Fashion
German multinational retailer Metro’s Vietnamese woes continue with a fine of almost US$3 million issued this week for tax evasion.
Metro has for months being trying to offload its trouble Metro Vietnam subsidiary, initially via a sale to Thai business Berlei Jucker which was foiled by a shareholder revolt. A new deal was reached with BJ’s founder Charoen Sirivadhanabhakdi through his TCC Group, but it is not clear the status of that agreement, with Vietnamese authorities impeding the cross border investment.
According to the English edition of the Tuoi Tre (Youth) newspaper in Vietnam, Metro first came under scrutiny over suspicions of transfer pricing back in 2012. Independent investigations cleared the company of wrongdoing. But the General Department of Taxation launched its own investigation and after two months concluded the company had “committed wrongdoings worth VND507 billion ($23.63 million) in a transfer pricing inspection that concluded Monday,” according to Tuoi Tre.
Metro Vietnam has been ordered to pay VND62.64 billion ($2.92 million) in tax arrears, a deputy minister of finance confirmed to Tuoi Tre.
Metro Vietnam opened in 2002, investing US$78 million in opening 19 stores in city centres. But it has reported a profit just once – of $5.41 million in 2010 – and last year decided to exit the market. In 2007 and 2008, it posted losses of $7.32 million and $8.85 million respectively.
