Collateral classes

What is collateral?

Collateral is personal property to which a security interest has attached. For the purposes of registering the security interest in PPSR, it is the personal property described in the registration.

What is the collateral type?

Registrations on the PPS Register require the identification of the collateral type. The collateral type describes whether the property is held for a commercial or consumer purpose. Property will only be consumer property if it is held by an individual solely for private use. Property held by a sole trader with an ABN and used wholly or partly for their business would not be consumer property.

What is the collateral class?

A registration on the PPS Register also requires the selection of a general description of the property covered by the registration; this is known as the collateral class. The PPS Register separates the collateral classes under four broad categories: Tangible property, General property, Intangible property and Financial property. These four categories each contain a number of classes including sub-classes which are described below.

Do I have to describe the collateral in the ‘free text’ field?

Depending on the collateral class you select, you may be able to provide a further detailed description of the collateral in the free text field. For example, if the collateral class ‘other goods’ is selected, you may choose to include additional information about what type of goods is covered by the registration; for example ‘pine furniture’. A description cannot exceed 500 characters.

A further description in the free text field is mandatory for the collateral class ‘all present and after‑acquired property – with exceptions’. The free-text field must be used to describe the exceptions. In all other collateral classes a description is optional. However, it will assist anyone searching the PPSR for security interests over particular personal property if the description of the property makes it clear what property is covered by the security interest. A clear description will also assist the secured party if it means they do not have to provide additional information upon request by a searcher.

Tangible property

Tangible property includes the collateral classes ‘motor vehicle’, ‘watercraft’, ‘aircraft’, ‘agriculture’ and ‘other goods’.

Motor vehicle

As from 1 July 2014, an amendment to sub-regulation 1.7(2) of the Personal Property Securities Regulations 2010 narrowed the definition of motor vehicle for the purposes of the PPS Act. The definition applies to security interests (including PPS Leases) entered into on or after 1 July 2014. This will normally include, for example, leases entered into on or after 1 July 2014 even if they involve terms established under an earlier general agreement with a lessor.

Regulation 1.7(3) did not change, so some types of property with a serial number and wheels that are built to be towed at more than 10km/h are still a motor vehicle. Examples include caravans and trailers.

The collateral class of ‘motor vehicle’ may describe a car, truck, motor bike, tractor, trailer, caravan or other property that has a unique serial number and:

is built to be propelled wholly on land by a motor that forms part of it (but not if it runs on rails, tram lines or other fixed path) and has one or more motors with total power greater than 200 W and is  capable of a  speed of at least 10km/h, or
is capable, when being towed or attached to a motor vehicle, of travelling at a speed greater than 10 km/h and is a piece of machinery or equipment that is equipped with wheels and designed to be attached to or towed by a motor vehicle.

When the collateral type selected is consumer property, a serial number must be included; it is optional for commercial property. The relevant serial numbers are, in the following order of preference, the vehicle identification number (VIN), the chassis number, or the manufacturer's number.


‘Watercraft’ as a collateral class may describe a boat, ship or other vessel (other than a seaplane) that is intended to be used on water and has an official number issued by the Registrar of Ships, or a hull identification number (HIN). The inclusion of these numbers in a registration is mandatory if the watercraft is consumer property and optional if it is commercial property.


The collateral class of ‘aircraft’ is made up of four sub-classes: ‘aircraft engine’, ‘airframe’, ‘helicopter’ and ‘small aircraft’. A registration in respect to aircraft will always require the identification of a sub-class and the inclusion of a serial number. Aircraft engines, airframes and helicopters must be described by the manufacturer’s number, name and generic model designator. A small aircraft is described by the nationality and registration marks assigned to it under the Chicago Convention (for example VH-ABC).


‘Agriculture’ contains two sub-classes: ‘crops’ and ‘livestock’. Crops as a sub-class refer to crops, such as wheat or fruit, which have not been harvested. Livestock covers animals including alpacas, cattle, fish, goats, horses, llamas, ostriches, poultry, sheep, swine and other animals. Livestock also includes the unborn young of those animals and products, such as wool, while they are still part of the animal. A registration may be made against one of these sub-classes or against agriculture as the parent class to cover both.

