In brief
Netflix's offices in Paris and Amsterdam were raided by French and Dutch officials in a tax fraud investigation linked to the company's operations in Europe. The probe, which began in 2022, focuses on allegations of serious tax evasion and off-the-books work.
In an unexpected dawn raid on Tuesday, investigators from France and the Netherlands targeted the offices of Netflix in Paris and Amsterdam as part of an ongoing investigation into tax fraud. French judicial sources indicate that authorities in both countries have been collaborating since the case was initiated in November 2022.While the streaming giant has yet to release a substantive statement regarding the raids, Netflix maintains that it adheres to tax regulations across all its operating territories. Notably, the Amsterdam office functions as the headquarters for Netflix's operations within Europe, the Middle East, and Africa.The French investigation is being led by the National Financial Prosecutor's office (PNF), which specializes in complex financial crimes. Authorities are reportedly investigating allegations tied to "covering up serious tax fraud and off-the-books work." Investigations extend to tax filings for the years 2019, 2020, and 2021.Reports from French media outlet La Lettre suggest that Netflix historically minimized its tax liabilities in France by declaring revenue as generated in the Netherlands until 2021. Following a cessation of this practice, Netflix's declared turnover in France rose significantly from €47.1 million ($51.3 million; £39.6 million) in 2020 to €1.2 billion in 2021. Investigators are now scrutinizing whether Netflix continued to seek ways to lower its profit margins beyond the year 2021. Having entered the French market over a decade ago and establishing its Paris office in 2020, Netflix boasts approximately 10 million subscribers in France, according to AFP news agency. The company's financial strategies are under increased scrutiny as authorities aim to ensure compliance with tax laws in an increasingly complex digital marketplace.
