The oil company, which wants to simplify its structure to pay larger dividends, follows the example of the unilever consumer product giant.
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“Uncomfortably surprised” and, above all, very disappointed: the resignation government of the Netherlands lamented “at the highest point” Royal Dutch Shell’s decision to move its headquarters and its tax location from the Hague to London. The announcement, made on Monday, November 15th in the morning, is accompanied by what the Dutch assimilate at a booth shot: the oil and gas giant will officially become shell plc, renouncing the “Royal” and “Dutch” qualifiers (“Dutch” ) The Director General and the Chief Financial Officer will also move to the British capital.
The company explains above all its gesture by a desire to simplify its organization, in order to better redistribute its profits to shareholders. Shell will have only one class of shares, while currently there “Class A” and “Class B”. “[This] will organize more share buybacks,” says direction.
The obligation, for Shell, to submit to the constraints of the energy transition and to reach the carbon neutrality is another reason for this transfer. Wednesday, May 26, the Hague District Court had forced the group to reduce its emissions more quickly than expected. Environmental organizations and some 17,000 citizens had gained trial forcing the company to reduce its emissions by 45% by 2030, in order to comply with the 2015 Climate Paris Agreement.
Taxation projects
Shell appealed but is supposed, waiting for this judgment, comply with the judgment taken at first instance. The management ensures that its move does not change the trial and the current call. The association Friends of the Earth, one of the plaintiffs, abounds in the same direction. “The prosecution remains in front of the Dutch courts,” says Peer de Rijk, a complaint coordinator.
The move to London is also linked to tax issues and taxation of dividends. In 2018, public opinion had been struck by the fact that Shell had not paid taxes as his profit had risen to 1.3 billion euros the previous year. In the wake, the Government of Liberal Mark Rutte tried to correct the image of a fourth fourth kingdom in the world ranking of tax havens for large companies, according to data from the international network for tax justice.
It therefore introduced a project to tax the benefits of groups escaping the tax, even if their headquarters is established in the Kingdom. Shell could therefore cumulate the losses of his subsidiaries and deduct them – just like his investments abroad – of his profits in the Netherlands. Its taxes had therefore been reduced almost nil over the last decade. Mr. Rutte had previously defended a 15% tax abolition project on dividends paid to shareholders, which would have allowed Shell to save 7 billion euros.
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