Lien search (PPSA)
A lien search checks the provincial personal property security registry for security interests registered against a business’s assets. It reveals which equipment, vehicles or receivables are already pledged to a lender, and it is a standard step before any asset purchase closes.
Personal property security legislation lets a lender register its interest publicly, and a registered interest can generally follow the asset. A buyer who pays for equipment without checking may find a lender with a prior claim to it — and the buyer’s recourse is against a seller who has already been paid.
What a full search covers
- Registrations against the corporate name, and against any prior or trade names
- Registrations against individual owners where personal assets are involved
- Execution and judgment searches, which reveal enforcement against the business
- Corporate standing, confirming the company exists and is in good standing
- Tax arrears, which can rank ahead of ordinary creditors
Sources
This definition is checked against primary sources. Links were last confirmed on the dates shown.
- 01Canada Revenue AgencyGovernmentSelling a business
- 02Treadstone LawLegal commentaryExecution and Judgment Searches Before Buying a Business in Ontario
- 03Treadstone LawLegal commentaryChecking Corporate Status and Good Standing Before Buying an Ontario Business
- 04Treadstone LawLegal commentaryChecking for Outstanding CRA Debts Before Buying a Business in Ontario
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