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In a new article published in International Tax Review, Managing Director Dr. Yves Hervé and Director Philip de Homont assess how companies can suitably address concerns surrounding transfer pricing license agreements. They also explain how, during the COVID-19 pandemic, fixed royalty schemes may generate a significant financial burden and risk for multinationals.

In addition, the authors describe how the financial impact of COVID-19 may provide multinationals the opportunity to transition smoothly their intangible contributions into more flexible, residual profit-sharing transfer pricing arrangements. The authors argue that these arrangements could be sustainable in the short-, medium-, and long-term, generating short-term financial benefits when they are most needed for the group and providing a consistent analytical and BEPS-compliant framework overall.