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Rahman Ravelli assess the French response to tax fraud as Cum-Ex investigations progress

Author: Azizur Rahman  9 November 2021

Posted in : Cum-Ex Media Coverage.

With investigations into Cum-Ex developing across Europe, Rahman Ravelli wrote about France’s approach to tax fraud.

In an article published by LexisNexis called “Cum-Ex / CumCum : Optimisation fiscale rime-t-elle avec fraude fiscale?’’ (“Does Cum-Ex and CumCum tax optimisation rhyme with tax evasion?’’), Rahman Ravelli examine the fine line between what can be considered tax optimisation and what would be deemed criminal tax evasion.

Rahman Ravelli explain the French way of tackling tax fraud. They refer to the implications of the removal of the French tax administration’s exclusive right to file criminal complaints for such fraud (the so-called "Bercy Lock"). 

The piece emphasises that although no criminal complaint from the French tax administration has been registered so far, an audit carried out by the French administration into Cum-Ex would be likely to lead to mandatory reporting to the French public prosecutor.

Rahman Ravelli consider whether the French criminal courts may be tempted to draw inspiration from the solutions adopted by their European counterparts. They highlight the significance of the decision of the German Federal Court on 28 July 2021, which confirmed that Cum-Ex transactions amount to criminal tax fraud, as they have no other economic motive than to obtain a refund of the withholding tax.

The article, which was co-authored with fellow solicitor Mathieu Valeteau of Baker and McKenzie, makes it clear that any French investigations regarding Cum-Ex (and / or related CumCum trades) will not be limited to those financial institutions directly involved in such arrangements. Intermediaries such as tax advisors and law firms that were involved in the development and implementation of such practices may also come under investigation.

Rahman Ravelli's article featured in the French Revue de Droit Fiscal.

Azizur Rahman C 09369

Azizur Rahman

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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.

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