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Scalable shape encoding is one of the important steps to achieving highly scalable object-based video coding. In this paper, a new scalable vertex-based shape intra-coding scheme has been described. To improve the encoding performance, we propose a new vertex selection scheme, which can reduce the number of approximation vertices. We also propose a new vertex encoding method, in which the information on the coarser layers and statistical entropy coding are exploited for high encoding efficiency. Experimental results show that the proposed scheme can provide 25-60% gain over the scalable encoding method in Buhan Jordan et al. (1998). For some sequences, it can achieve 5-10% gain over the conventional non-scalable vertex-based coding method (O'Connell (1997)) in bit rate, at the price of additional complexity.