The Road to Securitization of Intellectual Property

The Road to Securitization of Intellectual Property

Definition of Securitization of (I) Intellectual Property

Asset securitization refers to the sale of illiquid assets with predictable income by issuing securities in the capital market to obtain financing, thereby increasing the liquidity of assets.

Intellectual property securitization is one of the asset securitization, which refers to the issuance of asset-backed securities for financing based on the future licensing fees of intellectual property. Its specific operation is to combine the intellectual property rights with poor liquidity, but stable and predictable income, separate and reorganize the risk and income elements through structural design, and combine certain credit enhancement measures to make it meet the credit rating required by the market, and issue securities for sale in the capital market to raise funds. The biggest point of intellectual property securitization is that it can not only obtain the required funds in the capital market by issuing bonds, but also retain the autonomy of intellectual property rights.

Participants in the securitization of intellectual property rights include promoters (original equity holders), ad hoc carriers (SPV), investors, trustees, service providers, credit rating agencies, credit enhancement agencies, liquidity providers, etc. Among them, the original intellectual property right holder transfers the intellectual property assets he owns to the ad hoc institution in the form of "real sale". The ad hoc institution obtains the only transfer right of intellectual property rights and issues securities based on the cash income that the intellectual property rights will generate. The only transfer right can ensure that the income generated in the future will be used to repay the principal and interest of investors, and the surplus income is value-added income. If the technology has not yet applied for patents and other intellectual property rights, the ad hoc body may also act as an agent for the intellectual property application and bear the application costs and the annual maintenance costs of the intellectual property rights, and the ad hoc body and the intellectual property rights holder shall share the proceeds according to a certain proportion.

The securitization of intellectual property rights not only successfully converts the intangible asset of intellectual property rights into the cash flow required for enterprise development and R & D and innovation, but also activates the financial capital market, which is one of the important manifestations of financial liberalization.

The main cases of securitization of (II) assets.

The world's first famous example of intellectual property securitization was by rock star David Bowie in1997Created in 2010, its issuing company is Pullman Corporation of the United States and its asset base is David Bowie.25Record near.300The proceeds from the copyright of the first song, which is7.9%of10-year bonds, total raised5500$10,000, the offering was rated by Moody's as"3A"Level.

In addition to copyright, it is also common to use patent proceeds as the underlying asset. United StatesRoyalty PharmaThe company focuses on the field of pharmaceutical patent licensing.2003A number of pharmaceutical companies developed in13The proceeds from the patent licensing of the drug are used as a pool of funds, which is structured by Credit Suisse Group for its transactions,MBIAProvide insurance for it and successfully raise it.2.25Billions of dollars.

2003at the beginning of the year,Guessto14A trademark license contract was issued on the basis of a trademark license contract.7500$10,000 in bonds, for a period8year,JPMorgan underwrites securities, and professionals say the securitization transaction sets the standard for the securitization of trademark rights in Power ah.

With the help of asset securitization as a financial means, intellectual property securitization has been effectively developed in music, film, medicine, semiconductor and many other industries, helping light asset companies to raise rich funds. Securitization of intellectual property assets has achieved rapid growth in the United States.

(III) the development of asset securitization in China

Recently, the Ministry of Finance and the State Intellectual Property Office approved the selection of Haikou City.2018Pilot cities for the construction of intellectual property operation service systems in. central finance to each pilot city2Billions of financial support, focusing on promoting the construction of intellectual property protection system, focusing on the cultivation of high-value patents in industries, promoting the protection and application of intellectual property rights of innovative subjects, and cultivating intellectual property operation service formats.

In fact, compared with the selected pilot cities such as Nanjing, Hangzhou, and Guangzhou, Haikou's intellectual property operation capabilities are not outstanding, and the basic work is relatively weak. It is precisely this that Haikou will implement more proactive innovation and exploration to realize its The possibility of a breakthrough in intellectual property securitization. This year4The "Guiding Opinions of the Central Committee of the Communist Party of China and the State Council on Supporting Hainan's Comprehensive Deepening of Reform and Opening-up" issued in January clearly stated that it would explore the securitization of intellectual property rights and improve the credit guarantee mechanism for intellectual property rights. At the recent Wuzhishan Forum on Intellectual Property Rights in Hainan Province, held in Haikou,70A number of industry experts and scholars jointly issued the "Hainan consensus", which further clearly pointed out that the securitization of intellectual property rights should be turned into an innovation driven engine, creating an efficient integration channel of capital and technology, so as to "break away from the virtual into the real", directly enter the field of innovation, and provide high-efficiency and low-cost diversion channels.

In recent years, the construction of my country's intellectual property operation system has continued to accelerate, and intellectual property pledge financing and insurance business have developed steadily, which provides an important foundation for exploring intellectual property securitization.

In the view of relevant professionals, the current domestic intellectual property operations are still stuck in the traditional display and promotion, evaluation and consultation, etc., and it is difficult for innovation entities to fully and effectively serve the real economy through the current model, and intellectual property securitization What to do is to revitalize99.9%"Precipitation value" to form a "real trillion-dollar market".

While the outlook is bright, the road is tortuous. There is still a long way to go to promote the implementation of intellectual property securitization in China. On the whole, the successful cases of intellectual property securitization have certain commonalities: first, high-quality assets suitable for securitization are the foundation, and the underlying intellectual property rights must have clear ownership, stable rights, and clear income rights; secondly, a certain scale is needed. Intellectual property asset portfolio to make it meet the requirements of securitized assets is an effective support for asset securitization; finally, the main push and credit enhancement behind well-known institutions, refers to meeting the rating requirements for securities issuance and is the risk protection of securitization.

according to the statistics released by the state intellectual property office,2016In total, our country acceptedpatent application for invention133.9Ten thousand pieces, a total of authorized invention patents40.4Ten thousand pieces; as2016At the end of the year, the total number of domestic invention patents in China110.3After the United States and Japan, it has become the third country in the world with more than one million domestic invention patents. The huge patent increment and cumulative total, as well as the increasingly active patent operation behavior, provide a solid foundation for the securitization of patents in China.

However, in the process of practice, there are still some problems in the securitization of intellectual property rights. First of all, although my country's intellectual property rights have ranked high in terms of quantity and scale, their quality still needs to be improved, and the combination of intellectual property value and core business income needs to be improved; secondly, the efficiency of intellectual property operation and transformation in my country is not high, and professional service institutions Lack, the value of intellectual property needs to be explored and improved, and the ability to evaluate the value of intellectual property needs to be further strengthened; again, the protection environment of intellectual property rights needs to be improved, and the illegal cost of infringement should be further increased. In addition, asset securitization itself is still in the development stage in China, with limited scale and volume. Intellectual property securitization, as a new subdivision category, is complementary to the development of asset securitization and is inseparable..

With the continuous innovation in the field of science and technology in China, as well as the growth of the intellectual property operation market, China will make a difference on the road of intellectual property securitization.