Financing Strategy of Intellectual Property Securitization

Abstract: With the advent of knowledge economy and the Development of asset securitization, the securitization of intellectual property more seriously by the people. Compared with the traditional financing model, the securitization of intellectual property has its own unique advantages. This article describes the intellectual property securitization The basic theory, the intellectual property securitization transaction process, and the Development of intellectual property securitization in China made some reasonable suggestions.

Keywords:: intellectual property securitization financing Strategy
0 Introduction
Since 1997, the world's first intellectual property securitization - securitization since the emergence of music copyright, intellectual property securitization have been gradually recognized by the financial and intellectual property community, the future of WIPO as a "new trend." As a new financing instruments, intellectual property securitization not only help to fully exploit the intrinsic value of intellectual property rights and to promote intellectual property into real productive forces, but also allows sponsors to retain ownership of intellectual property in the case of early access to intellectual property rights future earnings, thereby avoiding the uncertainty of future earnings.

1, the basic theory of intellectual property securitization
1.1 The definition of the securitization of intellectual property securitization of intellectual property is usually defined as: sponsoring agencies (often innovative enterprises have intellectual property rights of its creditors or its derivatives (such as the right to authorize payment, transfer to a special carrier, then This special carrier to guarantee the assets, after re-packaging, credit rating, as well as credit enhancement on the market after the issue of negotiable securities, by the financing institutions that initiated the financial operations.

1.2 Characteristics of the securitization of intellectual property securitization of intellectual property after the financier retains ownership of intellectual property. This is for the financier, is of great significance. In the securitization process, were transferred to a special vector Securities of the assets, intellectual property rights is usually the authorization of others to obtain intellectual property rights of existing or future royalty returns (accounts receivable, rather than the intellectual property itself. In a securitization transaction, the promoters can hold onto, and manage intellectual property.

A bankruptcy-remote securitization of intellectual property mechanisms. Sponsors and issuers to ensure the financing of specific assets and sponsors and other assets of the issuer to separate from the legal, financial guarantees to ensure the sponsor or issuer of asset management from deterioration and recovery of other creditors, and the sponsor or issuer in bankruptcy cases not included in the estate. This way, the risks are greatly reduced.

1.3 The role of intellectual property securitization
1.3.1 improve the capability of independent innovation of enterprises and promote the construction of the current innovation-oriented country, China's ongoing construction of an innovative country, and building an innovative country is the main business. Therefore, enhancing independent innovation capability of enterprises is building an innovation-oriented country imperative. intellectual property securitization leverage the use of IP, allows companies to improve independent innovation capacity-building as their own strength, enhance the comprehensive competitiveness of the important channels through which a lot of money spent on product Development and service innovation.

1.3.2 Effective crack enterprises, especially high-tech enterprises financing difficulties companies face difficulties financing is a common problem, especially for SMEs in the start-up stage, it is a priority. Financing model is the current conventional mortgage loans, often requires a lot of mortgage assets, while small and medium enterprises in the start-up stage to no primitive accumulation, lack of collateral assets. intellectual property securitization financing of SMEs to open a breach, so that in the initial stage companies received funding.

1.3.3 reduce risk and maintain stability of the market economic order of intellectual property securitization products have the uncertainty of future earnings, investors can give tremendous benefits, but also hides a huge risk. Intellectual property securitization products often with high-tech nature, transcendence, but the potential value of such tests need to go through the market, whether accepted by consumers are still unknown. IP securitization can spread the risk of the sponsor to many investors, making the risk reduced, so as to maintain the market stability.

1.3.4 reduce overall financing costs, promoting high-tech achievements into our current conversion rate is very low high-tech achievements, there are a lot of good technology and patent lack of start-up capital and idle in the laboratory, the high threshold for blocking the high-tech financing Industrialization of the way. IP securitization financing provides a good model, reducing the financing costs, making the potential value of these fully tapped.


2 intellectual property securitization transaction flow analysis
2.1 The basic intellectual property securitization transaction process are mainly: �� intellectual property owners (the original interest in people, the promoters will be the future for a fixed period of intellectual property licensing fees give the right to transfer the sole purpose of asset securitization into ad hoc organizations ( SPV, �� SPV hire credit rating agencies ABS issued prior to the internal credit rating, �� SPV based on internal credit rating of the results and owners of intellectual property financing requirements, using the appropriate credit enhancement technology to improve the ABS's credit rating, �� SPV re-employed Credit rating agencies issue credit ratings, �� SPV issued to investors ABS, to issue revenue paid to the owners of intellectual property rights of intellectual property the next license fee of the purchase price, �� intellectual property owner or authorized service people to a knowledge Licensee property licensing fees charged, and deposited into the SPV designated collection account managed by the trustee, �� custodian scheduled debt service for investors, and credit rating agencies and other employment agencies pay.

