Japan vs “NGK-Insulators”, November 2020, Tokyo District Court, Case No 平成２８年（行ウ）第５８６号 – 586 of 2016

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Category: Intangibles - Goodwill Know-how Patents, Royalty and License Payments, Transfer Pricing Methods | Tag: , , , , , ,
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“NGK-Insulators” is engaged in manufacturing and selling parts to the automotive industry (Diesel Particulate Filters or DPF’s) and had entered into an agreement with a group company in Poland where it granted the Polish company a licenses to use intangibles (know-how and technology) in return for license/royalty payments.

The tax authorities found that the amount of the consideration paid to “DPF Corp” for the licenses had not been at arm’s length and issued an assessment of additional taxes.

“NGK-Insulators” filed a complaint which the district court.

Judgement of the Court

The Court ruled in favour of “NGK-Insulators” and set aside the assessment issued by the tax authorities.

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