Comparability

A royalty rate is not a comparable by itself

A disclosed percentage can look useful but still be weak evidence if the licensed rights, market, product, territory, term or payment base are materially different.

The main issueThe agreement explains the rate. The rate alone does not explain the agreement.

Start with the controlled transaction, not the target rate.

Screen the agreement facts before using the number.

Keep a written accept/reject reason for each candidate.

Use the final range only after qualitative review.

TPRoyalty note

This is a concise research note, not a substitute for the facts and legal or transfer-pricing requirements of a particular case.

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