Industrial Development Bureau promoted the value appraisal and financing systems of IP rights; new business opportunities for intangible asset appraisal

Source: Economic Daily News 04/26/2002

Translated by Joanne Lue

 

    Industrial Development Bureau (“IDB”) yesterday (25) indicated that it would establish the value appraisal and financing systems of IP rights to assist enterprises in applying for financing by IP rights, to activate fund channels accessible to enterprises, and to promote enterprises’ willingness for research and development.

 

    Countries such as Korea assist enterprises to obtain IP rights financing by national appraisal, national guarantee and national financing. Moreover, the acquired quota of funds reaches about 90% of the appraised value. Accordingly, the IDB will also establish the value appraisal and financing systems of IP rights to assist enterprises in acquiring funds successfully.

 

    Concerning value appraisal, the IDB pointed out that professional appraisal organizations would be set up officially; alternatively, the accreditation system taken by private appraisal organizations would be studied. However, the IDB tends to adopt the accreditation system taken by private appraisal organizations as financing reference for banks. The IDB anticipated to promote the relevant systems from next year.

 

     The IDB has started research and promotion of the value appraisal and financing systems of IP rights. The latest Company Law which was amended in November 2001 also stipulates that the value of “technology” can be appraised and invested as capital stock. Many hi-tech companies often have their capital supported by their parent companies or other companies, and technical groups become shareholders by turning technology into capital.  In the future, the financial institutions will encounter scientific and technical industry’s application for joint loans.   Therefore, it is anticipated that the demand for appointing professional companies to make appraisal of “intangible asset” by financial institutions will increase more and more.  Hopefully bio-technical industry will also mortgage IP rights with financial institutions for loans. This will form great business opportunities in respect of “intangible asset.”  It is anticipated that the market of value appraisal of “intangible asset” will be highly profitable in the future. China Property Apprising Center Ltd. will form a strategic alliance group in recent days to plan for capturing the virgin market in “intangible assert.”