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Intellectual property valuation model expected to be implemented soon

-The Star

KUALA LUMPUR: A valuation model for banks to determine the value of intellectual property (IP) is expected to be implemented by January next year.

MCA secretary-general Datuk Seri Kong Cho Ha said the model was the product of ongoing efforts between the Government and local banks to allow businesses to receive funds to develop IP and put up their IP rights (IPR) as collateral for funding.

“Our banks have never accepted IPs, which is relatively a new concept here. But, the Government recognises the importance of IPs in propelling businesses.

“It is also important for banks to know how to properly evaluate and put a value on IPs. We are working with funding agencies and commercial banks on this matter,” Kong said at a press conference yesterday.

Under Budget 2013, RM200mil will be allocated to Malaysia Debt Ventures Bhd (MDV) to develop an IP fund scheme, which would provide a 2% interest rate subsidy and guarantee of 50% through Credit Guarantee Corp Malaysia Bhd.

A total of RM19mil has been allocated to set up an IPR market platform as well as develop new training courses for IP evaluators.

Kong, who is MCA Science and Technology Bureau chairman, said the move would ease the difficulties faced by small- and medium enterprises (SMEs) and other technology-based companies with IPs to seek funding.

MDV business division senior vice-president Nizam Mohamed Nadzri said the model was based on several methodologies, such as the discount of the net cash flow, transaction value and market valuation of the technology or product.

Meanwhile, the MCA Innovation Resource Centre (MIRC) launched its seventh annual Funding and Financing Forum to brief SMEs and entrepreneurs on their funding options.

MIRC chief executive officer Andrew Wong said more entrepreneurs would benefit from the increased funding options made available to them as announced in Budget 2013.

“The one-day forum will allow entrepreneurs, especially young ones, to explore avenues for funding.”

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