Paris, France – French and Dutch authorities conducted raids on Netflix offices in Paris and Amsterdam as part of a collaborative investigation into alleged tax fraud, according to French judicial sources. The investigation, which began in November 2022, focuses on potential tax evasion and unreported earnings by the global streaming giant.

Netflix, headquartered in Los Gatos, California, has yet to comment on the raids directly, but the company reiterated its commitment to adhering to tax laws in every region it operates. The office in Amsterdam, Netflix’s European headquarters, oversees operations across Europe, the Middle East, and Africa.

The investigation in France is being led by the National Financial Prosecutor’s Office (PNF), a specialized unit responsible for handling high-profile financial crimes. Officials from the PNF are reportedly scrutinizing Netflix for allegedly “covering up serious tax fraud and off-the-books work.” The inquiry includes examining Netflix’s tax filings for 2019, 2020, and 2021, years during which the company is suspected of minimizing reported profits to reduce its tax burden in France.

Authorities in the Netherlands conducted simultaneous searches at Netflix’s Amsterdam office, working closely with French investigators. Officials from both countries have been coordinating efforts for months, according to French judicial sources.

The investigation was initially prompted by concerns that Netflix may have shifted revenue from France to the Netherlands, allowing it to benefit from more favorable tax arrangements. French media outlet La Lettre reported last year that until 2021, Netflix declared its French-generated revenue in the Netherlands, effectively lowering its tax payments in France. After changing this practice, Netflix reported a sharp increase in revenue in France, jumping from €47.1 million ($51.3 million) in 2020 to €1.2 billion in 2021.

However, the authorities are now investigating whether Netflix continued efforts to limit reported profits after 2021. If confirmed, such actions could indicate an ongoing strategy to minimize tax obligations.

Netflix launched its streaming service in France over a decade ago, opening a dedicated Paris office in 2020. Since then, the company has garnered around 10 million subscribers in the country, according to AFP news agency, making it one of the largest streaming platforms in the region.

The outcome of the investigation could have significant implications, as European governments have been increasing pressure on tech giants to ensure fair tax practices. The European Union has previously taken steps to address tax loopholes and boost transparency, particularly concerning companies with multinational operations that generate significant revenue from European consumers.

This investigation marks one of the latest moves by European authorities to address concerns about tax evasion by large technology firms. Depending on the findings, Netflix may face financial penalties or be required to alter its financial reporting practices in the region. The developments also come amid a broader push by European governments to standardize corporate taxation and prevent revenue shifting across borders.

Estonia has become a top destination for entrepreneurs and digital nomads, thanks to its advanced digital infrastructure and business-friendly regulations. Setting up a business in Estonia is efficient and flexible, with options to suit various needs, from e-residency to traditional registration methods. This guide will walk you through the main pathways to register a company in Estonia, highlighting the steps, benefits, and considerations for each.

1. E-Residency Program: A Digital Pathway to Business

Estonia’s e-residency program is revolutionary, enabling foreign entrepreneurs to set up and manage a fully digital company within Estonia’s legal framework. After applying for e-residency and obtaining a digital ID, you gain access to Estonian government portals and digital business services. This pathway is popular among remote workers, freelancers, and startups, as it allows complete management of the business online without physical presence.

• Pros: No physical presence required, full access to Estonia’s digital ecosystem, and easy integration with EU banking systems.
• Cons: Limited to certain business models and requires understanding of online compliance.

2. Traditional On-Site Registration

For those who prefer or require a more traditional approach, on-site company registration in Estonia provides a straightforward process. This method is often chosen by entrepreneurs who plan to live in Estonia or have a local representative. The process involves filing the necessary documents with Estonia’s Commercial Register and can be completed in a few days if all paperwork is in order.

• Pros: Suitable for businesses requiring a physical presence, can access additional support services within Estonia.
• Cons: Requires in-person visits to Estonia or use of local representation.

3. Company Registration via Power of Attorney

For those who cannot be physically present in Estonia, company registration via a power of attorney is an efficient and secure solution. By granting a trusted representative or legal expert the authority to handle the registration process on your behalf, you can establish your business remotely. This method is particularly useful for international entrepreneurs who prefer expert assistance in navigating legal and administrative procedures.

• Pros: Complete registration without traveling to Estonia, saves time and simplifies the process.
• Cons: Requires choosing a reliable representative, and additional legal fees may apply.

Why Choose Eesti Firma for Company Registration?

Eesti Firma specializes in guiding clients through each step of the Estonian company registration process. Our expertise includes assistance with e-residency applications, on-site registrations, and registrations via power of attorney. With tailored support, local knowledge, and a focus on efficient service, we ensure that your path to establishing a business in Estonia is smooth and fully compliant. Let Eesti Firma help you set up an enterprise in Estonia and unlock the potential of the EU’s digital gateway.

In response to Chancellor Rachel Reeves’ recent announcement of a 1p cut in draught beer duty, Kyle Hamilton, manager of the Flying Duck pub in Ilkley, is giving away a penny with every pint sold. Hamilton set up an honesty box at the bar for patrons to take a penny after each purchase, although he expressed skepticism that the duty cut would significantly impact drink prices.

The duty reduction was unveiled during Reeves’ budget announcement on Wednesday, part of a broader strategy to stabilize public finances. However, Hamilton criticized the move as “nominal,” suggesting it would not translate into noticeable savings for consumers.

“I don’t think consumers are necessarily going to see that penny directly,” Hamilton said. “But we are putting an honesty box at the bar where people can help themselves to a penny after every pint they buy. They can feel it that way, but on a large scale, it’s a very nominal effect.”

In discussing the budget, Hamilton noted that other measures, such as an increase in employers’ National Insurance contributions and a rise in the minimum wage, would have a more substantial effect on small businesses like his own. “A lot of pubs are struggling as it is,” he remarked, pointing to changing drinking habits and the ongoing cost-of-living crisis as significant challenges.

To keep the Flying Duck afloat, Hamilton is employing various strategies, including brewing beer on-site and hosting live music and quiz nights. Despite the financial challenges, the pub is committed to community support. Their upcoming beer festival from November 8-10 will not raise funds for the pub itself but will benefit local children’s football teams. The event will feature free brewery tours, live music, and rock ‘n’ roll bingo throughout the weekend.

The budget changes also include an increase in the National Insurance rate that employers pay, rising from 13.8% to 15% on earnings above £175 starting in April. Additionally, the threshold for employers to start paying the tax will decrease from £9,100 to £5,000 annually. Despite these increases, Chancellor Reeves announced an extension of the Employers Allowance, allowing businesses to claim back more from their National Insurance bill, raising it from £5,000 to £10,500.

The expected rise in National Insurance contributions is anticipated to generate £24 billion, accounting for over half of the total tax increases outlined in the budget. As pubs like the Flying Duck navigate these changes, Hamilton’s penny offer reflects both a playful gesture and the tough reality many in the hospitality sector face.