PRESS REPORTS RELATING TO FISCAL ASPECTS OF THE OLIVETTI-TELECOM MERGER (2003), BLU’S MERGER INTO TIM (2002) AND ALLEGED V.A.T. EVASION BY TELECOM ITALIA SPARKLE
TELECOM: THE COMPANY ACTED WITH THE UTMOST PROPRIETY AND IN FULL RESPECT OF THE LAWS IN FORCE
With regard to an article published today by weekly magazine “L’Espresso” entitled “Telecom, la maxi evasione” (“Telecom, the maxi evasion”), Telecom Italia firmly states that it acted with the utmost propriety and in full respect of the existing laws.
During a routine inspection, the Guardia di Finanza (fiscal authorities) made observations concerning the fiscal treatment of the devaluation of Telecom Italia shares held by the incorporating company Olivetti (prior to the Olivetti-Telecom merger). In particular, positing the existence, or not, of possible tax evasion. While noting in the first place that these observations will form the basis of a deeper examination by the fiscal offices that deal with verification and which will decide whether to formally contest past behaviour, Telecom Italia states that these observations are groundless. The operation carried out in full transparency, as announced to shareholders and the market at the time, and in full respect of statutory and fiscal rules law, as well as the practices of the Fiscal Agency.
The Company, backed at the time by professional advice of the highest level, is confident that its interpretation of the law was correct and that the proof it will submit to the Financial Administration will definitively resolve the issue.
About one year ago, Telecom Italia also received from the Tax Agency a simple statement (and not a tax audit), formalizing a claim relative to the operation of concentration carried out by Tim with the incorporation of Blu in 2002.
This operation was pre-emptively submitted to the Tax Agency for examination. Following this request the Agency considered the operation fiscally correct, consequently on the basis of trust and good faith the Company proceeded with its action.
The Company, in the event of a tax audit, will proceed via the relevant judicial avenues to obtain the annulment of the eventual notifications.
With regard to the alleged V.A.T. evasions by Telecom Italia Sparkle, Telecom Italia states that no procedure has been launched against the Company.
Milan, 9 November 2007