Mandatory opinion on cross-border reorganisations by tax authorities
Changes to the Commercial Companies Code and tax legislation are preparing to take place, which could have a huge impact on the process of planning and carrying out cross-border reorganisations this year. The amendment will introduce new types of cross-border operations, such as demergers and cross-border conversions.
Very significant changes are also planned in the tax area, as the performance of each cross-border reorganisation, i.e. cross-border merger, division and transformation, will require a positive opinion issued by the Head of the National Fiscal Administration (KAS).
The subject of the opinion will, in principle, be the assessment of the business justification of the reorganisation from the point of view of the general anti-avoidance clause (GAAR), measures limiting the granting of benefits on the grounds of double taxation treaties, and the possibility of considering the transaction as an abuse of rights within the meaning of the VAT Act.
In addition, the authority will verify whether the company’s monetary liabilities to tax authorities and non-tax budget receivables are satisfied or secured.
The Head of KAS will have to issue an opinion within one month, but in particularly justified cases, this deadline will be extendable by another three months.
The effect of the Head of KAS’s refusal to issue an opinion may be the refusal of the registry court to issue a certificate and, consequently, blocking the entire reorganisation process.
The bill envisages that the new provisions will enter into force from 1 August 2023.
The obligation to obtain an opinion will not apply to those reorganisations under which a plan of merger, division or transformation is filed with the registry court before the date of entry into force of the amending act (i.e. before 1 August 2023).