When most artists sign record deals, they hand over these rights in exchange for an advance payment, a smaller royaltyof 10-15% on music sales and the prestige of recording an album for a major record label.
The amount of the advance royaltypayment generally is subject to U.S. tax in the year received (but there would be no further taxable royalty income in years 2 and 3).
For any drugs that are produced on the GlycoFi platform and make it to the market, Merck will be paying GlycoFi an annual royaltypayment on the sales of each of those drugs.
In addition, they have written statutes and regulations that require taxpayers to prove not only that foreign levies are income taxes but also that no amount of the payment is a fee (such as a royalty) for a specific economic benefit.
These interest and royalty payments shall be exempt from any taxes in that State provided that the beneficial owner of the payment is a company or permanent establishment in another Member State.