Portugal vs A Mining SA: JUDGMENT
Case Information
- Court: Supreme Administrative Court, Portugal
- Case No: 0120/12.9BEBJA 01224/16
- Applicant: A…, S.A.
- Defendant: AT – Tax and Customs Authority
- Judgment Date: 10 February 2024
The case concerns a tax disputeTax Disputes arise when there is a disagreement between taxpayers and tax authorities regarding the interpretation or application of tax laws. These disputes may concern various issues such as the accuracy of a tax return, the eligibility for tax deductions or credits, the correct amount of tax liability, or transfer pricing adjustments. Tax disputes can lead to lengthy legal proceedings... between A…, S.A., a Portuguese mining company, and AT – Tax and Customs Authority. At the heart of the issue was the sale of an industrial wash plant by A… to B…, S.A., at a symbolic price of €1. AT contended that the sale breached transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... principles under Article 58 of the IRC Code. It argued that a special relationship existed between the parties at the time of negotiating the transaction, which enabled a non-arm’s length price to be set, resulting in an under-reported tax liabilityTax liability represents the total amount of tax owed by an individual or business to a tax authority, whether local, national, or international. This obligation arises through various forms of income, profits, or transactions subject to taxation laws and regulations. Understanding tax liability is essential for compliance and efficient financial management for corporations and individuals. It influences how businesses structure....