A pilot intellectual property rights (IPR) exchange opened Saturday in north China's port city of Tianjin, allowing investors to buy IPR shares and help small- and medium-sized enterprises (SMEs) to ease their financial woes.

The Tianjin Binhai Intellectual Property Exchange International, operated by the government-backed Northern Technology Exchange Market and the Tianjin IPR Service Center, is the first of its kind in China and is considered to be a "financial innovation" by the Tianjin municipal government.

China has no precedent for IPR exchanges, He Hua, deputy chief of China's State Intellectual Property Office (SIPO), said Saturday at the exchange's opening ceremony in Tianjin.

Institutes and individuals may use the exchange to buy IPR shares, the same as they would in a normal fund market. Publicly traded IPRs mainly come from China's emerging industries, including cultural and creative sectors.

"This is headline news for China's SMEs," said Tianjin's deputy mayor Cui Jindu.

Financing shortage has become one of the biggest problems for China's technology companies in their struggle to transfer IPRs.

A survey conducted by the Tianjin Municipal Science and Technology Commission in 2010 showed that 63.79 percent of Tianjin's technological enterprises were dealing with financing shortage.

"More than 15 percent of the respondents said they wanted funding and support from the government, and about 17 percent wanted credit aid from banks," according to the survey's results.

During the exchange's opening ceremony, representatives from the exchange signed strategic cooperation agreements with six banks, as well as asset appraisal companies, trust companies and law firms from both home and abroad.

"IPR securitization and capitalization has become a global trend. This trend is the main reason behind the establishment of our IPR exchange," said Lin Yishan, president of the exchange, during the opening ceremony.

According to Lin, investors may use the exchange to directly buy and sell IPR shares, complete equity transactions between companies with IPR shares or conduct trades of financial and derivative products based on IPRs.

The exchange will feature IPR funds, investor unions, an examination and verification committee, a legal affairs commission and a supervisory commission in the near future, according to exchange authorities.

(Source: Xinhua)