Italian prosecutors have requested that Campari (BIT:CPR) chairman Luca Garavoglia stand trial over allegations involving €1.29 billion in unpaid taxes linked to the restructuring of the company’s controlling shareholder, Reuters reported on Thursday, citing two people with direct knowledge of the proceedings.
Prosecutors in Monza have also sought a trial for Giovanni Berto, the legal representative of Lagfin, the Luxembourg-based family holding company that controls the Italian spirits producer.
The investigation concerns allegations of fraudulent tax declarations connected to a corporate restructuring that transferred the ownership structure of Campari’s controlling shareholder to Luxembourg.
According to the report, investigators identified approximately €5.3 billion in capital gains that they allege were not declared between 2018 and 2020.
Prosecutors maintain that Lagfin failed to pay €1.29 billion in exit tax on those gains. Exit taxes can apply when companies transfer their tax residence from one country to another.
The allegations remain subject to judicial examination, and the request for trial does not constitute a finding of guilt.
Investigation Centres on 2018 Merger Involving Campari Holding Companies
The case relates to a 2018 merger between Alicros, the Italian company that previously controlled Campari, and Lagfin, which held a majority stake in Alicros.
The transaction combined the two entities into a single holding company with a 51% interest in Campari, whose stock market valuation at the time exceeded €4 billion.
Following the merger, the corporate structure was transferred to Luxembourg.
According to Reuters, prosecutors and Italy’s Guardia di Finanza financial police allege that the restructuring was designed to avoid the exit tax that would otherwise have applied when the company moved its registered office outside Italy.
Investigators contend that the transaction generated substantial taxable capital gains that were not properly declared to the Italian authorities.
The inquiry resulted in the seizure of Lagfin shares valued at approximately €1.29 billion in October of the previous year, corresponding to the amount of tax allegedly unpaid.
Lagfin Previously Agreed €405 Million Tax Settlement
The criminal proceedings follow a separate tax dispute between Lagfin and Italy’s Revenue Agency.
In December, the holding company reached a settlement with the tax authority, agreeing to pay €405 million through a series of instalments, according to the report.
The settlement addressed the tax dispute but did not resolve the separate criminal investigation.
Under Italian law, administrative tax proceedings and criminal cases operate independently, meaning that an agreement with the tax authorities does not automatically determine the outcome of a related criminal investigation.
When the settlement was announced, Lagfin maintained that its activities had always complied fully with the applicable legal requirements.
The company’s position remains at odds with the allegations made by prosecutors concerning the 2018 restructuring.
Judge to Decide Whether Case Proceeds to Trial
The next stage of the proceedings will involve a preliminary hearing before an Italian judge.
The judge must determine whether sufficient grounds exist to send Garavoglia and Berto to trial or whether the criminal case should be dismissed.
No final judicial determination has been made regarding the allegations.
Garavoglia, 57, has served as Campari’s chairman since 1994 and is the company’s largest shareholder through Lagfin.
Lawyer Giuseppe Iannaccone, who represents both defendants alongside Nerio Diodà, expressed confidence that the legal proceedings would establish their innocence beyond any doubt, according to Reuters.
The defence position follows Lagfin’s earlier statement that the holding company had consistently operated in accordance with all relevant laws.
The case now awaits the scheduling of the preliminary hearing, which will determine whether the allegations proceed to a full criminal trial.
Leave a Reply