If you’re thinking of licensing your intellectual property to a third party, or you want to enter into an agreement that lets you use another brand’s intellectual property, then you’ll need to understand how the remuneration side of the agreement works.
Articles by Kris (Kestutis) Rudzika
Kris (Kestutis) Rudzika
Kris 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.
If you’re thinking of licensing your intellectual property or becoming a licensee, you need to be familiar with royalty agreements. The royalty agreement of a company is a central part of any licensing deal and makes sure that both parties are compensated fairly for their contributions.
Finding the royalty rate for your industry can be a helpful starting point if you’re valuing your intellectual property or setting royalty rates for a licensing agreement.
If you are licensing your intellectual property, finding the relevant range of royalty percentage for your intangible assets will help you set fair, accurate royalties that reflect market rates.
Legal agreements between group companies (often called ‘Intercompany agreements’ or ‘ICAs’) are an intrinsic part of Transfer Pricing compliance – a fact which is highlighted by the OECD’s Transfer Pricing Guidelines.
The royalty rates you can charge for licensing a trademark differ by industry. When you’re entering into a trademark license agreement, or you’re carrying out a transfer pricing analysis on an intercompany transfer of trademark rights, it’s helpful to know what rates are typical in the industry.
Trademark royalties are the payments a licensee makes to a licensor in exchange for the use of their trademark.
To determine royalty rates for technology, you need to know the market value of the intellectual property you’re licensing and use comparable license agreements as a starting point for your analysis.
Intercompany royalties are the remuneration charged when intangible property is transferred or licensed between related company entities. In this article, we’ll go into more detail about what royalties are, what requirements they need to meet for transfer pricing purposes, and how to set them.
Brand royalty rates are payments made from a licensee to a licensor in exchange for the use of their brand assets. They are usually a percentage of the revenue generated by the licensee’s use of the brand.