May 7, 2019

Significant expansion of performance and documentation requirements suggested for developing market based royalty rates

On behalf of the American Society of Appraisers, Raymond Rath of Globalview Advisors held a webinar on “Intangibles Valuations and the Mandatory Performance Framework” on June 12th, 2018. In the context of royalty rates, Ray made the following statements, among others:

Determining royalty rates is challenging due to the frequent lack of meaningful guideline licensing transactions
MPF suggests significant expansion of performance and documentation requirements for developing market based royalty rates
Alternative methods such as the Distributor Method and “Enhanced Profit Splits” may merit increased consideration
“25% Rule” seems to be outdated and unsupportable

See Ray’s webinar presentation here. MARKABLES has a lot of corroborative data to overcome the lack of guideline licensing transactions.

Significant expansion of performance and documentation requirements suggested for developing market based royalty rates

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