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Jonathan Addo
Jonathan Addo
  • Jonathan Addo

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  • British Virgin Islands
Jeremy Child
Jeremy Child
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Stuart Cullen
Stuart Cullen
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Julie Engwirda
Julie Engwirda
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Peter Ferrer
Peter Ferrer
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Claire Goldstein
Claire Goldstein
  • Claire Goldstein

  • Partner
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Hazel-Ann Hannaway
Hazel-Ann Hannaway
  • Hazel-Ann Hannaway

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Nick Hoffman
Nick Hoffman
  • Nick Hoffman

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Andrew Johnstone
Andrew Johnstone
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Paula Kay
Paula Kay
  • Paula Kay

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Phillip Kite
Phillip Kite
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Vicky Lord
Vicky Lord
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Paul Madden
Paul Madden
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Henry Mander
Henry Mander
  • Henry Mander

  • Partner
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Ian Mann
Ian Mann
  • Ian Mann

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William Peake
William Peake
  • William Peake

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Lorinda Peasland
Lorinda Peasland
  • Lorinda Peasland

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Chai Ridgers
Chai Ridgers
  • Chai Ridgers

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Nicola Roberts
Nicola Roberts
  • Nicola Roberts

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  • Singapore
Paul Smith
Paul Smith
  • Paul Smith

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Andrew Thorp
Andrew Thorp
  • Andrew Thorp

  • Partner
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Jessica Williams
Jessica Williams
  • Jessica Williams

  • Partner
  • Cayman Islands
Jayson Wood
Jayson Wood
  • Jayson Wood

  • Partner
  • Cayman Islands

With and (then) without: “cum-ex” trading scandal dismissed by English Commerical Court in landmark case for lack of jurisdiction

Mr Justice Baker has handed down judgment in Skatteforvaltningen (the Danish Customs and Tax Administration) v Solo Capital Partners LLP (in special administration) and many others, dismissing the "massive" and "unprecedented" claim at the first opportunity. 

As part of the Kingdom of Denmark’s ongoing investigation into the “cum-ex” dividend tax fraud, the Danish Customs and Tax Administration, Skatteforvaltningen (SKAT), had commenced proceedings in the English High Court in connection with a number of tax refund claims that SKAT asserted had been improperly submitted and which it, in turn, had in error approved and paid. The proceedings listed over 100 defendants, sought relief of £1.5 billion and had been listed for a final trial in January 2023 which was expected to last over a year until March 2024.

However, Mr Justice Baker has dismissed the case in its entirety in its first substantive hearing, finding that SKAT’s claim is inadmissible under Dicey Rule 3. The rule states that “English courts have no jurisdiction to entertain an action: (1) for the enforcement, either directly or indirectly of a penal, revenue or other public law of a foreign State; or (2) founded upon an act of state (Dicey, Morris & Collins on the Conflict of Laws, 15th Ed., R5-019)”.

While SKAT had sought to frame its case as advancing private law causes of action, Mr Justice Baker found that the claims were in substance seeking to recover dividend tax which SKAT asserted it was entitled to for the period in question. The court was therefore being asked to enforce the sovereign tax rights of the Kingdom of Denmark. Such matters fell within the scope of Dicey Rule 3 and therefore outside of the English court’s jurisdiction.

The English proceedings were just one of the steps SKAT is pursuing in its investigation into the “cum-ex” fraud, which it claims has defrauded the Kingdom of Denmark of over DKr 12.7 billion. Germany, Italy and France are among the other European counties which are understood to have lost tax revenue stretching into the billions from the fraud.

If you have any queries or require assistance with SKAT-related proceedings please contact Jonathan Addo in the BVI or Nick Hoffman in the Cayman Islands.

With and (then) without: “cum-ex” trading scandal dismissed by English Commerical Court in landmark case for lack of jurisdiction