Shell considers relocating its headquarters to the UK
- Shell considers relocating its headquarters to the UK
July 4, 2020.
Royal Dutch Shell has consistently pushed for the Dutch Government to stop taxes on dividends. Oil and gas giant, the Royal Dutch Shell, is considering moving its corporate headquarters from The Netherlands to Britain. This could be a move against the implementation of dividend tax in The Netherlands.
The move was disclosed by the oil company’s Chief Executive Officer, Ben Van Beurden, during an interview with a Dutch newspaper on Saturday, July 4, 2020. According to him, the oil giant is not ruling out relocating its headquarters from the Netherlands to Britain. He said:You always need to keep thinking. Nothing is permanent and of course we will look at the business climate. But moving your headquarters is not a trivial measure. You cannot think too lightly about that.”
Further confirming the Chief Executive Officer’s comment, a Shell spokesman told Reuters that the oil giant is looking at ways to simplify its dual structure, as it had been doing for many years.
Royal Dutch Shell has consistently pushed for the Dutch Government to stop the tax on dividend paid to shareholders, as this makes financing dividend, share buy-backs and acquisition a lot more difficult. An earlier attempt by the Dutch Government to stop the dividend tax as an incentive to convince Unilever to unify its dual structure in Rotterdam, was met with an outcry by the public, who see that as a gift to rich foreigners.
It can be recalled that Shell had announced a few days ago that it might likely write down between $15 billion-$22 billion in post impairment charges for the second quarter of 2020. The impairment, which is its largest since the merger with Shell Transport and Trading Company Ltd in 2005, shows the huge adverse impact that the coronavirus pandemic has had on the oil giant’s businesses.
Also, in a move that shocked investors, Shell for the first time since the Second World War, cut down the dividend that it paid to its shareholders by two-thirds due to the negative impact of the pandemic. The decision came as a surprise to many including shareholders of the oil company which is by far the biggest payer of dividend in the FTSE 100. Shell has a complex Anglo-Dutch holding structure with a tax residency and headquarters in the Netherlands and a registered office in Britain.
Unilever’s decision to move followed the scrapping in 2018 of a plan by Dutch Prime Minister Mark Rutte to do away with a 15 percent dividend withholding tax.
Shell’s corporate structure features the parent company headquarters in The Hague but two share classes and other arrangements to prevent the Dutch government from levying withholding tax on dividends paid to shareholders of its former British arm.
The arrangement has come under renewed scrutiny after the Dutch government tried to scrap the dividend tax as an incentive to convince Unilever to unify its dual structure in Rotterdam.
Rutte abandoned the plan after a popular outcry over the tax cut, which was seen as a gift to rich foreigners.
Shell has consistently lobbied against the dividend tax, which it says makes financing dividends, share buy-backs and acquisitions more difficult.