Detailed analysis of DEMPE functions
Infographic – October 2015 | RoyaltyRange
RoyaltyRange premier quality royalty rate reports contain a detailed functional, risk and asset analysis. Each royalty rate report provides an overview of functions performed with respect to the development, enhancement, maintenance, protection and exploitation of intangibles (DEMPE).
RoyaltyRange data is fully compliant with the recommendations under the final Action 8 report on Transfer Pricing Aspects of Intangibles, released by the Organization for Economic Co-operation and Development (OECD) pursuant to the Action Plan on Base Erosion and Profit Shifting (BEPS) published on 5th of October of 2015.
Under the arm’s length principle, each member of the multinational enterprise group should receive arm’s length compensation for the functions it performs. In cases involving intangibles, this includes functions related to the development, enhancement, maintenance, protection, and exploitation of intangibles (DEMPE). The identity of the member or members of the multinational enterprise group performing functions related to the development, enhancement, maintenance, protection, and exploitation of intangibles (DEMPE), therefore, is one key consideration in determining prices for controlled transactions and in determining which entity or entities ultimately will be entitled to returns derived by the multinational enterprise group from the exploitation of intangibles. Read more.