Cost Sharing Agreement Law

For example, a projection of operating income may require a projection of revenue, revenue costs, operating costs, and other factors affecting operating income. If there are expected to be significant differences between the controlled participants at the time of their acquisition and, therefore, it is expected that the benefit shares will vary significantly over the years in which the benefits will be obtained, it may be necessary to use the current discount value of the projected benefits to reliably determine each controlled participant`s share of those benefits. If advantage shares are not expected to change significantly over time, current annual benefit shares can provide a reliable forecast of expected benefit actions. This situation is most likely to occur where the cost-sharing agreement is a long-term agreement covering a large number of intangible assets, the composition of the intangible assets covered is unlikely to change, the intangible assets covered are unlikely to generate unusual profits, and the market share of each controlled participant is stable. (3) New participant controlled. Where a new controlled participant enters into a qualified cost-sharing agreement and acquires an interest in the covered intangible assets, the new participant shall pay a counter-transaction, in accordance with paragraphs 1.482-1 and 1.482-4 to 1.482-6, for such interests, to any controlled participant whose interest has been acquired. . . .

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