Past events

‘Secured Transactions Law Reform: Priority Rules and the Impact on Consumers’

On the 6th of  January 2017, Professor Duncan Sheehan held a conference at the Liberty Building in the University of Leeds, addressing a number of issues relating to secured transactions law reform. The conference, held in conjunction with the Secured Transactions Law Reform Project, and part-funded by the Society of Legal Scholars, assessed different models of secured transactions law reform, the impact on other areas of law, and specific problematic asset classes such as financial collateral, intellectual property rights and bitcoin.

The conference examined the relationship of a reformed law on two areas in particular. The first is the effect of reform on priorities and nemo dat quod non habet. The latter is the rule that a transferor cannot give his transferee any better title to an asset than he has. These issues will be also considered in the context of consumer protection.

Professor Sheehan has kindly made available the presentations made at the Conference, which can be downloaded below:

Webinar: Australian Personal Property Securities Act (PPSA) 2009: The Statutory Review

The Australian Personal Property Securities Act, which introduced a new scheme for registration, priorities and enforcement of secured transactions in Australia, came into force in 2012, and has very recently been subject to a three year review (which can be downloaded at https://securedtransactionslawreformproject.org/reform-in-other-jurisdictions/personal-property-security-act-jurisdictions/australia/).   Associate Professor David Brown of the University of Adelaide discussed the key points arising out of this review, and Professor Louise Gullifer commented on its significance for secured transaction reform in English law and around the world.  The webinar, which took place on 27th May 2015, was chaired by Professor Hugh Beale. It was organised by the Centre for Commercial Law at Harris Manchester College, Oxford, and was kindly sponsored by Norton Rose Fulbright.

The webinar is available at here

Conference: Security interests over intellectual property interests

On 27th March 2015 the Secured Transactions Law Reform Project (STR) held a conference on security interest over intellectual property rights, kindly hosted at the offices of Olswang. It centred on the legal and practical difficulties encountered when taking security interests in intellectual property (IP) rights, which is of particular significance in relation to access to finance. Events of this kind, where IP practitioners and credit financiers meet to discuss problems in this area, are rare and STR would like to express its gratitude to Olswang for hosting and contributing to this important conference, which – it is hoped – will be a beginning of a productive debate.

Despite the increased and continued growth in technology and globalisation, IP-rich companies have had some problems in raising finance on the basis of their intellectual property rights. This is particularly true in relation to the SME sector. Comparisons with tangible asset classes, such as real estate, show that these are still much more readily accepted as collateral despite the fact that the proportion of corporate assets that are tangible (as compared to intangible) has declined considerably over the last thirty years.

One of the chief difficulties has been a lack of communication between IP lawyers and finance lawyers, and a resulting lack of understanding by each of the problems and technicalities of the legal regime in the other’s area of expertise. It is hoped that the conference has gone some way to open this communication channel.

Some of the other key difficulties highlighted at the conference were:

  • Valuation: There is a general problem with valuation of IP as an asset class, which makes finance difficult. Such problem is not encountered with conventional forms of tangible assets, where different measures of valuation are available.
  • Cost: Financing against IP requires constant monitoring to prevent infringements. There is also at present a requirement of specialist knowledge, which adds to the cost of finance.
  • Structure of secured lending: The loan and security agreements can often operate in a manner that limits the borrower’s ability to exploit the IP to its fullest extent.
  • Funding gap: The real funding problem is with SMEs as this is where a lot of the innovation can be found but remains unexploited. The costs of taking security and pricing in the risk (including legal risk) are too high.
  • Uncertainty of law: The law on taking security in IP rights is complex and problematic. Notably, with regard to registered IP rights (e.g. patents and trade marks), the rules governing the priority of interests are antiquated and uncertain. Equally, when dealing with unregistered IP rights (e.g. copyright), secured creditors lack a reliable source of information to conduct exhaustive due diligence and have no means of giving notice of their interests to third parties.
  • Dual registration: At present, security interests in registered IP rights (e.g. patents and trade marks) owned by companies can be registered in both the Charges Registry at Companies House and the IP specialist registers (e.g. patents register, trade marks register). This overlapping, dual registration regime is evidently unpalatable, as it multiplies transactional costs and may result in troublesome discrepancies.

It was clear from the discussion that finding solutions to these problems is not easy and requires careful thinking. Reform of the law may not be able to address all these issues but to the extent that it can alleviate at least some, such as legal uncertainty and dual registration, it should be pursued.

The Secured Transactions Law Reform Project is keen to advance this debate, and would value the participation of anyone interested in these issues. Click here to join the debate.

Presentations

Introduction to the Secured Transactions Law Reform Project – Professor Louise Gullifer, University of Oxford

Security interests over IP rights under English law – Dr Andrea Tosato, University of Nottingham

Security interests over IP rights unlocking the value – Martin Brassell FRSA, CEO, Inngot

Challenges related to security interests over IP rights under the Canadian PPSA system – Professor Norman Siebrasse, University of New Brunswick

Security interests over IP rights in the USA.the UCC 9 approach – Steve Weise, Proskauer Rose

Conference: Secured Transaction Law Reform in other jurisdictions

18th June 2014 at Freshfields Bruckhaus Deringer LLP, Fleet Street, London

20th June 2014 at Palatine Building, Durham University

These conferences focused on reform or proposed reform in key jurisdictions, including Canada, the USA and Australia, as well as Scotland, Ireland and Jersey.

Programme 18th June 2014

Programme 20th June 2014

Documents for conferences:

PPSA model clauses

Jersey security law

Qatar Financial Centre Security Regulations

Current Issues in Secured Transactions Law in Canada –  Professor Anthony Duggan, University of Toronto

Current Issues in Secured Transactions Law in the United States – Professor Peter Winship, Dedman School of Law, Southern Methodist University

Comments on papers of Professor Anthony Duggan and Professor Peter Winship – Dr Magda Raczynska, University of Bristol

Presentations:

Outline of a typical PPSA scheme – Professor Hugh Beale, University of Warwick

A New World: PPSA in Australia – David Brown, University of Adelaide

Security Interests (Jersey) Law 2012 – John Rainer, Partner at Mourant Ozannes

Ireland – Dr Noel McGrath, Sutherland School of Law, University College Dublin 

Secured Transactions Reform in Scotland – Dr Hamish Patrick, Tods Murray and Dr Andrew Steven, Scottish Law Commission

Current Issues in Secured Transactions Law in the United States – Professor Peter Winship, Dedman School of Law, Southern Methodist University

Security interests in cash collateral – Professor Louise Gullifer, University of Oxford, STR Executive Director.

Seminar to explore and discuss the merits of an online register for all security interests, including outright assignments of receivables

8th May 2014,  9.30 until 12.30pm at Freshfields Bruckhaus Deringer LLP, Fleet Street, London

Presentations:

Online registration of interests in receivables Professor Louise Gullifer, University of Oxford

Prohibitions on Assignment  Professor Hugh Beale, University of Warwick

The Use of Anti-Assignment Clauses Sarah Paterson, London School of Economics.