Transfer Pricing

Transfer pricing is a specialization of Economics Partners at Ryan, where our professionals have proven themselves to stand apart from the rest. Our services in this area include the following:

Transfer Pricing

Controversy and Audit Defense

Taxpayers, authorities, and other parties utilize our proficiency as expert witnesses in litigation and bankruptcy matters. We negotiate with governments on behalf of our clients, and prominent law firms routinely seek our expertise to address transfer pricing controversies. We have assisted tax authorities in policy position development allowing for “win-win” settlements. Finally, we develop defense strategies to represent taxpayers at tax audit negotiations.
Transfer Pricing

Design and Planning

We routinely assist in designing and pricing supply chain, intangible property, and other intercompany transaction structures. This includes the development of effective and reliable methods for valuing entity conversions, pricing contractual features, pricing exploitation and research rights, and numerous other economic analyses. Our controversy experience allows us to develop defensible transfer pricing structures that avoid tax authority scrutiny.
Transfer Pricing

Documentation

Our compliance efforts generally center on documenting structures that we have assisted in designing. However, we also provide initial documentation for clients’ existing transactions as well as documentation updates for those transactions. Our approach to compliance and documentation is highly cost effective.
Transfer Pricing

Advance Pricing Agreements

We design pricing models, file advance pricing agreement (APA) requests, and agree to terms with U.S. and foreign tax authorities.
Transfer Pricing

Competent Authority Proceedings

In the event of double taxation arising from a tax audit, we prepare taxpayers’ transfer pricing Competent Authority resolution.
Transfer Pricing

Operational Transfer Pricing

We develop frameworks for unit intercompany pricing of products to more efficiently achieve an organization’s transfer pricing goals.

Case Studies

Transfer Pricing

Global Specialty Pharmaceutical Company

The Challenge

  • The company historically operated in Ireland and North America (Puerto Rico and United States) and acquired the branded pharmaceutical business for a Fortune 100 company, nearly tripling the company in size overnight and expanding its operations throughout Europe. 

The Solution

  • Assisted the company in harmonizing transfer pricing policies for the legacy and acquired businesses.
  • Migrated intellectual property acquired in the acquisition to centralize ownership and where profits were taxed.
  • Obtained advance pricing agreements in several jurisdictions to reduce tax uncertainty risk.
  • Developed operational transfer pricing policies to improve quarterly results reporting, accuracy, and efficiency.

Large Industrial Company

The Challenge

  • This company was involved in a multi-year audit involving intercompany licensing.

The Solution

  • Involved a multiyear audit involving intercompany licensing.
  • The IRS proposed an adjustment that nearly tripled the royalty rate.
  • We assisted in MAP proceeding with APMA and foreign tax authority.
  • Our involvement resulted in a settlement of less than 10% of the originally proposed adjustment.
Transfer Pricing
Transfer Pricing

Pharmaceutical Intellectual Property Licensing

The Challenge

  • A pharmaceutical company that licensed IP for an early-stage drug to its foreign-related subsidiary received a proposed adjustment form the IRS on a royalty rate more than 10x what the client submitted.   

The Solution

  • Negotiated a full withdrawal of the proposed adjustment from the IRS.

Energy Company

The Challenge

  • A foreign tax authority proposed significant reduction in interest rates for four tranches for an energy company client that had multiple intercompany loans.

The Solution

  • Steered negotiations with the taxing authority, resulting in no adjustment for three of four tranches and a reduction in interest rate (approximately 15% of the originally proposed reduction) in final tranche.

