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Salomé Lemasson assesses the French response to tax fraud as Cum-Ex investigations progress

Author: Salomé Lemasson  9 November 2021

With investigations into Cum-Ex developing across Europe, Rahman Ravelli’s Salomé Lemasson 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?’’), Salomé examines the fine line between what can be considered tax optimisation and what would be deemed criminal tax evasion.

Salomé explains the French way of tackling tax fraud. She refers 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"). 

Her 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.

Salomé considers whether the French criminal courts may be tempted to draw inspiration from the solutions adopted by their European counterparts. She highlights 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.

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

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Salomé Lemasson

Of Counsel Head of EU Business Crime and Regulatory Practice Group

salome.lemasson@rahmanravelli.co.uk
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Salomé works on Europe’s most challenging and significant white-collar and complex crime cross-border cases. She leads Rahman Ravelli’s EU Business Crime and Regulatory Practice Group, representing and advising companies and individuals in high-stakes investigations.

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