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Security Rights in Intellectual Property in the Czech Republic

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Security Rights in Intellectual Property

Part of the book series: Ius Comparatum - Global Studies in Comparative Law ((GSCL,volume 45))

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Abstract

This chapter provides general information on the legal regulation of security rights over intellectual property under the law of the Czech Republic. The issue discussed is divided into two main parts.

The authors begin by providing a short overview of the national and EU protections for intellectual property and emphasize that the ability to use intellectual property assets as security is determined primarily by the transferability of the IP rights. Therefore, it is necessary to make a distinction between personal (moral) rights and economic rights, since only economic rights are transferable.

The authors conclude that under Czech law, the most relevant and commonly used security rights are the pledge; the transfer of a right as a security; and the prohibition against encumbrance and/or alienation. Furthermore, the authors discuss the creation, accessorial nature, and perfection of these rights. A few remarks are also made regarding the valuation of the intangible assets. Finally, the frequency with which security right transactions are registered by the Industrial Property Office of the Czech Republic is considered.

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Notes

  1. 1.

    Vojčík (2012), pp. 33–35; Vojčík (2016), pp. 20–21; Telec (1994), p. 42.

  2. 2.

    Telec and Tůma (2007), p. 67; Koukal (2016), pp. 450–466.

  3. 3.

    The English translation available at: http://www.wipo.int/wipolex/en/text.jsp?file_id=137175. Accessed Jan 10, 2019.

  4. 4.

    The legal regulations regarding licence contracts are set forth in Art. 2358-2389 Civil Code (Act. No. 89/2012 Coll., Civil Code, as amended; the English translation available [online] at: http://obcanskyzakonik.justice.cz/images/pdf/Civil-Code.pdf. Accessed Jan 10, 2019). The Copyright Act is applicable as a lex specialis in relation to the Civil Code. “Copyright law forms, together with other rights to the results of intellectual creative activity and together with other special proprietary rights, a sub-system of substantive civil law”. Decision of the Czech Supreme Court from 2007-04-30, File No. 30 Cdo 739/2007.

  5. 5.

    Moral rights last only for the period of the author’s life (limited post-mortal protection is vested to close relatives to the author, legal persons associated with the author, or the relevant collecting society [Art. 11 (5) Copyright Act]). Economic rights last for the period of the author’s life and for 70 years after his death [Art. 27 (1) Copyright Act].

  6. 6.

    The transfer of rights upon the death of the author (mortis causa) is permissible; the general rules of the inheritance law regulated by the Civil Code are fully applicable. Telec and Tůma (2007), pp. 314–315.

  7. 7.

    Telec and Tůma (2007), pp. 157–158, 309–314.

  8. 8.

    Telec and Tůma (2007), pp. 678–680, 689–690, 708–710, 732–734.

  9. 9.

    The English translation available at: https://www.upv.cz/en/legislation/national/codes.html. Accessed Jan 10, 2019. The trademark legislation has been amended in 2019, depending on the implementation of Directive (EU) 2015/2436 of the European Parliament and of the Council of December 16, 2015, to approximate the laws of the Member States relating to trademarks.

  10. 10.

    Horáček et al. (2015), pp. 160–167.

  11. 11.

    Horáček et al. (2015), pp. 168–171.

  12. 12.

    The English translation is available at: https://www.upv.cz/en/legislation/national/codes.html. Accessed Jan 10, 2019. Czech patent legislation is fully compatible with the principles contained in the European Patent Convention.

  13. 13.

    Chloupek et al. (2017), pp. 137–140. However, the inventor’s right of authorship of the invention is not waivable or transferable, given that it is a personal (moral) right.

  14. 14.

    The English translation is available at: https://www.upv.cz/en/legislation/national/codes.html. Accessed Jan 10, 2019.

  15. 15.

    The English codified version has been promulgated by Regulation (EU) 2017/1001 of the European Parliament and of the Council of June 14, 2017 on the European Union Trade Mark. The English version is available at: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32017R1001. Accessed Oct 21, 2018.

