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In the tax-related disputes between the Government of India, the Nokia has suffered a significant "reversal, was forced to stop its assets transferred in the Indian market, Microsoft, which prompted the company to the Supreme Court of India appealed .
This reversal of the future in the southern Indian city of Chennai Nokia's main manufacturing facility poses a threat, this manufacturing facility currently employ a total of about 30,000 employees. As part of Microsoft's 5.4 billion euros (about 7.3 billion U.S. dollars) to buy Nokia's mobile phone business, the plant should be transferred to Microsoft.
Engaged in business activities in the Indian market, overseas companies, this is the second tax-related bad news followed for just one day time. Earlier reports said, in a pile between the Government of India involving up to about $ 2.6 billion of long-term tax disputes, negotiations between the British Vodafone Group and the government broke down.
In addition to Nokia and Vodafone Group, many global companies are faced with a dispute between India and the tax authorities, such as the Dutch Shell and the U.S. technology giant IBM. These disputes have been seriously damaged as Asia's third largest economy, India's reputation in the international enterprise, it is questioned whether the country for foreign investment also have a friendly attitude.
In December last year, Nokia get between it and the Government of India involving up to $ 1.1 billion tax dispute an important 'probation, was a ruling by a court in New Delhi, said the company can transfer the assets of the Chennai plant . But another Indian court said in its judgment last week, Nokia's awful exception handling tax disputes should be ruled planned transfer of assets of the company is "unacceptable, thus contributing to the Supreme Court of India Nokia appealed.
Nokia said: "According to the latest ruling of the court, we will not be able to transfer the company's assets, which would seriously jeopardize the continuity of the company's business and cause 30,000 employees face danger. Unfortunately, the current situation we are facing is that unless we can win the lawsuit in the Supreme Court, or unless the tax authorities and the Ministry of Finance to change their minds, otherwise the asset transfer activities will temporarily unable to continue.
Nokia said the company's chairman Risto Siilasmaa Wednesday in New Delhi with Indian government officials held talks, he urged the latter to change their minds. Nokia stressed that the transfer of assets and related matters will not have a significant impact on the agreement between the company and Microsoft deal; But the company also said that the investment of international companies in the Indian market, it will be an apparent another negative signal.
Nokia said: "It seems to cooperate with the Indian tax authorities would be very difficult and unpredictable thing, which is obviously not a good thing for businesses. Nokia still in a statement, adding that the tax authorities in India has experienced more than a year in the past taken action after radical arbitrary, "the company" can not tolerate this situation, we can not give up the self-protection legal rights. The statement said: "Nokia believes that these actions violated the Indian domestic laws and international conventions, including tax and investment agreement between India and the Government of Finland, including.
Nokia in the Indian market is faced with the dilemma of tax from the beginning of last January, when the Chennai plant was raided. Subsequently, the Indian tax authorities issued an order freezing all assets of this kind of work. Nokia said at the time the action taken by the Indian tax authority officials "excessive, unacceptable and inconsistent.
A court ruling last week in India, Nokia asked to open a guarantee, commitment of the company to meet the requirements of any future tax dispute relating to the above. Nokia after the verdict in the study said that its terms will result in the company's future can not be made against any tax-related requirements of self-defense, and therefore unwilling to accept the verdict. The dispute was originally from the relevant tax Nokia need to be turned over to the Indian subsidiary of the parent company expenses
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