Rocco Femia comments on the new transfer pricing regulations that went into effect at the start of this year, which take aim at cost sharing arrangements corporations often use to develop new intangible property. Although the IRS was responsive to some taxpayer comments on similar proposed regulations issued in 2005, the new regulations nevertheless will present issues for companies entering into new arrangements. While acknowledging that the revision is "quite modest" and that the new rules are still "draconian," Femia says the changes would provide companies with considerably more wiggle room. "The 2005 rules were more formulaic and prescriptive,” Femia says, noting that revised rules "do increase flexibility to some degree."