Ladbrokes owner GVC deals with probe by UK tax authority

21 July 2020

Ladbrokes owner GVC has stated it is "surprised" the UK's tax body is broadening a query into "possible corporate upseting" associated with its previous Turkish online gaming unit.

It stated HM Revenue & Customs had actually broadened its probe into suppliers GVC utilized in Turkey to include other entities within its group.

GVC offered its Turkish service in December 2017.

The business said it was co-operating with investigation.

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GVC were informed of the development on Monday, however said it had yet to be notified of which of its subsidiaries were being investigated.

It stated it was "shocked by the decision to extend the investigation in this way and are disappointed by the absence of clarity supplied by HMRC regarding the scope of its examination".

"HMRC has actually not yet supplied information of the nature of the historic conduct it is examining, with the exception of a recommendation to section 7 Bribery Act 2010, nor has it clarified which part of the GVC group is under examination."

Section 7 states that a business organisation is guilty of an offence if a person connected with that business allurements another person to acquire or maintain organization, or to obtain or maintain an advantage in the conduct of business.

GVC's share rate was down 10.6% to 778.2 p on Tuesday following the news.

The UK Gambling Commission told the BBC that it was "assisting" with the investigation.

HMRC declined to comment.

In July 2019, GVC was forced to reject reports that it was still gaining from its previous Turkish subsidiary, stressing that it no longer had ties with business.

"The board re-iterates the reality that subsequent to the disposal of the group's Turkish-facing company, GVC has no activity either straight or indirectly linked to the Turkish market," GVC said.

"Furthermore, the board likewise unconditionally refutes suggestions that the group, or senior management, continue to gain from any operations servicing the Turkish market."

Liz Coleman, former HMRC tax inspector and consultant of advisory firm Integrated Dispute Resolution, stated the yohaig code examination might go on for a long time.

"HMRC examinations are generally lengthy and considering the size of GVC it might be going on for many years, although if there's a targeted method it might be much shorter," she stated.

"They need to analyse all the computer system records too, so this could add a lot more time."

The HMRC's choice comes just a week after Kenneth Alexander announced that he was stepping down as GVC's chief executive.

Mr Alexander took over in 2007 and manage the company's acquisitions of competitors Ladbrokes Coral and Bwin.party.

GVC reported a 22% drop in overall net profits for the second quarter this promotion code year due to the effect of the yohaig code Covid-19 pandemic.

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