Regulations Governing Assessment of Profit-Seeking Enterprise Income Tax on Non-Arm's-Length Transfer Pricing Article 9-2

When profit-seeking enterprises and the collection authorities-in-charge evaluate whether the allocation of profits by the transaction of Intangible Assets is consistent with the Arm’s-length principle, they shall conduct comparability analysis based on the economic activities involving the development, enhancement, maintenance, protection, and exploitation of Intangible Assets in accordance with Article 8 and Article 8-1; in particular, attention shall be drawn to the degree of contributions of functions performed, risks assumed, and assets used of previous economic activities, and the Arm's-length result shall be determined based on the comparability analysis.When evaluating Intangible Assets transactions, the following risks shall be particularly considered:1. risks related to development of intangibles;2. risks of product obsolescence;3. infringement risk;4. product liability risks; and5. exploitation risks.