Tax fraud: McDonald's pays 1.25 billion euros to avoid prosecution in France
The fast food chain McDonald's (photo illustration).
REUTERS/Lucy Nicholson/File Photo
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French justice suspects the brand, in the crosshairs of the tax authorities since 2014, of having artificially reduced its profits in France from 2009 by means of royalties for the operation of the McDonald's brand paid to its European parent company based in Luxemburg.
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McDonald's has agreed to pay 1.25 billion euros in France to avoid criminal prosecution for tax evasion between 2009 and 2020, according to an agreement validated Thursday by the president of the Paris court, Stéphane Noël.
The judge validated the payment by McDonald's of a fine of public interest of 508 million euros, accepted by the fast food group.
The group had also approved in May the payment of 737 million euros to the tax authorities to settle its corporate tax, evaded by this scheme of tax evasion.
By agreeing to sign this legal agreement in the public interest (Cjip) concluded with the National Financial Prosecutor's Office (PNF), the most important in France to date in terms of tax evasion, the McDonald's group thus avoids a lawsuit in France and settles its dispute with both the tax authorities and the public prosecutor.
This “
led to absorbing a large part of the margins generated by French restaurants and to reducing the taxes paid in France by the various structures of the French group
”, notes the president of the judicial court.
A "
real penalty
"
The national financial prosecutor, Jean-François Bohnert, values the agreement concluded with McDonald's, explaining that the fine in the public interest had been set at the "
maximum amount that could be pronounced within the framework of a Cjip
".
The entire agreement represents "
2.5 times the amount of tax evaded
" by the group, 469 million euros.
For him, it is a "
real sanction, both symbolically and economically
".
This "
convention confirms the particular effectiveness of the Cjip, particularly in terms of corporate taxation, where the financial penalty is the most appropriate way to respond to transnational fraud
", he insists.
“
McDonald's did not hesitate to pay taxes in France, 2.2 billion over the entire period
”, underlines Me Eric Dezeuze, lawyer for the fast-food giant.
The criminal investigation had been opened following complaints from the Works Council of McDonald's Ouest Parisien and the CGT McDonald's Ile-de-France.
Employees could take civil action to obtain compensation for their damage.
A coalition of European and American unions and an association for the fight against British poverty hailed a "
snub
" for McDonald's and a "
victory
" for employees.
(with AFP)
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