French and Dutch authorities raided streaming giant Netflix’s offices in Paris and Amsterdam Tuesday as part of a tax fraud probe, a judicial source told AFP.
The US company’s headquarters for Europe, the Middle East, and Africa is located in Amsterdam.
Tuesday’s search by specialist financial investigators relates to suspicions of “covering up serious tax fraud and off-the-books work” and is part of a probe opened in November 2022, the source said.
“French and Dutch authorities have been cooperating on this criminal case for many months,” they added.
Netflix is also being investigated in France for tax returns from 2019, 2020, and 2021.
When the probes became public last year, the corporation asserted that it follows tax laws in all countries where it operates.
According to French publication La Lettre A, Netflix’s French operation is organized until 2021 with all members signing up through a Dutch company.
This left it paying less than one million euros ($1.1 million at current rates) in taxes to Paris in 2019 and 2020.
Authorities are also investigating if Netflix continued to make illegal steps to reduce its reported income and hence its tax burden, according to La Lettre A.
According to the publication, the French subsidiary showed extremely poor operating margins when compared to the US mothership.
Netflix collected more than $9.8 billion in income from its 282 million users worldwide between July and September of this year, with a net profit of $2.4 billion.