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Thursday, 22 December 2016

Zain Iraq to pay USD 94 mn to settle Orascom Telecom-related tax dispute

Zain Iraq will pay USD 94 mn to settle a tax case related to the 2007 acquisition of rival operator Iraqna from Orascom Telecom, its Kuwaiti parent Zain said, according to Reuters. Iraq’s tax authority had claimed Zain Iraq owed USD 187 mn in capital gains tax due on its USD 1.2 bn purchase of Iraqna and “unusually, the government tried to levy the capital gains tax on Zain Iraq as the asset buyer, rather than on the seller, Egypt’s Orascom Telecom, which was later renamed Global Telecom.” The newswire notes that under the settlement Iraq’s tax authority “will drop its claims against Zain Iraq, cancel associated owed interest and penalties, and allow Zain Iraq to appeal against additional tax assessments on itself and Iraqna for the respective periods of 2004-2010 and 2004-2007.”

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