The China National Intellectual Property Administration (CNIPA) on November 16 issued the second amendment of the Measures for the Registration of Pledge of Patent Rights (《专利权质押登记办法》), which became effective in 2010.

In recent years, China has been driving the growth of patent pledge financing as an innovative tool. Companies, especially small and medium-sized enterprises (SMEs), are able to access financing by pledging patents and other intellectual property assets as collateral.

Substantive revisions have been made of Article 6, 7, 10, 11, 13, 14, 16, 19 and 20 in the amendment.

According to the amended Measures, the registration can be applied for on the online platform. The period of the examination on the part of the CNIPA has been shortened from 7 days to 5 days and further down to 2 days in cases of online application.

The amended Measures provide that a flagging mechanism about the risks arising from disputes or preservation measures concerning the pledged patents is to be established in the interest of pledgees.

The provision in the original Measures that an owner of a patent in an invalidation proceeding instituted was denied registration as a pledgor has been relaxed. According to the new Measures, the owner is entitled to file for the registration as long as the owner acknowledges the risk pursuant to the invalidation proceeding.

The provision in the original Measures that an owner of a patent for a utility model being challenged based on prior art was denied registration as a pledgor has been relaxed. According to the new Measures, the owner is entitled to file for the registration as long as the owner acknowledges the risk pursuant to the challenge.

The full text of the second amendment of the the Measures for the Registration of Pledge of Patent Rights is available here.