Transfer pricing insights

If you are entering into a license agreement – whether as a licensor or a licensee – you need to understand what a royalty payment is. Royalty payments are a basic component of any licensing deal.

When you draft license or franchise agreements, negotiate royalty rates, set transfer prices or value intellectual property, analyzing third-party royalty rates helps you determine a fair royalty fee, value or arm’s length rate for transfer pricing purposes.

When you are setting transfer prices, carrying out a transfer pricing analysis, valuing intellectual property assets, conducting a business valuation, drafting a licensing agreement or dealing with an infringement case, you need to understand intellectual property.

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.

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.

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.

A license rate is a fee that is charged for the use of a licensed product or licensed intellectual property. In a typical licensing deal, the licensor gives the licensee permission to use their IP, under certain conditions, in exchange for a license rate that is set out in a license agreement.

Intellectual property royalties are payments made by a licensee to a licensor in exchange for the use of the licensor’s intellectual property.

How to license a patent for royalties: If you’ve invented a new product, you can either bring it to market yourself or license the rights to your intellectual property to a third party.

When you’re negotiating royalty rates for a patent licensing deal, or carrying out a transfer pricing analysis on an intercompany transaction involving patents, it can be useful to see what licensing fees and royalty rates other organizations charged for similar transactions, so that you can get an idea of what the market rate is.

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.

A patent royalty agreement is a contract that outlines the terms under which a licensee can use a licensor’s patented product.

A ‘reasonable royalty rate’ is an estimation of damages in patent infringement cases. It is often referred to as established royalty that a licensee would pay for the rights to the patented invention in a hypothetical negotiation.

There are no typical technology licensing fees or patent licensing fees. Technology licensing agreements are complex and, as such, technology and patent licensing fees differ greatly.

License agreements and royalties for inventions are complicated, and broad royalty rates averages often overlook the nuances and complexities of individual licensing situations.

In this article, we explain how to determine royalty rates for pharma licensing deals using the market approach (using comparable pharmaceutical royalty rates to set your own).

A detailed explanation how to determine royalty rates in fashion and why high-quality comparables data is so important. You will find it useful if you need to set royalty rates for your products or analyze your current royalty rates to make sure they are at arm’s length for transfer pricing purposes.

This page explains how to calculate arm’s length royalty rates and how to use reliable comparables data to strengthen your negotiating position or to ensure your transfer pricing compliance.

The CUP method is a traditional transaction method. Traditional transaction methods are considered the most direct way of determining whether prices and conditions between associated enterprises are at arm’s length.

Our RoyaltyRange royalty rates database is the preferred source of comparables data for European transfer pricing practitioners. We provide organizations with high-quality, easy-to-use, OECD compliant data on recent comparable license agreements…

The term ‘transfer pricing’ refers to the amount of money that is exchanged when two or more related company entities transact with each other. It is generally used in relation to multinational enterprises (MNEs)…

The RoyaltyRange team has put together a glossary of key terms that you will likely come across when using our royalty rates and service fees databases to access third-party intellectual property (IP) and service fee data for a range of purposes.

As the Organisation for Economic Co-operation and Development (OECD)’s 2017 edition of the Transfer Pricing Guidelines provides only a short explanation of what a functional analysis is, we thought we would explain it in more detail here…

RoyaltyRange provides premier quality data and services to industry leading multinational enterprises, global consulting companies, international law firms, government authorities and universities.

There are several methods that multinational enterprises (MNEs) and tax administrations can use to determine accurate arm’s length transfer pricing for transactions between associated enterprises. The Organisation for Economic Co-operation and Development (OECD) outlines five main transfer pricing methods that MNEs and tax administrations can use…