Countries: Malaysia

Malaysia vs Ensco Gerudi Malaysia SDN. BHD., July 2021, Juridical Review, High Court, Case No. WA-25-233-08-2020

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Ensco Gerudi provided offshore drilling services to the petroleum industry in Malaysia, including leasing drilling rigs, to oil and gas operators in Malaysia. In order to provide these services, the Ensco entered into a Master Charter Agreement dated 21.9.2006 (amended on 17.8.2011) (“Master Charter Agreement”) with Ensco Labuan Limited (“ELL”), a third-party contractor, to lease drilling rigs from ELL. Ensco then rents out the drilling rigs to its own customers. As part of the Master […]

Malaysian Energy Group – TENAGA Nasional Bhd – has been issued a RM 4.000.000.000 tax bill by the Revenue Board of Malaysia

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Malaysian Energy Group – TENAGA Nasional Bhd – has begun legal proceedings against the Inland Revenue Board of Malaysia. In November 2019, the Inland Revenue Board issued a tax assessment  according to which taxes of RM3.98 bil (or USD 1 billion) is owed for years 2015-2017. After reciving the assessment, TENAGA responded “Based on the legal advice obtained from our tax solicitors, TNB has a good basis to contend that there is no legal and factual […]

Malaysia vs Shell Services Asia Sdn Bhd, November 2019, High Court, Case No BA-25-68-08/2019

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The principal activity of Shell Services Asia Sdn Bhd in Malaysia is to provide services to related companies within the Shell Group. For FY 2011 – 2016 the company was part of a contractual arrangement for the sharing of services and resources within the Shell Group as provided in a Cost Contribution Arrangement. The tax authorities conducted a transfer pricing audit, and based on the findings, issued a tax assessment, where the Cost Contribution Arrangement had instead […]

Malaysia vs Shell Timur Sdn Bhd, June 2019, High Court, Case No BA-25-81-12/2018

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In FY 2005 Shell Timur Sdn Bhd in Malaysia had sold its economic rights in trademarks to a group company, Shell Brands International AG. The sum (RM257,200,000.00) had not been included in the taxable income, but had – according to Shell – been treated as a capital receipt which is not taxable. The tax authorities conducted a transfer pricing audit beginning in June 2015 and which was finalized in 2018. Following the audit an assessment […]

Malaysia vs Ensco Gerudi, June 2016, High Court, Case No. 14-11-08-2014

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Ensco Gerudi provided offshore drilling services to the petroleum industry in Malaysia. The company did not own any drilling rigs, but entered into leasing agreements with a rig owner within the Ensco Group. One of the rig owners in the group incorporated a Labuan company to facilitate easier business dealings for the taxpayer. Ensco Gerudi entered into a leasing agreement with the Labuan company for the rigs. Unlike previous transactions, the leasing payments made to […]

Malaysia vs Syarikat Ibraco-Peremba, May 2014, Court of Appeal, Case No. W-01-177-04/2013

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Syarikat Ibraco-Peremba was a property development company in Malaysia. The company had entered into a series of elaborate transactions to avoid paying income tax on the profits made from the sale of a developed land. Profits arising from the companies sale of developed land would be treated as business income and subject to income tax. The company first incorporated a subsidiary and then, after selling the lands to the subsidiary, entered into a contract with […]