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DHL’s interest. A buyer could be financially burdened with
perfecting its right to those registrations in some or all of the
195 countries. The potential for delay, expense, inconvenience,
etc. could be immense and would present a huge potential for out-
of-pocket expenses or other costs to a potential willing buyer.
To adequately reflect those legal problems and potential
costs, a 50-percent marketability discount is appropriate.
Because the international portion of the DHL network produces
about two-thirds of the business and/or profit, $100 million of
the $150 million fair market value of the DHL trademark can
reasonably be attributed to that portion. Applying a 50-percent
marketability discount to the $100 million foreign portion
results in a discounted value for the DHL trademark of $100
million worldwide, and we so hold.
1. Effect of Section 482 Regulations on Allocation of
Value
Next, we consider the parties’ collateral arguments
concerning the amounts allocable under section 482 and underlying
regulations. Petitioners rely on a portion of the regulations
that provide that when one member of a controlled group transfers
intangible property to another member of the group, the district
director may make “appropriate allocations to reflect an arm’s
length consideration for such property or its use.” Sec. 1.482-
2(d)(1)(i), Income Tax Regs. More specifically, petitioners
argue that the district director may not make such an allocation
unless or until the “developer” of the intangible property has
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