DHL Corporation and Subsidiaries - Page 171

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          further contends that there was no cost-sharing arrangement                 
          between DHL and DHLI.  Finally, respondent contends that                    
          petitioners failed to show that DHLI either developed or assisted           
          in developing the intangible (trademark) because it has not been            
          shown that the advertising expenditures incurred by DHLI were               
          more than what would have been incurred at arm’s length; i.e.,              
          allocation from DHL to DHLI is not appropriate.                             
               Petitioners counter that respondent may not choose either to           
          “invoke” the section 482 regulations and make an allocation based           
          on the developer/assister standard, or to ignore those                      
          regulations and make an allocation “pursuant to” the parties’               
          licensor/licensee relationship.  Petitioners rely on the language           
          of section 1.482-2(d)(1)(ii)(a), Income Tax Regs., that “no                 
          allocation * * * shall be made” with respect to a transfer of               
          intangible property unless either (1) there is a “bona fide cost            
          sharing arrangement” as defined in section 1.482-2(d)(4), Income            
          Tax Regs., or (2) the intangible has been transferred by the                
          “developer” within the meaning of section 1.482-2(d)(1)(ii)(c),             
          Income Tax Regs.  Petitioners contend that respondent has denied            
          the existence of a bona fide cost-sharing arrangement in these              
          cases and that, therefore, any section 482 allocation must be               
          based on the developer/assister standard.  Finally, petitioners             
          contend that respondent, under the regulations, may make an                 
          allocation (reduction of value) for an “assistance” provided by             
          DHLI if DHLI is not considered the “developer” of the intangible.           




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