New registration system for security interests over IP rights introduced

Law 1676 of August 20 2013 provided rules regarding security interests over non-real estate property. The law included the possibility of obtaining security interests over IP rights and over the economic benefits derived from such rights.

Pursuant to Decree 400 of February 24 2014, the National Patent and Trademark Office is now in charge of the registration of security interests with regard to IP assets, such as trademarks, commercial slogans, patents, utility model patents and industrial designs.

The registration of security interests before the National Patent and Trademark Office grants a right of security over the IP asset in question. Without registration, there is no security interest, notwithstanding the existence of a written agreement.

The owner of the IP right, as it appears in the registration of the right at issue, is the only entity entitled to register the security interest. A creditor can also register it with the authorisation of the IP right owner.

For the registration of a security interest, as well as its modification, cancellation or enforcement, before the National Patent and trademark Office, applicants must file a special application form with the following information and documents:

• identification of the parties (debtor and creditor);
• IP right over which the security stands (eg, trademark, slogan, industrial design and patent of invention);
• indication of the maximum amount of the obligation to be secured with the IP right;
• documentation in support of the registration (depending on whether the registration refers to the initial security interest, its cancellation, the commencement of enforcement of the security or the termination of enforcement); and
• receipt of payment of the official fees.

The new law is also important because it introduces a new means of enforcing a security. If the parties so agree, enforcement can take place before a notary public or a chamber of commerce, without the need of going before a judge.

As the procedure and its regulations have been introduced relatively recently, it remains to be seen how they will increase access to credit for the general public.

Margarita Castellanos, Castellanos & Co, Bogota