their information
You have full control over your data and who gets to see it
