Chiquita Group Tax Policy
Chiquita is a responsible corporate citizen and acknowledges its responsibility to pay taxes, as well as comply with all the laws and rules in force, in all countries where it does business.
Taxes for multinational companies are complex in nature. However, a fundamental principle recognized around the world is that a company’s profits should be taxed where value is created. Chiquita follows this principle. We are responsible to the communities in which we live and work, and contributors to national and local economies in the form of taxes, duties, levies and charitable contributions. Chiquita also pays taxes that are collected on sales of products and services.
Commitment to compliance
A core principle of Chiquita’s policy is to practice transparency and to build trust. We seek a healthy working relationship with all tax authorities. We aim to ensure that tax returns are filed and tax is paid on a timely basis in each jurisdiction in accordance with local and international governing laws and rules. We are regularly audited by the tax authorities. We take this as an opportunity to certify our practices.
The volume of product and service flows among entities within Chiquita’s supply chain is significant. Chiquita’s policy for the pricing of such transactions is based on a full functional analysis of the value-drivers for our business, making sure that all entities are remunerated at “arm’s length” in accordance with Organization for Economic Co-operation and Development (OECD) and all country-specific rules.
Involvement in the business
The Chiquita Tax Department is involved in all relevant aspects of our business, partnering closely with management to provide guidance to ensure efficient and compliant operations. The Tax Department is responsible for implementing the Group’s tax policy.
Attitude to tax planning
Chiquita does not engage in the artificial creation of structures or artificial financial arrangements that are unrelated to real business transactions and are primarily created to reduce the tax liabilities of the group. Chiquita does not lobby or pressure host governments to provide it with more favorable tax treatment.
Transparency and simplification
Chiquita welcomes the initiative of Country-by-Country Reporting, the BEPS initiative, a Common Consolidated Tax Basis for the European Union, a standardized VAT return for the European Union, and everything that implies the standardization, simplification and transparency of tax practices.
Attitude to tax risk and how it is managed
A multinational business such as Chiquita’s is exposed to a variety of tax risks, mostly derived from the complexity in compliance, the continual changes of tax rules, subjectivity and conflicts of law between different jurisdictions.
Chiquita’s management understands the importance of managing such risks and has put in place systems to manage them. This includes ensuring that the group has a suitably staffed and trained tax team and making sure that the tax team is involved in the daily life of the company, in all material transactions and in the statutory audits that the different companies of the group are subject to.
Chiquita’s Group Tax department is made up of a team of tax professionals strategically based within the organization. Internal controls and escalation procedures have been put in place with the aim of identifying, quantifying and managing key risks (including full compliance with IAS12 for the group and ASC740 and 450 for the US sub-group).
Chiquita’s tax team has frequent meetings with management and keeps management updated on all tax risks identified. Chiquita uses automated systems in order to help keep tax risk to a minimum, such as a fully automated transactional tax tool for sales-tax/VAT and corporate income tax compliance software where it is deemed appropriate.
Chiquita regards the publication of this tax strategy as complying with the duty under Schedule 19 of the Finance Act 2016 to publish the group tax strategy in the current financial year.