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When a company dissolves and enters liquidation, its patents, trademarks and designs are assets that must be addressed. Transfers by a company in liquidation, acting as assignor, involve additional requirements and practical considerations.
The situation of liquidation is not just a status indicator, but it directly affects many factors, such as the representative of the corporation, the purpose of the disposal of the rights, and the time of the transfer registration. In this article, we will summarize the legal structure and working points that must be verified prior to patent, trademark and design right.
The extent of legal status and rights disposition of the entity in liquidation
Dissolution does not immediately extinguish a corporation. It continues to exist for the purposes of liquidation until those affairs are completed.
During liquidation, the corporation may carry out acts needed to collect receivables, repay debts, realize assets, and distribute remaining property. A transfer of patents, trademarks, or designs may form part of that process.
Therefore, the transfer of intellectual property rights by a liquidating entity is permitted in principle, but the act must be within the scope of the liquidation purpose.
Who represents the corporation in an IP transfer?
Upon dissolution, representation for liquidation generally passes from the former representative director to the liquidator.
If no liquidator is separately appointed under the articles or a shareholders' resolution, the directors at dissolution generally serve as liquidators, subject to applicable law and any court appointment. The liquidator represents the corporation in transactions required for liquidation.
An assignment made by a corporation in liquidation must therefore be executed by the person authorized to act as its liquidator.
Required Documents
When a corporation is liquidated and the patent, trademark, and design right transfer registration is carried out, there are three key documents in practice.
First, the corporate seal certificate.
In this case, the certificate must have been issued within six months. This is a mandatory requirement to ensure that the legal seal on the deed of assignment is currently valid, and is not tempered by the fact that it is being liquidated.
The name of the company must be correctly stated on the corporate seal certificate, and the seal must be entered by the liquidator, and the seal of the seal signed on the deed of transfer must be identical.
Second, the deed of assignment or assignment agreement.
The document must identify the rights transferred and clearly express the parties' intention to assign and acquire them. The liquidator representing the corporate assignor must be identified.
Where the assignor is a corporation in liquidation, naming only the corporation is insufficient to identify who is authorized to dispose of its IP.
The assignor section should identify the corporation and its liquidator, with the appropriate signature or corporate seal. Omitting the liquidator's capacity can lead to questions about authority.
During transfer registration, the office checks the signer's authority. If the liquidator's identity or capacity is unclear, correction or further evidence may be required.
Third, powers of attorney.
Where agents handle the registration, the necessary authorizations should be obtained from both assignor and assignee. The corporation in liquidation must authorize its agent through the liquidator.
If the assignee also acts through an agent, a power of attorney must be submitted for the assignee as well. Powers of attorney from both parties help the assignment registration proceed smoothly.
The importance of registering the assignment before liquidation closes
When the assignor is a corporation in liquidation, the timing of assignment registration is critical. In particular, patent rights may lapse if the assignment is not registered by the date on which completion of liquidation is registered.
Signing an assignment agreement alone is insufficient; the assignment must also be registered. In addition to preparing the deed and seal certificate, the parties must manage the schedule so that registration is completed before liquidation closes.
Trademark and design rights also require careful management, as missed maintenance payments or delayed assignment registration during liquidation can lead to loss of rights.
Cost
1) Agent Fees: Fees paid to the patent attorney
Costs vary from office to office in the event of a transfer of rights through an agent.
2) Official fees: fees and taxes payable for registration of a patent assignment
Registration fee: 40,000 won
Registration and license tax: KRW 21,600
Stamp duty: varies with the assignment price
Assigning patents, trademarks or design rights from a corporation in liquidation requires particular care. Prepare a corporate seal certificate issued within six months, identify the liquidator and their authority clearly in the deed, and complete assignment registration before liquidation closes.
A liquidating corporation's intellectual property can be valuable realizable assets. However, document defects or missed deadlines can cause rights to lapse without compensation. Assignments by such corporations therefore require particularly careful handling.
Assigning a liquidating corporation's patents, trademarks or design rights requires consideration of its legal status, the liquidator's authority and the timing of registration.
This article reflects the information available when it was published. Contact us to discuss your circumstances.