Common use of technology

A Danish based Group wanted to integrate technology from a recently acquired subsidiary in its global technology portfolio. The acquired technology would in some cases also replace the existing technology.

Tax considerations involved the value of the technology of both parties and whether fees should be paid for technology belonging to the other party when technology was retired. Also, considerations of fees to be paid when a common library of technology was established which the parties could access and use in common and own products.

Finally, the ownership to new technology was analysed in-depth and the possible legal and economic transfer of ownership was assessed. The ownership to technology had a significant impact on the rest of the tax and transfer pricing setup and ended up impacting the intercompany pricing setup and the global development organisation.