The Board of Directors of Play Communications S.A. (the “Company”) hereby reports that according to the information submitted by proxy of P4 sp. z o.o. (“P4”, a wholly owned subsidiary of the Company), Head of Tax and Customs office in Warsaw (the “Tax Authority”) has delivered to P4 on July 25, 2019 a decision issued on July 23, 2019 (the “Decision”) determining tax liability of P4 with regard to Corporate Income Tax for the year 2013.
The Decision is not final and therefore it is not subject to execution. In the Decision, the Tax Authority has declared that license fees related to use of trademarks applied by P4 were not priced at market value. Therefore, the Tax Authority challenged P4’s right to include expenses related to the use of trademark in the tax-deductible costs. P4 will appeal against the Decision. According to P4, the amount of license fees incurred was set at the market level.
The Decision assesses tax liability of P4 at PLN 12 million. However, the Decision should not result in an obligation to pay any due tax since in its tax return for CIT 2013, P4 did not utilize the whole amount of available tax loss from previous reporting periods. The available tax loss covers the whole tax liability assessed in the Decision.
Art 17 of MAR