Nov 06, 2024 11:15:00

Netflix offices in France and Netherlands raided over suspected tax evasion

On November 5, 2024, the offices of streaming service giant Netflix in France and the Netherlands were raided on suspicion of tax evasion. Netflix's French division is suspected of cooperating with its Dutch division to avoid paying taxes in France.

Netflix under tax fraud investigation as offices in France and Netherlands raided | Reuters

https://www.reuters.com/business/media-telecom/investigators-search-netflix-offices-france-netherlands-source-2024-11-05/

French and Dutch authorities raid Netflix offices in tax probe
https://www.lemonde.fr/en/international/article/2024/11/05/french-and-dutch-authorities-raid-netflix-offices-in-tax-probe-judicial-source_6731662_4.html

Netflix Offices in Paris, Amsterdam Raid in Tax Fraud Case - Bloomberg
https://www.bloomberg.com/news/articles/2024-11-05/netflix-offices-in-paris-amsterdam-raided-in-tax-fraud-case

A French judicial official told international media that Netflix's offices in France and the Netherlands were raided on November 5. The raids were conducted jointly by French and Dutch authorities as part of a preliminary investigation into tax evasion.

The preliminary investigation is being led by France's special financial crimes prosecutorial unit, Parquet National Financier (PNF) . Founded in 2014, the PNF deals with large-scale financial crimes, mainly involving large international companies, and the investigation into Netflix has been ongoing since November 2022.

A French source said: 'Cooperation between French and Dutch authorities on criminal matters related to these proceedings has been going on for several months and is coordinated by the European Justice Mechanism .' Dutch authorities declined to comment.

Meanwhile, a spokesperson for Netflix's French division told foreign media outlet Reuters, 'We are cooperating with the French authorities, where Netflix makes a significant contribution to the local economy and we comply with tax laws and regulations in every country in which we operate.'

Netflix is accused of unfairly underpaying corporate taxes to the French government.

According to French media

La Lettre , Netflix under-declared its sales by having French customers sign contracts with a Dutch subsidiary between 2019 and 2020, and paid less than 1 million euros in corporate tax in France.

Since 2021, this practice has been eliminated, and revenues in France have jumped from 47.1 million euros (about 7.8 billion yen) the previous year to 1.2 billion euros (about 199 billion yen), reaching 1.3 billion euros (about 215 billion yen) in 2022. This figure is in line with the number of French subscribers announced by Netflix, La Lettre reports.

The search is only part of a preliminary investigation and may not necessarily lead to criminal charges. The PNF did not provide details about the scope of the investigation.