Protect your ideas and intangible assets

The PPSR is a national online government register where businesses can register their security interest in a physical or intangible asset.

A security interest can arise when personal property is used to secure payment or performance of an obligation. Registering a security interest on the PPSR lets others know about your interest in the property and may help protect your position if the other party does not meet their obligations or becomes insolvent. It may also give you priority over other creditors who claim an interest in the same property.

Important note: The PPSR records security interests, not ownership.

Registering on the PPSR does not prove ownership in property. It records that a person or business claims a security interest under a legal arrangement.

A security agreement is an agreement (or clause within an agreement) that creates a security interest in personal property. It is the legal arrangement that supports your PPSR registration and may protect you if the other party does not meet their obligations, such as failing to pay you.

Common examples of security agreements include:

• Contracts (such as distribution or franchise agreements)
• Terms of trade or invoice terms containing a Retention of Title clause
• Licensing agreements (covering intellectual property or brand rights for example a licensing agreement to use your designs on a variety of products)
• Written consignment arrangements for artworks (for example Indigenous artworks consigned with a gallery or dealer).

Intangible assets describe property that you can’t see and feel including accounts, copyrights and trademarks.

Tangible assets describe property that you can see and feel, including motor vehicles, machinery, watercraft and livestock. 

Land and fixtures are generally not personal property and are not registered on the PPSR.

Many businesses confuse ownership of intellectual property with registration of a security interest.

IP Australia is where you register and prove ownership of your intellectual property (such as trademarks, patents and designs).

The PPSR is where you register a security interest in that intellectual property when it is used in a commercial arrangement (for example, licensing your brand or software).

A properly registered security interest may:

• Help you to Get paid first if a customer goes broke
• Protect your brand, designs, and software
• Secure your contracts and licensing arrangements
• Put other on notice that you claim a security interest in the property.

Creative Business:

Protected their designs and brand by registering rights under a licensing agreement to protect their work until their clients paid.

Service Provider:

Registered unpaid invoices and contract rights under their Terms of Trade or General Security Agreement to reduce losses if a customer becomes insolvent.

Growing Brand:

Registered their artwork designs to safeguard their intellectual property under a licensing agreement.

An Indigenous artist licensed a series of original artwork designs to a national homewares company for use on textiles, stationery and giftware.

Under the licensing agreement, the company could use the designs commercially and pay royalties to the artist. The agreement also provided that the rights to use the designs would revert to the artist if royalty payments were not made or if the company became insolvent. This reversion right created a security interest in the intellectual property. The artist registered the security interest on the PPSR, putting others on notice of their interest in the intellectual property.

Two years later, the company entered external administration and ceased making royalty payments. Because the artist had both a valid security agreement and a PPSR registration, they were able to assert their rights in the artwork designs ahead of unsecured creditors and seek to recover control of the intellectual property in accordance with the agreement.

Why it matters:

• The value of Indigenous artwork often extends beyond the physical artwork itself and includes the copyright, designs and licensing rights associated with the work
• A licensing agreement can be structured so that intellectual property rights revert to the creator if specific obligations are not met. Those reversion rights may give rise to a security interest.
• You need both a security agreement and a PPSR registration to effectively protect a security interest. Registration alone is not enough.

Did you know?

• Copyright is a form of intangible property that may be the subject of a security interest.
• The PPSR does not register ownership of intellectual property. It records security interests arising from a legal agreement.
• IP Australia and the PPSR serve different purposes: IP Australia records ownership of certain intellectual property rights, while the PPSR records security interests in those rights when they are used in commercial arrangements.

Lesson: If you are licensing Indigenous artwork designs, consider whether the agreement creates a security interest in the intellectual property. A properly drafted agreement combined with a PPSR registration may help protect your commercial interests if the other party fails to meet its obligations or becomes insolvent.

Outcomes are highly dependent on the facts and terms of the agreement. You may wish to seek professional advice from your accountant, financial adviser or lawyer.

Under the law, you can register security interests over assets you can’t physically touch, including:

• Intellectual property (trademarks, patents, copyright)
• Licences (software, brand licensing, some commercial rights)
• Accounts (rights to payment, for example, unpaid invoices)
• Designs (blueprints, creative works)

You can register ownership of IP on the PPSR - only a security interest that is supported by a legal agreement.

Some licences (such as taxi licences, fishing licences, or milk quota) may be eligible for PPSR registration -but not all.

• Some statutory licences are excluded by law and can`t be registered
• Others can be registered if:
  • the licence can be transferred, and
  • the regulator does not have full discretion over transfers or renewals

Tip: Always check with the issuing authority to confirm if your licence can be registered, or seek professional advice if you are unsure whether a licence can support a security interest.

Registering on the PPSR is straightforward, but getting the details right is important.

Step 1: Have a Security Agreement

Before you register, make sure you have a valid security agreement. Reger to the section “What is a security agreement?” above.

Step 2: Create your PPSR Account

Before you start your registration, you’ll need:

• A PPSR account, and
• A Secured Party Group (SPG) which identifies you or your business as the secured party

You can set these up at Set up your PPSR Account.

Step 3: Start your application

Log in to your PPSR account and select Create a registration.

Tip:

• You must register intangible and physical collateral separately.
• Each registration can only include one collateral class.
• If your security agreement covers both, you’ll need two registrations.

Example:

A supplier leases coffee machines (physical/tangible goods) to a café and licenses their brand name (intellectual property) to a cafe.

• Coffee machines fall under Tangible Property – ‘Other Goods’.
• The brand name falls under Intangible Property – ‘Trade Mark’.

These assets require two separate PPSR registrations to ensure both interests are legally protected.

Step 4: Choose Collateral Type

For most small business assets, select Commercial Property.

Step 5: Pick the Collateral Class

On Step 2 of 6, choose the collateral class from the list.

For intangible property, options include:

• Account (unpaid invoices)
• General intangible (broad rights)
• Circuit layouts or plans
• Copyright
• Design
• Patent
• Plant breeder’s right
• Trade mark

Other categories include:

• Tangible property: motor vehicle, watercraft, aircraft, agriculture, other goods
• General property: All present and after-acquired property
• Financial property: Chattel paper, negotiable instrument

Important: For some intangible classes (such as trademark, copyright, and patent), you’ll need the issuing authority number. This can be the registration number or pending application number from IP Australia.

Step 6: Enter Grantor (customer) Details

This is where you enter your customer’s information.

• For businesses, use the Australian Company Number (ACN) or Australian Business Number (ABN).
• For individuals without an ABN (including sole traders), use the full legal name and date of birth.

Getting this right is critical. Incorrect grantor details can make your PPSR registration invalid and ineffective.

Step 7: Review Carefully

Before you submit, double-check everything is correct, particularly:

• Grantor information, and
• Collateral class and description
• Registration period

Correct grantor and collateral details are critical and cannot be changed later. Error may result in your registration not being valid or effective, and you may need to start again and pay another fee.

Step 8: Pay and Submit

Fees start at $6. Once paid, your registration on the PPSR is live.

Visit How to register your security interest on the PPSR and start your registration today.

This case study and the fact sheet is designed to provide general guidance only. It may not apply to your specific circumstances and should not be relied upon as professional advice. You may wish to seek independent professional advice from your accountant, financial adviser, or lawyer to ensure the information is appropriate for your situation.

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