  16. 16.

    The English version is available at: https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX%3A32002R0006. Accessed Oct 21, 2018.

  17. 17.

    Regulation (EU) No. 1257/2012 of the European Parliament and of the Council of December 17, 2012 Implementing Enhanced Cooperation in the Area of the Creation of Unitary Patent Protection, available at: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32012R1257. Accessed Oct 21, 2018.

  18. 18.

    Telec and Tůma (2007), pp. 169–170.

  19. 19.

    Art. 2, 8, 23, and 24 of the Act No. 452/2001 Coll., on the Protection of Designations of Origin and Geographical Indications and on the Amendment to the Act on Consumer Protection, as amended. The English translation available at: https://www.upv.cz/en/legislation/national/codes.html. Accessed Oct 21, 2018.

  20. 20.

    “(1) A corporeal thing is a controllable part of the external world having the character of an independent object. (2) Incorporeal things are rights whose nature allows it, and other things without corporeal substance” (Art. 496 Civil Code).

  21. 21.

    Macek (2014), pp. 597–606; Koukal (2017), p. 1033.

  22. 22.

    Telec and Tůma (2007), pp. 312–313.

  23. 23.

    Art. 29 of the Council Regulation (EC) No. 6/2002; Art. 19 of the Council Regulation (EC) No. 207/2009 as amended by the Regulation No. 2015/2424; Art. 22 of the Regulation of the European Parliament and of the Council No. 2017/1001.

  24. 24.

    Kindl (2016), pp. 55–56.

  25. 25.

    In this chapter, we use the following terminology: by “pledge” we mean the form of the security right, and by “collateral” we mean the subject matter that has been given as a security (such as a trademark, patent, or industrial design).

  26. 26.

    We use the term “pledgor” to refer to the person who has the benefit of the pledge and is the creditor in the obligatory relationship with the debtor.

  27. 27.

    Art. 17 (3) Trademarks Act; Art. 31 (1) Industrial Designs Act. The Civil Code provides the general rule that “a pledge on a right which is registered in a public register is created by the registration in this register, unless otherwise provided by another legal regulation” (Art. 1316 Civil Code).

  28. 28.

    “A prohibition to encumber or alienate a thing has effect only between the parties, unless it has been established as a right in rem. Such a prohibition is valid if it has been established for the duration of a trust, succession by fideicommissum, representation or for another specific and reasonable period in such an interest of a party which deserves legal protection” (Art. 1761 Civil Code).

  29. 29.

    Richter (2013), pp. 1115–1116.

  30. 30.

    Svačina (2010), pp. 57, 76, 97, 134.

  31. 31.

    “The market value is the estimated amount of money for which the asset would be possibly exchanged at the valuation date between the willing buyer and the seller, when both parties act freely and in an informed and reasonable manner.”; Svačina (2010), p. 75.

  32. 32.

    Svačina (2010), pp. 134–153.

  33. 33.

    Svačina (2010), pp. 62.

  34. 34.

    Art. 143, 251, 478, 573 Act No. 90/2012 Coll., on Business Corporations, as amended. The English translation available at: http://obcanskyzakonik.justice.cz/images/pdf/Business-Corporations-Act.pdf. Accessed Jan 10, 2019.

  35. 35.

    If industrial property rights are transferred, the contract is legally binding among the parties at the moment of the conclusion of the contract [Art. 1745, 570 (1) Civil Code]. However, the effectiveness erga omnes (against third parties) takes effect upon the registration of the transfer in the registry [Art. 14 (2), Art. 15 Industrial Designs Act; Art. 30 (1), Art. 32 (3) Patents Act; Art. 15 (3), Art. 18 (3) Trademarks Act].

  36. 36.

    The pledge which is established on a set of assets or on a business enterprise arises on the basis of registration with the Pledge Register, which is maintained by the Notarial Chamber of the Czech Republic. The pledge must be in the form of a notarial deed [Art. 1314 (2) Civil Code]. The security does not exist until after registration. However, the Pledge Register is not a public register that is freely accessible to the public and that everyone can inspect.

