Coca-Cola vs The Commissioner: What Went Wrong?
May 19, 2025 11:00am ESTIn 2020, Coca-Cola was ordered to pay the IRS $3 billion in back taxes—which was later adjusted to $9 billion—for undercharging its foreign subsidiaries for U.S.-owned IP. The structure resulted in the underpayment of U.S. taxes. In this exciting webinar, Economist Dr. Ednaldo Silva, Exactera COO Mimi Song, and Paul Sutton, a corporate attorney and leading expert in intercompany agreements at LCN, unpack the case from an economic and legal perspective. What went wrong for Coca-Cola? Why did the IRS challenge the company’s transfer pricing methodology? How can other taxpayers learn from its mistakes? Had the IRS and Coca-Cola relied on royalty rates as a primary method of arm’s length comparison, would the outcome have been better for the taxpayer?
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Learning Objectives
To understand how Coca-Cola vs the Commissioner impacts all taxpayers engaging in intercompany transactions.
To define critical factors in the case.
Learn about valuing and documenting intercompany transactions involving intangibles—and how reliable royalty rates can play a role in arm’s length pricing.
Discuss the importance of reliable data and designing commercially rational transactions.
To understand how to properly analyze transactions involving IP.
To understand how to integrate contractual terms and economic substance.
The Host
Ednaldo Silva, Ph.D.
Senior Tax Economist
Dr. Ednaldo Silva is a leading international expert in transfer pricing with over 30 years of experience in both the public and private sector. He holds a PhD in economics from University of California, Berkley and was the founder of RoyaltyStat, the first-to-market database of royalty rates for transfer pricing compliance. Dr. Silva began his transfer pricing career as the first senior economic adviser in the Internal Revenue Service (IRS) Office of Chief Counsel and then as the first economist in the IRS Advanced Pricing Agreement program. During this time, he was a drafting member of the 1994 US transfer pricing regulations and introduced the ‘comparable profits method’ and ‘best method’ rule. In his private practice and as managing director of EdgarStat, he has served as senior tax economist to law firms, large multinational corporations and economic consultant in high-profile controversy and litigation, including the $3.4 billion settlement in GlaxoSmithKline Holdings (Americas) Inc v Commissioner of Internal Revenue.
Paul Sutton
Corporate Attorney
Paul Sutton is a corporate lawyer with over 30 years' international experience. He is a leading expert in intercompany agreements and legal structures for multinational groups and financial institutions. He is the co-founder of LCN, and the author of “Intercompany Agreements for Transfer Pricing Compliance – A Practical Guide” which is published by Law Brief Publishing. Paul works alongside leading international tax and transfer pricing professionals globally, helping to make sure that the transfer pricing policies of the groups concerned have legal substance and are implemented through appropriate intercompany agreements - which are kept up to date, and tax audit-ready and due diligence-ready. He writes and speaks regularly on the subject of legal structures for multinational groups and the legal implementation of transfer pricing. This includes speaking at conferences, and facilitating webinars, seminars and workshops for transfer pricing, tax, finance and legal professionals.
Mimi Song
Chief Operating Officer
As Exactera’s chief operating officer, Mimi Song is responsible for driving ongoing product innovation and developing business strategy, including identifying new opportunities for mergers and acquisitions. A visionary behind Exactera’s transfer pricing solution suite, including the revolutionary AI-powered ExactMatch, Song plays a key role in finding synergies between tax and technology and positioning Exactera as a leader in the corporate tax space. Prior, as chief economist, Song managed client relationships and ensured the successful implementation of transfer pricing solutions. A huge proponent of transfer pricing education, Song leads discussions with world-renowned global tax experts on podcasts and webinars and has been the star of in-depth speaking engagements at global tax events. Prior to Exactera, Song led the transfer pricing team at the Bank of Tokyo-Mitsubishi UFJ. She has written numerous articles on tax and transfer pricing for Bloomberg Tax and Treasury & Risk, among others, and has been quoted as an economic expert online for Forbes, The Wall Street Journal, and CNN.