Organizations around the world use our databases for tax, transfer pricing, valuation, legal and benchmarking purposes.

We have been featured in publications
by the Organisation for Economic Co-operation and Development,
World Bank Group, International Monetary Fund
and United Nations.

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You’re in good hands. Our databases are used by:

3

DATABASES

Our databases cover royalty rates,
loan interest rates
and service fees.

60

COUNTRIES

Our databases are used
by organizations globally.

50

COMPARABILITY FACTORS

Each agreement is analyzed
for up to 50
comparability factors.

1–3

HOURS

We spend hours
analyzing each agreement
so that you don’t have to.

THE ROYALTYRANGE TEAM

Kestutis Rudzika

Director

Kestutis is Transfer Pricing Director and Tax Lawyer at RoyaltyRange. He has extensive experience in transfer pricing and specializes in post-BEPS transfer pricing analyses, including DEMPE analyses for intangibles. Previously, he was Transfer Pricing Director at EY Belgium. He has an advanced diploma in international taxation from the Chartered Institute of Taxation (CIOT) in the UK.

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Justinas Laniauskas

THE ROYALTYRANGE TEAM

Justinas Laniauskas

Manager, New York

Justinas is a Manager at RoyaltyRange. Before joining company’s US office, he represented RoyaltyRange at events and meetings in Italy and Switzerland. He is actively involved in the development and quality maintenance of company’s loan interest rates database products. He has a cum laude Master’s degree in finance, and is working towards a Chartered Financial Analyst (CFA) certification.

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Lukas Balciunas

THE ROYALTYRANGE TEAM

Lukas Balciunas

Manager Europe, former manager for Italy

Lukas is a Manager at RoyaltyRange offices in London and Milan. He holds a Master’s degree in European law from Radboud University (the Netherlands). Having worked as a researcher with other library-as-a-service platforms, Lukas has already built a reputation for providing high-quality data-driven solutions for clients.

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Anna Siarheichyk

THE ROYALTYRANGE TEAM

Anna Siarheichyk

Manager for Eastern, Central Europe and CIS

Anna is a Manager at the RoyaltyRange London office. She holds a Master’s degree in international and European Union law, and has focused her academic interests on legal aspects of transfer pricing. Anna leads the loan department, and is in charge of compiling and analyzing data on loan transactions. Anna also plays a key role in developing the company’s client portfolio in Central and Eastern Europe.

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Karolina Slovcovaite

THE ROYALTYRANGE TEAM

Karolina Slovcovaite

Marketing manager

Karolina is a Google Certified Professional and leads our dynamic marketing team, which is in charge of creating informative and eye-catching content. She is responsible for delivering creative and strategic solutions that fulfill brand and sales objectives across multiple media platforms.

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Greta Eberson

THE ROYALTYRANGE TEAM

Greta Eberson

Customer support lead

Greta is a Senior Consultant and Support Team Lead at RoyaltyRange. She ensures that our customer service is of the highest standard in terms of efficiency and quality, and that our clients are satisfied with the services we provide.

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What our clients say about us

I like the search results very much and have found perfect matches for my engagement. Kerwin Jin, Transaction Advisory, EY

Our cooperation is a valuable asset for us as the data received from your company helps us with our work and is value-adding. Lukas Drobnys, Tax, KPMG

Both our commercial and litigation IP lawyers were impressed with your service offering. Wayne Beynon, Commercial Disputes, Capital Law, UK

We highly appreciate your responsiveness and quality of results. Kerstin Heinecke, Financial Solutions, FAS AG, Germany

We consider RoyaltyRange one of our most valued collaborators, so we will surely continue to use their services in the future. Ivana Ilic, Tax, Deloitte

Your assistance and the data provided was very helpful for our project. Jack Violetta, BDO US

I found the system very reliable, well organized and easy to use. Andrea Tiburzi, Barzanò & Zanardo, Italy

The data was very helpful to me. Kate Morris, PYA, US

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OECD definition of royalties

Insights

According to Article 12 of the OECD Model Convention with Respect to Taxes on Income and on Capital, the term ‘royalties’ refers to ‘payments’ of any kind received as a consideration for the use of, or the right to use, any copyright of literary, artistic or scientific work including cinematograph films, any patent, trade mark, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific experience’. As stated in the Glossary of Industrial Organisation Economincs and Industrial Law (term 116), published by the OECD, ‘Copyright, trademark and patent holders may license others to use or produce the good, usually in return for a fixed payment and a royalty rates’.