  37. 37.

    However, not in the Pledge Register, which is not considered to be a public register.

  38. 38.

    Richter (2014), pp. 1252–1254.

  39. 39.

    Act No. 182/2006 Coll., on Bankruptcy and Settlement, as amended (the English translation is not available).

  40. 40.

    E.g. costs of insolvency proceedings, the remuneration of the bankruptcy liquidator, taxes, or fees.

  41. 41.

    E.g. unpaid employee wages, receivables of the state, or outstanding alimony.

  42. 42.

    Richter (2014), pp. 1252–1254.

  43. 43.

    A subordinated claim is a claim which, according to the wording of the contract, should be satisfied only after the satisfaction of another creditor’s claim.

  44. 44.

    Act No. 634/2004 Coll., on Administrative Fees, as amended. The English translation is available at: https://www.upv.cz/en/legislation/national/related-legislation.html. Accessed Jan 10, 2019.

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Author information

Authors and Affiliations

  1. Masaryk University, Faculty of Law, Brno, Czech Republic

    Pavel Koukal & Helena Pullmannova

Authors
  1. Pavel Koukal
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  2. Helena Pullmannova
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Correspondence to Pavel Koukal .

Editor information

Editors and Affiliations

  1. Faculty of Law, University of Würzburg, Würzburg, Germany

    Eva-Maria Kieninger

Appendices

List of Cases

Decision of the Czech Supreme Court from 2007-04-30, File No. 30 Cdo 739/2007.

List of Laws

Administrative Fees Act:

Act No. 634/2004 Coll., on Administrative Fees, as amended. The English translation available [online] at: https://www.upv.cz/en/legislation/national/related-legislation.html

Business Corporations Act:

Act No. 90/2012 Coll., on Business Corporations, as amended. The English translation available [online] at: http://obcanskyzakonik.justice.cz/images/pdf/Business-Corporations-Act.pdf

Civil Code:

Act. No. 89/2012 Coll., Civil Code, as amended; the English translation available [online] at: http://obcanskyzakonik.justice.cz/images/pdf/Civil-Code.pdf

Copyright Act:

Act No. 121/2000 Coll., on Copyright and Rights Related to Copyright and on Amendment to Certain Acts, as amended; the English translation available [online] at: http://www.wipo.int/wipolex/en/text.jsp?file_id=137175

Designations of Origin and Geographical Indications Act:

Act No. 452/2001 Coll., on the Protection of Designations of Origin and Geographical Indications and on the Amendment to the Act on Consumer Protection, as amended. The English translation available [online] at: https://www.upv.cz/en/legislation/national/codes.html

Industrial Designs Act:

Act No. 207/2000 Coll., on the Protection of Industrial Designs, as amended; The English translation is available [online] at: https://www.upv.cz/en/legislation/national/codes.html

Insolvency Act:

Act No. 182/2006 Coll., on Bankruptcy and Settlement, as amended (the English translation is not available).

Patents Act:

Act No. 527/1990 Coll., on Inventions and Rationalisation Proposals, as amended; The English translation is available [online] at: https://www.upv.cz/en/legislation/national/codes.html

Trademarks Act:

Act No. 441/2003 Coll., on Trademarks and on Amendments to Act No. 6/2002 on Judgements, Judges, Assessors and State Judgement Administration and on Amendments to Some Other Acts (Act on Courts and Judges); The English translation available [online] at: https://www.upv.cz/en/legislation/national/codes.html

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Koukal, P., Pullmannova, H. (2020). Security Rights in Intellectual Property in the Czech Republic. In: Kieninger, EM. (eds) Security Rights in Intellectual Property. Ius Comparatum - Global Studies in Comparative Law, vol 45. Springer, Cham. https://doi.org/10.1007/978-3-030-44191-3_10

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