Nokia Offers Down-payment to Unfreeze Indian Factory Assets
Published on: 10th Dec 2013
By: Ian Mansfield
Nokia is reported to have offered to make a payment to the Indian courts to secure the release of assets that have been seized by the tax authorities.
The payment doesn't indicate that Nokia is accepting the tax dispute is valid, but would simply by a deposit that it would expect to be refunded if it wins the case.
Unlocking the assets is important as they are part of the sale to Microsoft of Nokia's handset business, and while the sale would still go ahead, the lack of the handset factory could complicate matters.
Citing unnamed sources, Bloomberg News said that Nokia has offered to make a payment of around USD490 million with the court which is hearing the tax dispute.
Nokia is charged with avoiding USD342 million in taxes in how it handles software costs for phones assembled at its Chennai. Nokia disputes the tax demand, citing a tax agreement between Finland and India to avoid double-taxation issues.
Nokia recently warned that the inconsistency in how tax regulations are applied in the country could lead it to reconsider future investments.
On the web: Bloomberg News