“In-depth knowledge of the different valuation methods and parameters is not enough: it is just as essential to understand all the factors, both internal and external, influencing the value of intellectual property.”

The valuation of a patent, of a trademark or of a whole portfolio of intellectual property rights can be carried out for different reasons, such as the need to license or assign an intellectual property right, sell an entire enterprise or include one or more patents or trademarks in the balance sheet.

There are different methods to valuate intellectual property rights: the choice depends also on the purpose of the valuation.

The parameters to be taken into account may vary and can include the characteristics of the relevant market, the enterprise’s position on the market, the foreseeable commercial life of its products, actual and foreseen turnover, the degree of risk of the sector; other strictly accounting and fiscal factors must also be considered.

Where an intellectual property right is being assigned or the entire enterprise is being sold, evaluation may require also a due diligence analysis.

The elements and aspects to be taken into consideration are therefore many and variable, and must be determined necessarily case by case.

PATENT BOX

Italy’s Patent box (as introduced by Law Decree 146/2021 and subsequently amended) applies to costs incurred, as part of the activities of the enterprise, for research and development of industrial patents, of designs and industrial models as well as of copyright-protected software.

Such costs are increased by 110% for the purposes of business income tax. The 110% deduction may be extended to costs incurred for research and development activities performed during the eight years prior to grant of the intellectual property right.

The option for the Patent box is also valid for IRES and IRAP purposes.

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