Charge over Intellectual Property

Creations of the mind that are legally protected, including patents, trademarks, copyrights, and trade secrets. IP is a critical intangible asset category for technology and innovation-driven firms and can be licensed, sold, or used as collateral for financing.

A systematic review of a company's intellectual property portfolio — including patents, trademarks, copyrights, trade secrets, domain names, and licences — to assess ownership, validity, enforceability, freedom to operate, and commercial relevance. IP audits are essential in M&A due diligence, technology licensing negotiations, and litigation preparation.

A security document commonly used in UK lending that creates a combination of fixed and floating charges over all or substantially all of a company's assets in favour of a lender. A debenture typically grants fixed charges over specific high-value assets (property, key IP) and a floating charge over the company's remaining assets and undertaking.

A security interest that gives a lender a claim against all of a borrower's assets, both current and future, rather than specific identified collateral. Blanket liens are commonly used in small business lending and working capital facilities where itemising individual assets would be impractical.

A public or restricted-access registry identifying the natural persons who ultimately own or control legal entities such as companies, trusts, and partnerships. In the UK, the People with Significant Control (PSC) register is maintained at Companies House, while the EU's Anti-Money Laundering Directives require member states to maintain central beneficial ownership registers.

A financial ecosystem built on blockchain technology that provides financial services — including lending, borrowing, trading, insurance, and asset management — without traditional intermediaries such as banks, brokerages, or exchanges. DeFi protocols use smart contracts to automate financial transactions and are typically open-source, permissionless, and composable.

The ratio of a loan amount to the appraised value of the underlying collateral, expressed as a percentage. LTV is a primary risk metric used by lenders to assess the adequacy of collateral coverage — a lower LTV indicates greater equity cushion and lower credit risk.

A security interest that becomes effective only upon the occurrence of a specified trigger event, such as a covenant breach, a decline in borrower creditworthiness, or the drawing down of a revolving credit facility beyond a certain threshold. Springing liens provide lenders with additional collateral protection when needed while allowing borrowers to operate without encumbered assets during normal business conditions.

IP Valuation: How to Value Intellectual Property

What is a legal mortgage over intellectual property?

A legal mortgage over IP transfers legal title of the rights to the lender as security, with a licence-back so you keep using them; it is the strongest form of IP security and is discharged when the loan is repaid.

What is the difference between a fixed and floating charge over IP?

A fixed charge attaches to identified IP (for example, a specific patent by number) and ranks highly on insolvency; a floating charge covers a shifting pool of assets and ranks below fixed charges and preferential creditors.

What is Section 859A and why does it matter for IP loans?

Section 859A of the Companies Act 2006 requires most company charges to be registered at Companies House within 21 days. Miss the deadline and the security is void against a liquidator or administrator.