Countries: Sweden

Sweden vs “A Share Loan AB”, December 2022, Supreme Administrative Court, Case No 3660-22

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As a general rule interest expenses are deductible for the purposes of income taxation of a business activity. However, for companies in a group, e.g. companies in the same group, certain restrictions on the deductibility of interest can apply. In Sweden one of these limitations is that if the debt relates to the acquisition of […]

Sweden vs TELE2 AB, November 2022, Court of Appeal, Case No 1298-21

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The Swedish group TELE2, one of Europe’s largest telecommunications operators, had invested in an entity in Kazakhstan, MTS, that was owned via a joint venture together with an external party. Tele2 owned 51% of the Joint venture and MTS was financed by Tele2’s financing entity, Tele2 Treasury AB, which, during 2011-2015, had issued multiple loans […]

Sweden vs Swedish Match Intellectual Property AB, May 2022, Supreme Administrative Court, Case No MĂĄl: 5264–5267-20, 5269-20

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At issue was whether the acquisition value of an inventory acquired from a related company should be adjusted on the basis of Swedish arm’s length provisions or alternatively tax avoidance provisions According to the arm’s length rule in Chapter 18, Section 11 of the Income Tax Act, the acquisition value is to be adjusted to […]

Sweden vs Flir Commercial Systems AB, January 2022, Administrative Court of Appeal, Case No 2434–2436-20

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In 2012, Flir Commercial Systems AB sold intangible assets from a branch in Belgium and subsequently claimed a tax relief of more than SEK 2 billion in fictitious Belgian tax due to the sale. The Swedish Tax Agency decided not to allow relief for the Belgian “tax”, and issued a tax assessment where the relief […]

Sweden vs TELE2 AB, January 2021, Administrative Court, Case No 13259-19 and 19892-19

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The Swedish group TELE2, one of Europe’s largest telecommunications operators, had invested in an entity in Kazakhstan, MTS, that was owned via a joint venture together with an external party. Tele2 owned 51% of the Joint venture and MTS was financed by Tele2’s financing entity, Tele2 Treasury AB, which, during 2011-2015, had issued multiple loans […]

Sweden vs Branch of Yazaki Europe Ltd, October 2019, Court of Appeal, Case No 2552–2555-17, 2557–2558-17, 3422-18

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The Swedish Branch of Yazaki Europe Ltd had been heavily lossmaking for more than five years. The Branch only had a limited number of customers in Sweden and where it acted as a simple information exchange provider. The branch had limited risks, as all risk related to R&D functions were located outside Sweden. Excerpt from […]

Sweden vs Branch of Technology Partners International Europe Ltd, October 2019, Court of Appeal, Case No 3701-18

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The Swedish branch of Technology Partners International Europe Ltd. was loss-making. The branch had no significant people functions but only two employees performing low value-added services. From the Judgement of the Court of Appeal “The distribution of revenue and costs between a British company and its Swedish branch is regulated for the current tax years […]

Flir Systems Inc in SEK 2.8 billion transfer pricing dispute with Swedish Tax Authorities.

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Flir Systems Inc, a global leader in infrared Cameras, is involved in a SEK 2.8 billion transfer pricing dispute with the Swedish Tax Authorities. In a recent 10Q filings Flir Systems Inc. provides information on the dispute: “…the United States Internal Revenue Service (“IRS”) and other tax authorities regularly examine our income tax returns. Our […]

Sweden vs. Absolut Company AB, Jan 2018, Administrative Court, No. 1610-16

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In 2016 the Swedish Tax Tribunal ruled against the tax administration in the case of The Absolut (vodka) Company AB. The Administrative Court of Appeal has now overturned the Tribunal’s ruling and consequently SEK 247 mio. are now added to the taxable income of The Absolut Company AB. The Swedish tax administration found that The Absolut Company […]

Sweden vs VSM Group AB, July 2017, Administrative Court of Appeal, Case No 2038–2041-15

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An agreement between a Swedish company, VSM Group AB, and an American distributor, VSM Sewing Inc, stated that the distributor would receive compensation corresponding to an operating margin of three percent. Benchmark studies showed that the agreed compensation was arm’s length. Each year, the company made a year end adjustment to ensure that the pricing […]

Sweden vs. taxpayer april 2016, Swedish Supreme Administrative Court, HFD 2016 ref. 23

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The Swedish Supreme Administrative Court makes it clear that OECD guidelines can be used for interpreting Swedish domestic legislation in cases where the domestic legislation is based on OECD guidance and principles. It is also concluded, that the fact that an agreement is given a certain legal term does not mean that the Court is bound by […]

Sweden vs Nordea Nordic Baltic AB, October 2015, Administrative Court of Appeal, Case No 4811-14, 4813–4817-14

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Nordea Nordic Baltic AB was the manager of funds and a central distributor in Sweden of certain funds registered in Luxembourg. The company entered into a new distribution agreement that replaced two previous agreements. According to this new agreement, the remuneration to the company was lower than under the previous agreement. The company considered that […]

Sweden vs AB Tetra Pak, April 2015, Administrative Court of Appeal, Case No 1168-14

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An agreement had been entered between AB Tetra Pak and Tetra Pak International, according to which AB Tetra Pak conducted research and development on behalf of Tetra Pak International and was compensated on a cost plus 3 percent basis. The Swedish Tax Agency, after examining four comparable businesses and their profit levels, concluded that the […]

Sweden vs. Diligentia, June 2010, Regeringsratten case nr 2483-2485-09

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Diligentia was the parent company of a Group active in real estate. After a take-over of Diligentia by another Group, Skandia Liv, external loans in Diligentia were terminated and replaced with intra-group loans from the new parent company, Skandia Liv. The new loans had an interest rate of 9,5 percent compared to the interest rates before the take over where […]