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Orange wins decade-long tax wrangle and a repayment of €2.2bn

News

The operator has secured a favourable and final decision by the French State Council (Conseil d'Etat) regarding a long-standing tax dispute.

Orange said it welcomes the decision reached by the French State Council regarding the dispute that began nearly ten years ago. This decision, which definitively closes the case, confirms the Group’s position since the beginning of this dispute. It will enable Orange to recover the amount paid in July 2013 of around €2.2 billion.

Allocating funds

The Group, which already has a rather more solid balance sheet than many European operator groups, plans to allocate these funds "in a fair and balanced manner in a way that will benefit the development of the company, its employees and its shareholders," it said in a statement, and in particular through an employee share scheme and an enhanced social commitment in light of the economic and health crisis.

These projects will be submitted to the Board of Directors in the next few weeks, it added.

The payment, made of up of the principal and interest, will be recorded as current tax income and will help reduce the company’s net debt, which stood at €26.4 billion at the end of H1 2020. The sums received will not be subject to tax. In 2019, Orange Group's sales turnover was €42 billion.

History

The battle with the tax authorities started in 2005 with the integration of Orange’s subsidiary, Cogecom, according to Reuters.

This led to heavy losses at the state-controlled group and subsequently a smaller basis on which taxes were calculated.