LONDON (Alliance News) - Telit Communications PLC said Wednesday its Italian subsidiary has agreed to pay EUR400,000 to resolve its dispute with the country's tax authorities.
The company said it has paid the fee "without any admission of liability to close this matter and to avoid associated costs and distraction".
At the beginning of 2018, the Italian tax authorities appealed to the Italian Supreme Court over past decisions by lower courts in favour of Telit. Two tiers of lower level tax courts found in favour of the AIM-listed company in the matter, regarding VAT assessments.
The Italian tax authorities issued three VAT assessments in December 2014, which Telit appealed at the first-level tax court. These were upheld by the tax court in December 2015, and the assessments were therefore annulled. The Italian tax authorities subsequently filed an appeal against this decision, which was again rejected in June 2017.
Separate from the dispute on the merits of the assessments, the Italian tax authorities issued penalty deeds against Telit in August 2015.
Telit has previously been informed that the first level tax court in Italy rejected appeals filed by Telit against these penalty deeds.
The company intends to appeal and "vigorously defend its position" and has been advised that its "position in this matter remains strong".
The aggregate value of the penalty deeds remains approximately EUR5 million, as set out in the group's 2016 annual report.
Shares in Telit Communications were flat Wednesday at 185.00 pence each.
In the UK, the Financial Conduct Authority has recently expanded the scope of its ongoing investigation into the company.
In March last year, the FCA launched an investigation into "the timeliness of announcing certain matters included in Telit's interim results", which were published in August 2017. The investigation was then expanded to cover the "accuracy" of a trading update and a share placing announced in 2017.
The wireless services provider has previously stated it has changed the entirety of its board since the events in question.
The company has been fighting scandal for over a year now, after its former chief executive, Oozi Cats, resigned in August 2017, following reports over his alleged links to US fugitive Uzi Kats.
In May 2017, Cats sold a 5.5% stake in the company, or around 7.1 million shares at a price of 340 pence each, through controlled entities Boost BV and Mariselia Ltd. At that time, it was stated he was selling the shares in order to repay a loan.
He was then forced to resign after questions were raised about his true identity, with Italian media reporting that Cats might be the same Uzi Katz that was on the run from US authorities over allegations of wire fraud in the US state of Massachusetts in 1992.