According to the Commentaries on the Articles of the Model Tax Convention (Commentary on Article 12, Paragraph 2 (point 8)), ‘the definition applies to payments for the use of, or the entitlement to use, rights of the kind mentioned, whether or not they have been, or are required to be, registered in a public register. The definition covers both payments made under a licence and compensation which a person would be obliged to pay for fraudulently copying or infringing the right’.

There is an ongoing debate about whether the definition of royalties should be an open or a closed definition. The current approach used in the Model Tax Convention suggests that the closed definition is appropriate; however, some people argue that a new sentence should be included in the OECD definition that states that other types of rights or assets similar to those expressly mentioned may also bring about royalties.

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Royalty rates data

Insights

How can one get the royalty rates data? As indicated below, a source for such arm’s length royalty rates could be found in commercial databases. Royalty rates for various types of intangibles, e.g. trademarks, trade names, patents, know-how and others can be found there.

OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (Chapter III, Section A.4.3.1, paragraph 3.30) identifies that there are various sources of information that can be used to identify potential external comparables. A common source of information is commercial databases that can be practical and cost-effective way of identifying external comparables and may provide the most reliable source of information. Revision of the Special Considerations for intangibles in Chapter VI of the OECD Transfer Pricing Guidelines and Related Provisions (Chapter IV, Section D.1., paragraph 103) further states that ‘Comparability, and the possibility of making comparability adjustments, is especially important in considering potentially comparable intangibles and related royalty rates drawn from commercial data bases’.

RoyaltyRange royalty rates database provides reliable and detailed data on the comparable licence agreements involving intellectual property and royalty rates. Our proprietary royalty rates database contains manually gathered and analysed data on the most recent licensing transactions and royalty rates in various industrial sectors. Our data reports contain more than 50 standartised comparability factors on royalty rates and other terms of the licence and only unredacted agreements (i.e., licences where royalty rates are disclosed) containing royalty rates expressed in percentages are included in the database.

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Alternative definition of royalties

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Following a simpler definition, royalties are payments made by one party, the licensee (the user of intangibles), to another party, the licensor (the owner of intangibles), for the use of intangibles owned by the licensor. Royalties are often expressed as a percentage of the revenues obtained using the owner’s property; however, they can be also expressed in other terms (including a fixed value), depending on the specific characteristics of the licence agreement.

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What are intangibles

Insights

In order to better understand what royalties are, it is important to define the term ‘intangibles’. According to the definition given in paragraph 6.6 of Section A of the final report of Action 8 published by OECD on 5th October of 2015 under the Base Erosion and Profit Shifting (BEPS) initiative: ‘Intangible is intended to address something which is not a physical asset or a financial asset, which is capable of being owned or controlled for use in commercial activities, and whose use or transfer would be compensated had it occurred in a transaction between independent parties in comparable circumstances’.

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Economic and legal ownership of intangibles

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This definition also brings up an extremely important question regarding ownership of intangibles and of what ‘being owned or controlled’ actually means. There is an ongoing debate about the distinction between economic and legal ownership of intangibles. As paragraph 6.32 of Section B of the final report of Action 8 published by OECD on 5th October 2015 under the BEPS initiative notes: ‘Although the legal owner of an intangible may receive the proceeds from exploitation of the intangible, other members of the legal owner’s multinational enterprise (MNE) group may have performed functions, used assets, or assumed risks that are expected to contribute to the value of the intangible’.

In this regard, it is considered that the companies of the group that perform such functions, use such assets, and assume such risks must be compensated for their contributions under the arm’s length principle. Consequently, it is derived that ‘the ultimate allocation of the returns derived by the MNE group from the exploitation of intangibles, and the ultimate allocation of costs and other burdens related to intangibles among members of the MNE group, is accomplished by compensating members of the MNE group for functions performed, assets used, and risks assumed in the development, enhancement, maintenance, protection and exploitation of intangibles’.

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