Transfer Pricing

Thought Leadership and Expertise

1Publications
  • “Amount B, Baseline Marketing and Distribution Activities, and the Arm’s-Length Principle,” Tax Notes International, March 27, 2023, by Perry Urken
  • “The Border Adjustment Tax: What Companies Need to Know,” Tax Notes, April 2017, by Perry Urken with Timothy Reichert
  • “The Impact of the Ways and Means Committee Hearing on MNCs in the US,” CRA Insights, October 2010, by Perry Urken with Kathrine Kimball and Nicole Bordeleau
  • “Implications of FIN 48 for Transfer Pricing Analyses,” World Finance, August/September 2007 by Perry Urken with Gerben Weistra
  • “Swap Transactions Between Related Parties,” World Finance, June/July 2006 by Perry Urken with Mike DeLaval and Anthony Barbera
  • “Some Thoughts in the Treatment of Risk in a Transfer Pricing Context,” World Finance, February/March 2006, pp.60–61 by Perry Urken with Anthony Barbera
  • “Adjusting for Differences in Risk Levels Between Tested Parties and Comparable Firms,” BNA Tax Management Transfer Pricing Report, Volume 12, Number 1, May 14, 2003, pp.39–43, by Perry Urken with Anthony Barbera and Jeff Cole
2White Papers
  • The Licensor – Licensee Split: A Microeconomic Analysis, by Ian Gray with Tim Reichert
  • How to Accurately Price and Design Intercompany Debt, by Ian Gray with Tim Reichert, Nathan Callard, and Erin Hutchinson
3Presentations
  • A Transfer Pricing Economics Approach to Carbon Pricing, presented by Perry Urken at the Informa Sustainability & ESG in Taxation Conference in Amsterdam, Netherlands, October 2023
  • Transfer Pricing Issues Arising as a Result of the Green Agenda, Part II, panel including Perry Urken at the Informa Sustainability & ESG in Taxation Conference in Amsterdam, Netherlands, October 2023
  • Amount B: An Evaluation of Existing Critiques and the Role of Empirical Evidence, panel including Perry Urken at NABE Transfer Pricing Symposium, Washington, D.C., July 2023
  • Transfer Pricing for Carbon Emissions and Credits, panel including Perry Urken at the Conference of the USA Branch of the International Fiscal Association, Chicago, Illinois, April 2023
  • The Road Towards Sustainability & ESG in Transfer Pricing, panel including Perry Urken at the TP Minds International Conference in Ft. Lauderdale, Florida, March 2023
  • Transfer Pricing Issues Arising as a Result of the Green Agenda, panel including Perry Urken at the Informa Sustainability & ESG in Taxation Conference in London, England, October 2022
  • Potential Impacts on MNC Transfer Prices from Developments Related to Climate Change, panel including Perry Urken at NABE Transfer Pricing Symposium, Washington, D.C., July 2022
  • When Should Commensurate with Income be Applied? panel including Perry Urken at International Fiscal Association USA Branch Conference, Washington, D.C., June 2022
  • Trends and Conclusions in Recent Transfer Pricing Litigation, panel including Perry Urken at TP Minds Conference, Miami, FL, April 2022
  • How Big a Problem is Profit Shifting Today? panel including Perry Urken at NABE Transfer Pricing Symposium, Washington, D.C., July 2021
  • Tax Challenges in the New Digital Age, panel including Perry Urken at the TP Minds Virtual Conference, April 2021
  • Transfer Pricing Insurance: A New Way of Thinking About Tax Certainty? panel including Perry Urken at NABE Transfer Pricing Symposium, July 2020
  • Economic Justifications for the OECD Digitization Initiative, panel including Perry Urken at the NABE Transfer Pricing Symposium, Washington, D.C., July 2019
  • Tax Reform Workshop: Territoriality, Integration and Transfer Pricing, panel including Perry Urken at the NABE Transfer Pricing Symposium, Washington, D.C., July 2017
  • Functional Analysis vs. Value Chain Analysis…and this DEMPE Thing, panel including Perry Urken at the NABE Transfer Pricing Symposium, Washington, D.C., July 2016
  • Transfer Pricing Issues and Solutions for Loss Making Entities, presented by Perry Urken with Bob Alltop and Brian Vincent at the International Fiscal Association’s Annual Meeting, Washington, D.C., March 2012
  • Transfer Pricing Controversy and Dispute Resolution, participated in a panel including Perry Urken at the IBC International Transfer Pricing Summit, London, March 2012
  • The Future of Intangibles & Comparison Between Jurisdictions, moderated panel including Perry Urken at the Asia-Pacific Transfer Pricing Summit, Hong Kong, October 2011
  • Use of Statistics in Transfer Pricing – A Primer, presented by Perry Urken with Mark Bronson at the NABE Transfer Pricing Symposium, Arlington, Virginia, July 2011
  • The Importance of the Ways and Means Committee Transfer Pricing Hearings, webinar presented by Perry Urken, September 2010
  • Economic and Transaction-Based Support for the Transfer of Business Risk Among MNC Affiliates, presented by Perry Urken at the Marcus Evans Transfer Pricing Conference, Washington, D.C., March 2010
  • Advance Pricing Agreements, presented by Perry Urken with Bob Alltop at the ATLAS Tax Symposium on International Transfer Pricing, Chicago, June 2009
  • Manufacturing and Distribution Conversion Models, presented by Perry Urken at the China Transfer Pricing & Risk Management Conference, Hong Kong, December 2008
  • Transfer Pricing Issues in the Private Equity Industry, presented by Perry Urken at the Private Equity Financial Management Summit, New York, May 2007 and May 2008
  • “The Impact of Chilean Tax Reform on Transfer Pricing Enforcement, Specificity of Methods,” CRA Insights, June 2012, by Brian Vincent
  • “ATO’s Exposure Draft Proposes Retrospective Amendments, Signals First Stage of Transfer Pricing Reform,” CRA Insights, April 2012, by Brian Vincent
  • “Proposed Change to US Customs Policy May Lead to Harmonization of Transfer Pricing, Customs Compliance,” CRA Insights, October 2011, by Brian Vincent
  • “Advance Pricing Agreements and Merger and Acquisition Activity: A Strategy for Mitigating Post-Integration Risk,” CRA Insights, June 2010, by Brian Vincent
  • “Evaluating Transfer Pricing Policies During the Post-Acquisition Integration Process: The Harmonization Debate,” CRA Insights, April 2010, by Brian Vincent
4Testimony Experience
  • Deposition testimony, Cypress Semiconductor vs. Altera Corporation, December 6, 2001
  • Testimony, Certain Emulsion Styrene-Butadiene Rubber from Brazil, Korea, and Mexico (Investigations Nos. 731-TA-794-796), International Trade Commission, April 22, 1999

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