Author: Azizur Rahman 23 November 2021
Rahman Ravelli wrote an article that examines current French thinking regarding the criminalisation of dividend arbitrage strategies.
The piece, entitled “Cum-Ex/Cum-Cum practices: towards a penalization of dividend arbitrage strategies?’’ was published by France’s Dalloz Actualité.
It explains that although France has not been as aggressive as Germany in tackling dividend arbitrage strategies, it is now looking to crack down on the practices.
Rahman Ravelli outline how such practices work and explains that Cum-Ex trading has not been technically possible in France since the abolition of the tax credit there in 2005. But they emphasise that it is possible for a non-French resident title owner to escape the withholding tax through Cum-Cum transactions.
The article, which was written with fellow lawyer Mathieu Valeteau, details the measures that are in place for France to combat dividend arbitrage. It considers the possible effect of the removal of the French tax administration’s exclusive right to file criminal complaints for tax fraud, which is known as the “Bercy Lock".
Rahman Ravelli conclude that market participants would be wise to assess their exposure to tax and criminal risks arising from any possible involvement in dividend arbitrage strategies. They offer advice for those who may become implicated in an investigation.
To read Rahman Ravelli's article visit Dalloz Actualité.
Aziz Rahman is Senior Partner at Rahman Ravelli and its founder. His ability to coordinate national, international and multi-agency defences has led to success in some of the most significant corporate crime cases of this century and top rankings in international legal guides. He is recognised worldwide as one of the most capable legal experts regarding top-level, high-value commercial and financial disputes.