Keywords: PRC Copyright Protection Centre,
computer software, copyright pledge
Copyright is a property right. Like other property rights, it
can be pledged as a financial security. According to statistics,
between 2000 and August 2010, the PRC Copyright Protection Centre
had registered 934 copyright pledges, 747 of which related to
The system of registering a copyright pledge has been in place
since 1996. A new set of Measures for Registration of Copyright
Pledge ("Measures") was published on 25 November 2010 and
will come into force on 1 January 2011. These Measures clarify and
improve the current system.
Instead of registering the pledge document, the Measures now
require the parties (pledgor and pledgee) to jointly apply to the
State Copyright Office to record the pledge. The pledge will only
become effective when it is registered in the Register of Copyright
Pledge ("Register"). To apply for registration, the
parties are required to submit the prescribed application form, the
parties' identification documents, the contract relating to the
pledge, relevant power of attorney (if applicable), written
confirmation of consent from all joint owners (if there is more
than one copyright owner), licence contracts (if any) entered into
prior to the pledge, valuation report (if any) of the copyright
work and other materials as may be required. If the documents are
in a foreign language, Chinese translations have to be
Any change, assignment or release of the pledge has to be
recorded. If all the materials and documents are in order, the
Copyright Office will complete the registration and changes within
10 days (two weeks). If any supplemental document or rectification
is required, the Copyright Office will notify the parties within 10
days and if the parties fail to respond within the time set by the
Copyright Office, the application will be treated as withdrawn.
Once the pledge is recorded, the Copyright Office will issue a
certificate. The certificate will show the basic information of the
pledgor and pledgee, the description of the copyright work pledged,
the registration number and date. Such information, together with
information about release, change and cancellation will also appear
in the Register which can be searched by the public.
Once the copyright is pledged, the pledgor cannot assign or
license use of the work without the pledgee's consent. All
proceeds from assignment or licence of the pledged copyright work
will be used to pay any amount owing to the pledgee or be held for
A copyright pledge will be released upon joint application by
the parties; the satisfaction completion of the relevant pledge
contract; the realisation of the charge; the pledgee's waiver;
or other matters leading to the termination of the charge.
A pledge may be cancelled if the pledge is adjudicated to be
terminated by a judicial, arbitral or administrative authority; the
pledge contract is determined to be invalid or terminated; the
documents submitted for registration purpose are forged or obtained
by fraud; or the registration should not have been allowed.
The Copyright Office should not allow the registration if the
pledgor is not the copyright owner; the pledge contract contravenes
any prescribed terms; the copyright period has expired; the
duration of the pledgee's repayment obligation exceeds the
copyright period; the subsistence of copyright is in dispute; or
for reason of other non-compliances.
It is expected that the implementation of the Measures will
improve the current system, encourage the commercialisation of
copyright and enhance the development of the copyright
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and/or Mayer Brown LLP. All rights reserved. Mayer Brown is a
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Mayer Brown Practices are: JSM, a Hong Kong partnership, and its
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This article provides information and comments on legal
issues and developments of interest. The foregoing is not a
comprehensive treatment of the subject matter covered and is not
intended to provide legal advice. Readers should seek specific
legal advice before taking any action with respect to the matters
discussed herein. Please also read the JSM legal publications
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