Huawei: Argentina fined US$ 2 million for software imports

Huawei: Argentina fined US$ 2 million for software imports

The Customs argentina claims argentine subsidiary of chinese technology company. Huawei US$28 million for unpaid taxes and a fine of 407 million pesos (US$2 million), according to official sources.

The claim arises because for the Customs argentina it is not possible for the Chinese firm to import equipment (hardware) without purchasing the software and without canceling the license fees to the foreign parent company, according to an analysis of the related companies area of the Customs on the value of the imports of the Argentine subsidiary of Huawei Tech Investment.

Why was the Chinese giant fined?

The Customs argentina detailed that the Argentine branch of Huawei imported equipment (hardware) for technological developments in. Argentina to its parent company in China.

These equipments are part of global procurements called “Systems”, with technical specifications that make the hardware, software and licensing rights “inseparable”, as they are purchase requirements in an integral way, explained the state agency.

Argentina is based on the fact that it is a party to the General Agreement on Tariffs and Trade (GATT), which establishes that the importer is obliged to pay, in addition to the price agreed for the goods, an additional amount called “canon, license fee or simply royalty” in consideration for the right to use that intellectual creation of the other party, and that sum of money “integrates the value for customs purposes”.

For the Customsthe technology company was fully aware of the license fees it was obliged to pay for the importation of the goods and knew of the existence and amount of such obligation, but only declared the value of the equipment without including the value of the software and licenses in the customs duty base.

For the company’s inaccurate declaration prejudicial to the tax authorities, the. Customs claims the difference in tax and applied the fine. EFE

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Kayleigh Williams