Huge Vivendi tax break
p2pnet.net News:- Proving that there’s more than one way to skin a cat, the owner UMG, one of the world’s largest record company, has struck a bargain with the French authorities under which it’ll be able to boost its 2004 earnings by about $600 million.
Under a new system, Vivendi Universal SA, “will be able to offset earlier losses against tax on the profit made by its successful 56 percent-owned SFR-Cegetel telecommunications unit,” says an Associated Press story here, going on:
“By offsetting euro11 billion (US$13.3 billion) in losses posted between 2000 and 2003, Vivendi will be able to save around euro3.8 billion (US$4.6 billion) in the next five to seven years.”
Or as Vivendi puts it: ”Following the application made on December 23, 2003, Vivendi Universal has been authorized by the French Ministry for the Economy, Finance and Industry to file under the Consolidated Global Profits tax system pursuant to Article 209 quinquies of the General Tax Code.”
Vivendi, whose UMG is one of the Big Four record label cartel companies, staggered back from bankruptcy after ex-chairman Jean-Marie Messier’s spending excesses brought it close to ruin.
At one point, French prosecutors were examining whether or not Vivendi deliberately misled investors while it was being run by Messier, who himself faced possible class-actions in the US. It was also under criminal investigation in the US.
“As part of the change in tax status, Vivendi agreed to help create jobs in French regions plagued with high levels of unemployment, the Ministry of the Economy, Finance and Industry said in a separate statement,” says Bloomberg News here.
