Royal Dutch Shell Group .com Rotating Header Image

Daily Telegraph: Shell could face huge tax bill

By Christopher Hope, Industry Editor (Filed: 27/03/2006)
Shell could be landed with a tax bill running into hundreds of millions of pounds because of a decision by the Chancellor to change the rules on how some foreign companies are taxed. Tax experts believe the main victim could be Shell, which last year moved its HQ – and so its tax residency – to the Hague as part of its £130bn restructuring. One tax expert said: “It could be worth hundreds of millions.”
Under the changes, contained in the Budget, Gordon Brown is to tax companies that became non-resident for tax before April 2002 under “Controlled Foreign Companies and Residence” rules.
Shell carried out its restructuring in Britain by “reversing” into another UK company which had been registered before 2002. The company has always described the fiscal effect of its merger as “tax neutral”.
Jeroen van der Veer, Shell's chief, said Shell was studying the measure after receiving “an email from my tax people” on Wednesday.
He added: ” Our tax people have studied this and they have realised that our tax residency is in the Netherlands – that is where the headquarters is. But I am not a taxation expert.”
In an interview with The Daily Telegraph, Mr Van der Veer also said that Britain should not worry that more of its gas will come from Russian companies, such as state controlled Gazprom, as North Sea supplies run out.
Politicians had become alarmed after Russia cut off gas supplies to Ukraine this winter over a dispute about prices, he said.
However, he blamed that problem dating from the 1990s about “a lot of friction between Russia and Ukraine about the conditions of the gas delivery and whether they had paid for their gas”.
“It had nothing to do with them not liking to supply western Europe. On the contrary. For the past 30 or 40 years Gazprom has never missed a contractual delivery.
“They are very proud of that, and they will bend over backwards to keep that record.
''There is a high contractual compliance in their thinking. The Russian administration realises that export of oil and gas is one of the key levers for their international prestige as well.
“And like every country they will use that lever. If you talk with the leadership of Gazprom they are reasonable people, they don't necessarily fit our stereotype we have in the West.”

This website and sisters,,,, and, are owned by John Donovan. There is also a Wikipedia segment.

Comments are closed.