Tag: Tax fraud

Credit Suisse enters EUR 238 million settlement agreement in France

Credit Suisse enters EUR 238 million settlement agreement in France

A settlement agreement between the French Financial Public Prosecutor and Credit Suisse was announced in the Paris Court of Appeal 24 October 2022. The “CJIP” agreement brings an end to investigations in France over whether the Swiss bank facilitated and aided clients in tax avoidance. (English translation of the press release from the French Public Prosecutor) On 24 October 2022, the President of the Paris Judicial Court validated the judicial public interest agreement (CJIP) concluded on 21 October 2022 between the Financial Public Prosecutor (PRF) and CREDIT SUISSE AG pursuant to Article 41-1-2 of the Criminal Procedure Code. Under the terms of the CJIP, CREDIT SUISSE AG undertakes to pay the Treasury a public interest fine totaling EUR 123,000,000. In addition, CREDIT SUISSE AG undertakes to pay to the Treasury the sum of €115,000,000 in damages owed to the State. As a result, the public interest fine and the damages amount to the total sum of €238,000,000. Subject to the ... Read more
McDonald’s has agreed to pay €1.25bn to settle a dispute with French authorities over excessive royalty payments to Luxembourg

McDonald’s has agreed to pay €1.25bn to settle a dispute with French authorities over excessive royalty payments to Luxembourg

On 16 June 2022 McDonald’s France entered into an settlement agreement according to which it will pay €1.245 billion in back taxes and fines to the French tax authorities. The settlement agreement resulted from investigations carried out by the French tax authorities in regards to abnormally high royalties transferred from McDonald’s France to McDonald’s Luxembourg following an intra group restructuring in 2009. McDonald’s France doubled its royalty payments from 5% to 10% of restaurant turnover, and instead of paying these royalties to McDonald’s HQ in the United States, going forward they paid them to a Swiss PE of a group company in Luxembourg, which was not taxable of the amounts. During the investigations it was discovered that McDonald’s royalty fees could vary substantially from one McDonald’s branch to the next without any justification other than tax savings for the group. This conclusion was further supported by statements of the managers of the various subsidiaries as well as documentation seized which ... Read more

TPG2022 Chapter IV paragraph 4.23

Civil monetary penalties for tax understatement are frequently triggered by one or more of the following: an understatement of tax liability exceeding a threshold amount, negligence of the taxpayer, or wilful intent to evade tax (and also fraud, although fraud can trigger much more serious criminal penalties). Many OECD member countries impose civil monetary penalties for negligence or willful intent, while only a few countries penalise “no-fault” understatements of tax liability ... Read more

TPG2017 Chapter IV paragraph 4.23

Civil monetary penalties for tax understatement are frequently triggered by one or more of the following: an understatement of tax liability exceeding a threshold amount, negligence of the taxpayer, or wilful intent to evade tax (and also fraud, although fraud can trigger much more serious criminal penalties). Many OECD member countries impose civil monetary penalties for negligence or willful intent, while only a few countries penalise “no-fault” understatements of tax liability ... Read more