Campari’s controlling family faces €1.29 billion tax seizure
Italian tax authorities have seized Campari shares worth €1.29 billion from its Luxembourg-based holding company, Lagfin, amid allegations of tax fraud. The Garavoglia family, which controls the group, rejects any wrongdoing.
The Italian authorities allege that the holding company, Lagfin, which is controlled by the Garavoglia family, committed tax fraud. The value of the shares seized equates to the tax in question. They will be held until the case is resolved.
Lagfin controls 51.3% of the shares in Campari and 38.8% of the voting rights of Davide Campari Milano NV, which is now registered in the Netherlands.
The drinks group moved its formal registration to Amsterdam in 2020 to benefit from advantageous tax laws and to exercise tighter control of the company through Dutch company law.
Response from Lagfin and Campari
Lagfin rejects the allegations. When the case was first announced last year, it said it would defend itself against the charges “vigorously and serenely in all competent forums”.
Campari said it was not involved in the case and neither were any of its subsidiaries.
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Details of the investigation
The alleged offence is of “fraudulent declaration by means of artifice” and for “administrative liability of legal persons” between 2018 and 2020.
The investigation began a year ago following the merger of holdings in Campari.
Those indicted as legal representatives of Lagfin are Luca Garavoglia, head of the family group and the company chairman, and Giovanni Berto, who leads the Italian branch of Campari.
Disputed exit tax
Investigators say that the Garavoglia family did not pay the exit tax resulting from the cross-border merger between Alicros, the previous holding company of the group, which was based in Italy and Lagfin, which is legally domiciled in Luxembourg.
They say they have found that the exit tax capital gains of more than €5.3 billion, accrued by the Italian company when it was sold to the Luxembourg company, had not been declared at the time of the merger.
They also maintain that the merger was not a management necessity but a ploy to take the assets abroad.
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