CLARIFICATION ON THE ARTICLE PUBLISHED IN THE EDGE FINANCIAL DAILY ON 8 FEBRUARY 2019 ENTITLED 'AXIATA ORDERED TO FOOT RM2.16 BILLION TAX BILL IN NCELL BUYOUT DEAL'
In relation to the article published on the front page in the Edge Financial Daily on 8 February 2019 entitled ‘Axiata ordered to foot RM2.16 billion tax bill in Ncell Buyout Deal’, we wish to clarify that none of the Axiata parties to the litigation has received the judgment and order of the Supreme Court of Nepal (“Supreme Court”) following its ruling, nor does the Axiata Group have any details of what was ordered by the Supreme Court.
The alleged judgement and order by the Supreme Court was on two writ petitions by Axiata’s 80% subsidiary, NCell Private Limited (“Ncell”) [held via Reynolds Holdings Limited (“Reynolds”)], Reynolds and two Public Interest Litigations (“PIL”) brought against various parties in relation to the Capital Gains Tax (“CGT”) claim following the completion of the sale of Reynolds to Axiata’s wholly-owned subsidiary, Axiata Investments (UK) Limited (“Axiata UK”) on 12 April 2016 (“Transaction”).
Reynolds is the 80% parent company of Ncell, formerly owned by TeliaSonera Norway Nepal Holdings AS, a large European telecommunications group (“Seller”).
In its ruling on 6 February 2019, the Supreme Court had dismissed both the writ petitions by Reynolds and Ncell, and one of the PILs. However, Axiata understands that the Supreme Court has ruled in favour of the PIL filed by Mr Dwarikanath Dhungel and others broadly pleading that the onus of payment of CGT is on Ncell, Reynolds and Axiata UK.
Ncell and therefore, Reynolds, and Axiata UK were given the full clearance by the Large Tax Payers Office of Nepal [“LTPO”] of its obligations to withhold any CGT payment on behalf of the Seller in relation to the Transaction via the letter from LTPO dated 4 June 2017, following the full and final payment made by Ncell, albeit under protest on the basis that CGT is not applicable on offshore transactions and even if applicable, any payment is the responsibility of the Seller.
Axiata will make further announcements should there be any material update in this matter.
This announcement is dated 8 February 2019.
|Company Name||AXIATA GROUP BERHAD|
|Date Announced||08 Feb 2019|
|Category||General Announcement for PLC|