1. Veritas v. Commissioner

2. In November 1999, Veritas Software Corp. (Veritas US – now prt of Symantec Corp.) and its wholly owned foreign subsidiary Veritas Ireland entered into a cost sharing agreement (CSA) Veritas US granted Veritas Ireland the right to use certain existing intangibles and charged Veritas Ireland the buy-in payment Veritas US won Overview

3. Veritas’ Argument: Veritas alleges that the value of the buy-in payment in question should be US$118 million based on their CUT (comparable uncontrolled transaction) pricing method. IRS Argument: The IRS alleges that the buy- in payment in question should be valued at US$ 2.5 billion based on their income-based valuation method that took the following into account: – Buyin comparable to 3rd party acquisitions – Useful life – Workforce in place The Arguments

4. Court Decision/ Opinion The US Tax Court supported the CUT (comparable uncontrolled transaction) pricing method taken by Veritas and rejected the income method taken by the IRS used for determining the requisite buy-in payment relating to VERITAS Ireland’s transfer of intangibles to VERITAS US.

5. Implications This case laid some of the groundwork for determining when a bottom-up (Veritas) versus a top-down (IRS) approach should be used.

6. Further Reference Further reference on this case can be found at http://www.ustaxcourt.gov/InOpHistoric/veritas.TC.WPD.pdf

7. About IPR Plaza IPR Plaza is a web-based platform that bridges the gap between IP law, accounting, tax, transfer pricing and valuation by providing general and profession-specific information on intangibles, as well as, quantifiable valuation models. IPR Plaza is empowered by different leading IP advisory firms. IPR Plaza is headquartered in the Netherlands with representation in other major countries.