The Court of Appel has for the main parts decided in favor of Telenor ASA in a
tax case concerning losses on settlement under guarantees for financing in the
Indian subsidiary Unitech Wireless. Telenor ASA deducted the loss in its tax
return for 2013.
On 5 June 2019, Telenor ASA received a decision from the Tax Office disallowing
the deduction. As a result of the decision, a tax expense of NOK 2,491 million
plus interest of NOK 166 million were recognized in the accounts and paid in
2019. Telenor ASA appealed the decision, and the Tax Appeal Board upheld the
ruling on 10 February 2021.
Telenor ASA appealed the ruling to Oslo District Court. In a ruling received 28
March 2022, the Oslo District Court ruled in favor of Telenor and allowed
deduction for the losses in 2013. As a result, the tax expense with NOK 2,491
million and interest expense with NOK 166 million were reversed in the accounts
for 2022.
The government appealed the ruling from the district court. In ruling of 9 June
2023, the Court of Appeal decided in favor of Telenor that the loss is
deductible, in accordance with the ruling from Oslo District Court, however so
that the timing for recognition of the loss is changed from 2013 to 2015. The
tax deduction will be slightly reduced due to the timing difference and
declining tax rates.
Both the Norwegian government and Telenor ASA have a right to appeal the ruling.
The authorities are not obliged to repay the resulting tax amount together with
interest before there is a final enforceable ruling from the courts.