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The Challenges Ahead Due to Hard-to-Value Intangibles Guidelines by Philip de Homont

The Challenges Ahead Due to Hard-to-Value Intangibles Guidelines by Philip de Homont

The OECD’s guidance on hard-to-value intangibles requires considering the uncertainty involved when structuring and pricing transactions. While it is not clear how such guidance will be interpreted by tax authorities, the nature of the analyses needed to price hard-to-value intangibles is likely to necessitate more rigorous approaches than those that have been relied upon in the past. To address these requirements, taxpayers may need to apply more advanced techniques when valuing their intangibles; most valuations should include the perspectives of both the buyer and the seller and reflect how uncertainty would be addressed considering the bargaining positions of the transacting parties. Doing this requires top-tier abilities to simulate market outcomes, including in particular where no market data are available.

About Philip de Homont

Mr. de Homont is part of NERA's Global Transfer Pricing and Intellectual Property Practices, where he provides planning and litigation advice to international corporations and law firms. Mr. de Homont specializes in the defense of complex and unusual transfer pricing and intellectual property cases.

Mr. de Homont frequently publishes articles on transfer pricing developments, and on defense and planning cases. He is co-author to two leading German textbooks, on Transfer Pricing and Intellectual Property respectively.

About NERA’s Global Transfer Pricing Practice

NERA’s Transfer Pricing experts are here to help navigate the maze of global regulation by providing unparalleled independent and defensible economic analysis to define and substantiate intercompany transfer pricing policies, and meet compliance requirements. Critical elements are value chain analysis, risk assessment, and identification and valuation of intangibles.

NERA offers a full range of transfer pricing and valuation services and independent advice. Our global team of world-class economists uses value chain analysis, market-based pricing techniques, benchmarking studies, and rigorous valuation methodologies to design intercompany pricing policies grounded in sound business strategy and well-established economic principles. The results are transfer pricing solutions that meet clients’ global business objectives and policies, respond to tax authority challenges, and resolve disputes.

We are one of the world’s leading transfer pricing advisors with significant experience working on a range of pricing, valuation, and intellectual property projects across many industries for multinational clients and their legal and tax advisors. As unbiased economic practitioners, many leading law firms have also engaged with us as experts in litigation and arbitration. The team is in regular dialogue with tax authorities and the OECD, and members of the team sit on the EU Joint Transfer Pricing Forum.

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