A fair trade
October 13, 2010 | BY
clpstaff &clp articlesAs an option for raising cash, IP pledge financing is becoming increasingly more attractive. However, as companies begin to swap their IP rights for loans from banks or financial institutions, there are several issues both sides need to be aware of
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Intellectual property pledge financing is a financing method where an intellectual property (IP) rights owner creates a pledge over property rights of such lawful, valid and transferable intellectual property rights as patents, registered trademarks and copyrights. These rights are offered in return for a loan from banking and financial institutions, and the principals are repaid with accrued interest.
The State Intellectual Property Strategic Outline (国家知识产权战略纲要), which was promulgated by the State Council on June 5 2008, raised the proposal of introducing and guiding enterprises to realise the market value of their intellectual property rights by means of transfers, licences and pledges. Following this, the State Intellectual Property Office together with local governments are issuing a series of rules to promote intellectual property pledge financing.