Legal Issue in IP Securitization: Securitization Law, Guarantee Setting and Bankruptcy

Legal Issue in IP Securitization: Securitization Law, Guarantee Setting and Bankruptcy

 

Title
Legal Issue in IP Securitization: Securitization Law, Guarantee Setting and Bankruptcy
Author
Wei-Lin Wang
Keywords
Asset Securitization, True Sale, Securitization of Intellectual Property, Bankruptcy Remote, Executory Contract
Abstract
The word “Intellectual property (IP) securitization” was originated from asset
securitization, which started being used in the U.S. real estate market from 1960s,
and introduced to the IP field initially first in 1997. In accordance with the prosperous
market of asset securitization in the past, it is reasonable to deduce that IP securitization
will play an important role as a financial instrument as well as a powerful
financing tool for small and medium enterprises. However, due to different
characteristics of tangible and intangible assets, IP is hard to manage and it has
relatively unstable value, thus creating obstacles in IP securitization. The main obstacle
may come from lesser stability and predictability of cash flow in IP securitization,
which result in investors’ preference in other financial instruments. Therefore,
increasing the stability and predictability of cash flow from legal and business
aspect, shall be critical to the motivation of IP securitization.
This study is to investigate several legal issues in IP securitization, such as
specialized legislation, improvement on IP rights registration and guarantee filing system, influences on securitization by bankruptcy trustee’s decision upon originator’s
bankruptcy, etc. The discussion will explore relevant regulations in the mature
market of U.S. IP securitization, and make comparison and give advices to relevant
domestic regulations, providing a greater motivation of IP securitization in Taiwan
and improve domestic enterprises’ funding pipeline.
Abstract Article

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