Registering And Discharging Intellectual Property Security Interests

Intellectual property often forms an important part of a target's assets, especially for start-ups and high-tech companies. It is important for both the purchaser and the vendor to understand the security registration and discharge process in intellectual property assets.

Registration

Pursuant to the provincial Personal Property Security Acts, Intellectual property is considered a type of intangible personal property, and as previously noted in order to perfect a security interest in such intangible property, a secured party must register its security interest at the appropriate personal property security registry in the jurisdiction where the debtor is located .

In addition, a creditor may "record" such security interest under the Trade-marks Act (Canada), the Patent Act (Canada) and the Copyright Act (Canada) with the Canadian Intellectual Property Office ("CIPO") by filing a copy of the security agreement and paying the prescribed fee, if applicable. Once