Aggregation under TNMM may not end the royalty benchmarking question

The main issueMethod choice should not hide the economics of the royalty.

Explain why aggregation is appropriate for the tested facts.

Check whether an internal uncontrolled licence exists before relying only on external data.

Be ready to support the royalty separately where the facts or local practice require it.

Keep the method choice distinct from the quality of the comparable agreement 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.

Issue themes also discussed in VSTN Consultancy's public note on transfer-pricing issues for royalty transactions. Open public reference ↗