Financial crime authorities raid Netflix offices in Paris and Amsterdam
Investigation by special financial crime prosecution unit said to centre on tax fraud
05 November 2024 - 21:22
byFlorence Loeve and Sudip Kar-Gupta
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Paris — Investigators searched the offices of Netflix in France and the Netherlands as part of a preliminary investigation into tax fraud, a French judicial source said on Tuesday.
The French investigation, carried out by the PNF, a special financial crime prosecution unit known for pursuing white-collar probes that often involve large international companies, was opened in November 2022.
Representatives for Netflix in France and the Netherlands did not immediately respond to phone calls and emailed requests for comment.
Investigators specialising in financial crime and corruption raided the US streaming giant’s offices in central Paris on Tuesday.
At the same time Dutch authorities were searching the company’s European headquarters in Amsterdam, the French judicial source said.
“Co-operation between the French and Dutch authorities has been under way for many months as part of these proceedings,” the French source said. The office of the Dutch prosecutor for financial crime declined to comment and referred questions to the PNF.
A preliminary investigation in France does not imply criminal charges and does not necessarily lead to a trial.
The facts which led to the investigation aren’t immediately clear, though big tech companies offering their online services and subscriptions across borders often run into difficulties with European tax authorities.
News website La Lettre reported last year that Netflix’s French subsidiary was the subject of scrutiny from tax authorities regarding its low reported turnover, which the media said was at odds with paying user numbers in the country.
Between 2019 and 2020, Netflix Services France paid less than €1m in corporate taxes, by involving a separate unit registered in the Netherlands, La Lettre said. The company stopped the practice in 2021, it added.
Corporate records show the revenue of Netflix’s French unit surged to about €1.2bn euros in 2021 from €47m the year before.
Netflix in France didn’t respond to a request for comment on the alleged reporting of revenues through Amsterdam rather than France in 2019 and 2020.
The PNF declined to give details on the scope of its investigation.
In 2022, Netflix had agreed to settle a tax dispute with Italy by paying €55.8m.
Netflix said on its website that it opened its Paris bureau, located just around the corner from the Opera Garnier, in 2020 when it employed about 40 staff.
The company produces most of its original films and series, including the global blockbuster Emily in Paris by working with third-party contractors.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Financial crime authorities raid Netflix offices in Paris and Amsterdam
Investigation by special financial crime prosecution unit said to centre on tax fraud
Paris — Investigators searched the offices of Netflix in France and the Netherlands as part of a preliminary investigation into tax fraud, a French judicial source said on Tuesday.
The French investigation, carried out by the PNF, a special financial crime prosecution unit known for pursuing white-collar probes that often involve large international companies, was opened in November 2022.
Representatives for Netflix in France and the Netherlands did not immediately respond to phone calls and emailed requests for comment.
Investigators specialising in financial crime and corruption raided the US streaming giant’s offices in central Paris on Tuesday.
At the same time Dutch authorities were searching the company’s European headquarters in Amsterdam, the French judicial source said.
“Co-operation between the French and Dutch authorities has been under way for many months as part of these proceedings,” the French source said. The office of the Dutch prosecutor for financial crime declined to comment and referred questions to the PNF.
A preliminary investigation in France does not imply criminal charges and does not necessarily lead to a trial.
The facts which led to the investigation aren’t immediately clear, though big tech companies offering their online services and subscriptions across borders often run into difficulties with European tax authorities.
News website La Lettre reported last year that Netflix’s French subsidiary was the subject of scrutiny from tax authorities regarding its low reported turnover, which the media said was at odds with paying user numbers in the country.
Between 2019 and 2020, Netflix Services France paid less than €1m in corporate taxes, by involving a separate unit registered in the Netherlands, La Lettre said. The company stopped the practice in 2021, it added.
Corporate records show the revenue of Netflix’s French unit surged to about €1.2bn euros in 2021 from €47m the year before.
Netflix in France didn’t respond to a request for comment on the alleged reporting of revenues through Amsterdam rather than France in 2019 and 2020.
The PNF declined to give details on the scope of its investigation.
In 2022, Netflix had agreed to settle a tax dispute with Italy by paying €55.8m.
Netflix said on its website that it opened its Paris bureau, located just around the corner from the Opera Garnier, in 2020 when it employed about 40 staff.
The company produces most of its original films and series, including the global blockbuster Emily in Paris by working with third-party contractors.
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