What does pledge patent mean?

Patent pledge refers to the civil guarantee behavior in which the debtor or the third party takes all the patent rights as the guarantee for its debt performance. When the debtor fails to perform the debt, the creditor has the priority to be compensated for the discount, auction or sale of the patent right.

legal ground

Article 394 of the Civil Code of People's Republic of China (PRC)

In order to ensure the performance of the debt, if the debtor or a third party mortgages the property to the creditor without transferring the possession of the property, if the debtor fails to perform the due debt or realize the mortgage according to the agreement of the parties, the creditor has the right to be compensated in priority for the property.

The debtor or the third party specified in the preceding paragraph is the mortgagor, the creditor is the mortgagee, and the property that provides guarantee is the mortgaged property.