The OECD released the latest Discussion Draft on Action 8: Hard-to-value Intangibles.
Interested parties are asked to provide comments by 18 June, 2015. A brief window period to comment should address concerns in the Draft as well as the questions posed at the end of the document. A link to the Draft is provided for reference:
“The discussion draft includes an approach based on the determination of the arm’s length pricing arrangements, including any contingent pricing arrangements, that would have been made between independent enterprises at the time of the transaction. The approach protects tax administrations against the negative effects of information asymmetry when specific conditions are met. These conditions ensure that price adjustments will only apply where the difference between expected and actual outcomes cannot be explained by considerations other than inappropriate pricing.”
The valuation of intangibles has been a very complex topic for the OECD and interested parties to address to gain a mutual perspective and balanced approach. Accordingly, this Draft and related comments will provide a new direction going forward for those countries embracing the final OECD guidelines.