Other goods

Other goods’ may be selected as a collateral class to describe all other tangible property that cannot be described by the above collateral classes or as part of all present and after acquired property. This may include art, machinery, or jewellery.

A registration describing the collateral class as ‘other goods’ may further describe the collateral in the free text field.

General property

All present and after‑acquired property – no exceptions

This collateral class is used to describe a security interest in all personal property that the grantor has an interest in at the time of registration as well as property that may be acquired by the grantor after the registration is made.

All present and after‑acquired property – with exceptions

This collateral class is used to describe a security interest in all personal property that the grantor has an interest in at the time of registration as well as property that may be acquired by the grantor after the registration is made, with the exception of any property described in free text field. A description of the property that is not subject to the security interest is mandatory.

Intangible property

Intangible property is any property that is not tangible or financial property. It is made up of the sub-classes ‘account’, ‘intellectual property’, and ‘general intangible’. Intellectual property can be described by further sub-classes. 


‘Account’ describes property that is a monetary obligation that arises from the sale, lease or other disposal of property or from the granting of a right or the provision of services in the ordinary course of business. Example: book debts.

General intangible

General intangible is a sub-class intended to be used to describe all other intangible property that is not an account or intellectual property. This sub-class may used to describe property such as contractual rights licences and ADI (authorised deposit-taking institution within the meaning of the Banking Act 1959 (Cth) accounts.

Intellectual property

‘Intellectual property’ under the PPSA only covers certain specific types of intellectual property” ‘copyright’, ‘design’, ‘patent’, ‘plant breeder’s right’, ‘trade mark’ and ‘circuit layouts’. It also covers licences over these types of IP.

All of the further sub-classes, with the exception of copyright and circuit layouts, must be described by serial number when they are held by consumers. The relevant serial number for each type of intellectual property will generally be the number issued by IP Australia, or, where one has not been issued, the application number issued by IP Australia. The inclusion of serial numbers is optional when the intellectual property is commercial property.

For any intellectual property that is personal property but does not fall under the definition in the PPSA, ie under one of the specific types mentioned above, it can be registered as ‘intangible property’.

Financial property

The collateral class ‘financial property’ is made up of the sub-classes ‘chattel paper’, ‘currency’, ‘document of title’, ‘intermediated security’, ‘investment instrument’ and ‘negotiable instrument’.

Chattel paper

‘Chattel paper’ describes a document or documents, including in electronic form, which evidences both a monetary obligation and a security interest in, or lease of, specific goods. Examples include hire-purchase agreements, rental agreements, or conditional sales agreements.

This describes a document or documents, including in electronic form, which evidences both a monetary obligation and a security interest in, or lease of, specific goods. Examples include hire-purchase agreements, rental agreements, or conditional sales agreements where a security interest is granted in the agreements themselves.


This collateral sub-class describes collateral that is the money of Australia or any other country.

Document of title

A description of ‘document of title’ is intended to cover a document issued by or addressed to a bailee that covers goods in the bailee’s possession and states that the goods identified will be delivered to a person specified or to the bearer.

Intermediated security

This sub-class is intended to describe the rights of a person in whose name an intermediary maintains an account to which interests in financial products are credited or debited or an account that is a record of holdings and transfers of interests in financial products. An example of an ‘intermediated security’ is a Clearing House Electronic Subregister System (CHESS) security.

Investment instrument

An ‘investment instrument’ may describe the following financial products or a combination of these products:

  • a share in the body, or a debenture in a body
  • a derivative
  • a foreign exchange contract that is not a derivative
  • an interest in, or a unit in an interest in, a managed investment scheme
  • a unity in a share in a body, and
  • a financial product traded on the financial market that is operated in accordance with an Australian market licence or exempt from the operation of Part 7.2 of the Corporations Act 2001.