2.2 The pool of securitized assets, intellectual property rights in intellectual property securitization process, the asset pool of the building is very important, which is the traditional asset securitization is similar. Asset pool, which can generate a set of future cash flows of assets combination, the sponsors early access to discounted future cash flows, investor interest held by its portfolio of certificates obtained a series of cash flows in the future. optimize the asset pool of the building, not only can reduce the investment risk, you can also achieve the desired stability continuous cash flow. Links to Research Papers Download http://www.hi138.com build assets is to stabilize the revenue pool and reduce risk. To avoid a franchise to build a separate pool of assets will include patents, trademark and copyright, and other high-quality intellectual property portfolio, formed a certain scale, so the market can spread some of the non-systemic risk and systemic risk. in the choice of intellectual property should take into account its size should be large enough to be single relatively small amount of receivables, intellectual property and use the higher number of geographically dispersed people. so, even if a licensee of intellectual property rights of refusal or delay in performance of its obligations, its impact is limited, and the number of licensed users are also the probability of default low, low-risk can improve the value of the asset pool.

3 IPR securitization of Development Strategy
3.1 IP Securitization in the Development process of international securitization of intellectual property as a new financing model in the United States and Europe and other Western countries are favorable, the growth rate is quite fast. From 1978 to 2000, major companies in Europe and America the "intangible assets" and "market value" ratio from 20% to 70%.

Example of the world's first securitization of intellectual property practice that is well-known British rock star David Bowie will be recorded in the 25 years prior to 1990 is expected to copyright albums (including three hundred songs recorded and copyright royalties securitization, issued in 1997, Bowie Bonds, to raise $ 55,000,000 for. Since then, intellectual property securitization Duixiang �ʲ� scope has expanded from games, music, movies, entertainment, performing arts, theme parks and other intellectual property rights and cultural industry association , to the fashion brand, the latest pharmaceutical product patents, semiconductor chip, almost all of the intellectual property rights have become the object of securitization. As investors, intellectual property rights of this new asset class is more familiar with the issue of continuing to explore a wider variety of people of financing in the future will be more innovative types of securitization of intellectual property and more large-scale securitization of intellectual property transactions.

3.2 Intellectual Property Rights in China to carry out the Development Strategy of securitization have established a relatively complete IPR legal system, and effective judicial and administrative enforcement, "two-way parallel operation" of the law enforcement system, provide for intellectual property securitization legal protection. After decades of rapid Development, China has accumulated a sizeable intellectual property assets can be securitized, the securitization of intellectual property and lay a solid foundation. securitization of intellectual property carried out the initial conditions have been met.

3.2.1 establish a government-led model of intellectual property securitization of intellectual property securitization in the initial stage, the credit base was weak, immature capital markets and other factors, the establishment of government-led model is the securitization of intellectual property rights for China's national conditions an effective way. to set up a special charge of securitization of intellectual property rights, government build a platform, banks and businesses complement each other, fully integrated and effective resources to establish "political bank and" cooperation mechanism.

3.2.2 improve the relevant legal system, to provide legal protection for intellectual property securitization securitization of intellectual property rights in order to promote the healthy and orderly development, improve the legal system is the most fundamental way. Although the securitization of intellectual property in China's legal system has been initially built, but the specific details of the law there are still some blind spots, but also continuously improved.

3.2.3 establish a high quality talent team securitization of intellectual property to develop the securitization of intellectual property, personnel development is the key. China's current IPR securitization, the biggest bottleneck is the talent. Talent shortage, making China currently only development of primary products of intellectual property securitization, the lack of growth potential. We should actively explore the securitization of intellectual property personnel training system, the appropriate introduction of foreign talents and enrich the talent.

3.2.4 establish a sound regulatory system, intellectual property rights of intellectual property securitization securitization market as a new financing model, theory is not mature enough, in practice there is no precedent for a very successful, so in the early stages, can easily lead to non-standard behavior. establish a sound regulatory system, the whole processes of the relevant regulation, in a timely manner to contain a variety of illegal activities, to ensure that intellectual property securitization market stability and healthy development.

References:
[1] Yang, Westerly. Intellectual Property Securitization: an effective way of financing of intellectual property [J]. Shanghai Finance, 2006, (10.

[2] Yuzhen Gang, Qiu Wan-hua, Yu Zhenhua. Securitization of Intellectual Property Rights Theory and Development Strategy [J]. Science, 2007, (06.

[3] XIAO Hai, Zhu Jing. To find the path to the securitization of intellectual property [J]. Legal, 2009, (06. Links http://www.hi138.com Research Papers Download