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Talking Transfer Pricing and the Arm’s Length Principle With Mike McDonald

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Manage episode 339582431 series 3300777
Contenuto fornito da Skadden, Arps, Slate, Meagher & Flom LLP and Flom LLP. Tutti i contenuti dei podcast, inclusi episodi, grafica e descrizioni dei podcast, vengono caricati e forniti direttamente da Skadden, Arps, Slate, Meagher & Flom LLP and Flom LLP o dal partner della piattaforma podcast. Se ritieni che qualcuno stia utilizzando la tua opera protetta da copyright senza la tua autorizzazione, puoi seguire la procedura descritta qui https://it.player.fm/legal.

The OECD transfer pricing guidelines include DEMPE — the development, enhancement, maintenance, protection and exploitation of intangibles — as part of their efforts to deal with the legal status of both IP and economic ownership. Originally, the regulations stated that only legal ownership existed; DEMPE was incorporated to accommodate contributions made by entities other than the legal owner.

But how dependable and comprehensive are the DEMPE guidelines?

In this episode of “GILTI Conscience,” Mike McDonald, an executive director in the National Tax Department at Ernst & Young, joins our hosts to discuss whether DEMPE is supportable and more efficient than a traditional review of functions, assets and risks.

Mike also shares his perspective on recent developments in transfer pricing. Mike and the “GILTI Conscience” team look at varying approaches to the accounting practice — while some professionals believe that “functions, functions, functions” is the only sustainable tactic, others contend that the arm’s length guideline is backed by sufficient valuations to outperform the alternatives. Mike delves deeply into the arguments for the arm’s length approach. “I always thought one of the strengths of the arm's length principle, if done properly, is its inherent neutrality compared to all alternatives,” he says.

What do these developments and perspectives tell us about the future of DEMPE and transfer pricing? And what patterns has an expert like Mike seen over the past two decades? Tune in to find out!

💡 Featured Guest 💡

Name: Mike McDonald

What he does: An executive director of the National Tax Department at Ernst & Young and a former senior economist at the U.S. Department of the Treasury, Mike is an expert on developments in transfer pricing over the past 20 years.

Organization: Ernst & Young

Words of wisdom: ”Realistic alternative is a tool that allows countries or taxpayers to take a step back and say, Hold on a second, does this pass the smell test? Because if something doesn't pass the smell test, odds are a realistic alternative framework can identify that.”


Connect with Skadden

☑️ Follow us on Twitter & LinkedIn.

☑️ Subscribe to GILTI Conscience on Apple Podcasts, Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on GILTI Conscience by emailing our executive producer at eman.cuyler@skadden.com.

GILTI Conscience is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. Skadden’s tax team is recognized globally for providing clients with creative and innovative solutions to their most pressing transactional, planning, and controversy challenges. The insights and views presented in GILTI Conscience are for general information purposes only and should not be taken as legal advice for any individual case or situation. The information presented is not a substitute for consulting with an attorney, nor does tuning into this podcast constitute an attorney-client relationship of any kind.

  continue reading

26 episodi

Artwork
iconCondividi
 
Manage episode 339582431 series 3300777
Contenuto fornito da Skadden, Arps, Slate, Meagher & Flom LLP and Flom LLP. Tutti i contenuti dei podcast, inclusi episodi, grafica e descrizioni dei podcast, vengono caricati e forniti direttamente da Skadden, Arps, Slate, Meagher & Flom LLP and Flom LLP o dal partner della piattaforma podcast. Se ritieni che qualcuno stia utilizzando la tua opera protetta da copyright senza la tua autorizzazione, puoi seguire la procedura descritta qui https://it.player.fm/legal.

The OECD transfer pricing guidelines include DEMPE — the development, enhancement, maintenance, protection and exploitation of intangibles — as part of their efforts to deal with the legal status of both IP and economic ownership. Originally, the regulations stated that only legal ownership existed; DEMPE was incorporated to accommodate contributions made by entities other than the legal owner.

But how dependable and comprehensive are the DEMPE guidelines?

In this episode of “GILTI Conscience,” Mike McDonald, an executive director in the National Tax Department at Ernst & Young, joins our hosts to discuss whether DEMPE is supportable and more efficient than a traditional review of functions, assets and risks.

Mike also shares his perspective on recent developments in transfer pricing. Mike and the “GILTI Conscience” team look at varying approaches to the accounting practice — while some professionals believe that “functions, functions, functions” is the only sustainable tactic, others contend that the arm’s length guideline is backed by sufficient valuations to outperform the alternatives. Mike delves deeply into the arguments for the arm’s length approach. “I always thought one of the strengths of the arm's length principle, if done properly, is its inherent neutrality compared to all alternatives,” he says.

What do these developments and perspectives tell us about the future of DEMPE and transfer pricing? And what patterns has an expert like Mike seen over the past two decades? Tune in to find out!

💡 Featured Guest 💡

Name: Mike McDonald

What he does: An executive director of the National Tax Department at Ernst & Young and a former senior economist at the U.S. Department of the Treasury, Mike is an expert on developments in transfer pricing over the past 20 years.

Organization: Ernst & Young

Words of wisdom: ”Realistic alternative is a tool that allows countries or taxpayers to take a step back and say, Hold on a second, does this pass the smell test? Because if something doesn't pass the smell test, odds are a realistic alternative framework can identify that.”


Connect with Skadden

☑️ Follow us on Twitter & LinkedIn.

☑️ Subscribe to GILTI Conscience on Apple Podcasts, Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on GILTI Conscience by emailing our executive producer at eman.cuyler@skadden.com.

GILTI Conscience is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. Skadden’s tax team is recognized globally for providing clients with creative and innovative solutions to their most pressing transactional, planning, and controversy challenges. The insights and views presented in GILTI Conscience are for general information purposes only and should not be taken as legal advice for any individual case or situation. The information presented is not a substitute for consulting with an attorney, nor does tuning into this podcast constitute an attorney-client relationship of any kind.

  continue reading

26 episodi

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