Mortgages Beyond Immovables: A Case For Collateralisation Of Intellectual Property In India
- IJLLR Journal
- Aug 6
- 1 min read
Shiraz Ahmad Khan & Ananya Navin Dipali, National Law University, Jodhpur
ABSTRACT
In its analysis of IP as collateral, this paper restricts its course of enquiry to a specific kind of security interest, that is, mortgaging, as this is the most attractive option for debtors who do not wish to part with their IP, or impose any sort of restriction on their use and enjoyment thereof. The idea that IP can be used as collateral to secure debt is of recent origin, and still not quite popular among lenders and borrowers. This is especially true in India, where even the legality of such an endeavour is doubted by most, let alone feasibility. However, given the nature of the contemporary Indian market where enterprises have their most prized assets in the form of innovative ideas and IP, such an option would undoubtedly be of much interest. This paper seeks to demonstrate, through adequate reference to general as well as specific laws, as well as judicial pronouncements, that IP can in fact be made as collateral through mortgaging in a loan transaction. Once the possibility and legality of such an action is established, the feasibility and practical aspects of mortgaging IP will be looked into. Reference will also be made to the position of other countries vis-à-vis mortgaging IP, in order to gain a holistic picture of this practice. In conclusion, some suggestions on how to better structure the Indian legal system so that it can accommodate and encourage mortgaging of IP will be advanced.
Keywords: Mortgage, Intangibles, Intellectual Property, Transfer of Property.
