Frankfurt/Main (dpa/lnw) – According to a ruling, the state-owned WestLB successor company Portigon is liable for billions in tax debts from previous cum-ex transactions. On Wednesday, the Frankfurt Higher Regional Court dismissed Portigon’s lawsuit, which wanted to shift the debt to another WestLB successor. The parties are in dispute as to whether WestLB’s tax liabilities were taken over by the first liquidation institution (“Bad Bank”) as part of a restructuring.
Portigon is owned by the state of North Rhine-Westphalia, while the two NRW savings bank associations each hold 25 percent and the state of North Rhine-Westphalia around 48 percent. Portigon could now have to pay for cum-ex tax debts of around one billion euros. The verdict is not yet legally binding. Appeals are possible at the Federal Court of Justice, as the OLG announced.
Landesbank WestLB got into trouble during the 2008/2009 financial crisis and was broken up in 2012 under pressure from the EU Commission. The bad bank, to which portfolio shares had already been transferred in 2009, took over further risk positions as well as strategically non-essential business areas during the restructuring that was completed in 2012. The parties dispute whether the tax liabilities for the cum-ex transactions carried out by the plaintiff before the restructuring were also taken over when the “capital market business” division was transferred. That wasn’t exactly stipulated in the contract.
WestLB was reportedly involved in cum-ex deals between 2005 and 2008. The share deals around the dividend date were aimed at having capital gains taxes reimbursed by the tax authorities several times, which were not paid. Numerous German banks are involved in the tax scandal.
In 2016, the tax office and the public prosecutor’s office initiated investigations into the cum-ex deals. Ultimately, with the notices of 2019 and 2020, the tax office claimed back capital gains tax and the solidarity surcharge as well as interest for the years 2005 to 2008 of around one billion euros. The district court in Frankfurt had ordered the first liquidation agency to take over the tax debts. Your appeal was now successful before the OLG Frankfurt. The institution said on Wednesday that it felt its legal opinion was confirmed by the verdict.
