The Nichicon Group (hereinafter, the “Group”) complies with the tax-related laws, regulations and systems of various countries and regions. We also recognize the intent of tax frameworks publicized by the Organization for Economic Co-operation and Development (OECD) and other international institutions, and conduct appropriate tax management.
As a corporate citizen, the Group recognizes that appropriate tax practices are an important social responsibility for a company. Accordingly, we promote tax compliance, thereby contributing to the economies and societies of the countries and regions where we operate and striving to maximize shareholder value.
1. Tax-Related Risk Management and Governance Structures
The Company's director in charge of finance and accounting takes groupwide responsibility for the Group's tax risk management, identification of tax reform trends in various countries and regions, and general tax control management. Under his supervision, the Company's accounting department creates systems for tax-related reporting and management at Group companies and keeps all parties informed. In the event of uncertainty with respect to the application and interpretation of laws and regulations or of tax issues related to business activities, the Group responds appropriately after obtaining the advice and support of third-party specialists.
2. The Group's Stance on Tax Planning
The Group engages in transactions for legitimate business purposes and in light of tax circumstances and does not conduct tax planning or tax avoidance that deviates from the purport of tax legislation. The Group makes effective use of tax incentives offered by various countries and regions within the normal scope of business. However, the Group does not engage in excessive tax reductions that are out of line with economic circumstances.
3. Transfer Pricing Initiatives
In international transactions between Group companies, the Group complies with OECD transfer pricing guidelines and, after analyzing various functions, assets and risks, the Group determines the appropriate distribution of profits in line with each company's contribution and based on the arm's-length principle. On transactions involving transfer pricing risk, the Group gives ample prior consideration and, when necessary, receives advice and guidance from third-party specialists.
4. Relations with Tax Authorities
The Group responds to requests from tax authorities by earnestly providing appropriate information in a timely manner. In this way, the Group strives to maintain trust-based relations with national and regional tax authorities. In addition, when necessary the Group enters into agreements with tax authorities under prior confirmation and other systems in an effort to clarify its long-term tax position and reduce uncertainty.