French oil giant, Total Sa said its mention in the Paradise Papers reports does not mean the company had committed any wrongdoing while denying any direct involvement in keeping funds in tax havens.
In a statement released in French, the company said:
Total’s establishment of its subsidiaries is not dictated by tax incentives.
It meets operational objectives. In particular, it may be justified by the need to keep dollar accounts in order to avoid currency risks, due to the Group’s activity, which is not permitted under French corporate law.
The Group made a public commitment in 2012 not to create subsidiaries in countries considered as “tax havens” and to leave them for existing subsidiaries whenever possible.
In order to allow everyone to verify the fulfillment of this commitment, and for the sake of transparency, since 2015, Total has published in its reference document the exhaustive list of its consolidated subsidiaries with their country of incorporation and their country of activity.
Of the thirty or so subsidiaries concerned in 2012, 13 remained at the end of 2016, knowing that Total is not decision-maker for 10 of them.
Since 2015, Total has also published an annual report on the payments of all its extractive sector subsidiaries to the governments in which it operates.
In line with its transparency policy, Total says it has received journalists from the investigative consortium to answer all their questions. In this respect, Total wishes to re-establish certain facts and to correct certain untruths about the Group’s subsidiaries mentioned in their surveys:
Total confirms that it has held its investments in industrial projects for the production and transport of Dolphin gas and liquefied natural gas Qatargas, in Qatar and the United Arab Emirates, via companies registered in Bermuda.
The Group has never hidden the existence of these subsidiaries.
The use of these companies did not allow any tax optimization.
They were set up under non-French legislation to avoid currency risk through the keeping of dollar accounts, while having exactly the same taxation as if these investments had been made via a French company.
From their creation in 2002 until the end of 2010, these companies have been subject to French tax rules and corporate tax in France through the Consolidated Profit regime.
Even after the cancellation of this plan in 2011, Total did not obtain any tax benefit because of the establishment of these companies in Bermuda in relation to companies incorporated under French law.
These companies were transferred to France in 2015 as part of the commitment made in 2012 and recalled above.
The Paradise Papers is a leak about how a Bermuda-based law firm, Appleby aided the rich and mighty to hide their wealth in the British territory in order to pay less tax.