Shionogi Group Tax Policy
Shionogi Group (Shionogi & Co. Ltd and its affiliated companies, collectively “Shionogi”) has Shionogi’s Company Policy, which was first instituted in 1957, which sets forth the purpose of Shionogi’s corporate activities as being “to strive constantly to supply the best possible medicine to protect the health and wellbeing of the patients we serve”.
As a responsible, growing company, Shionogi recognizes that a robust compliance framework is an essential component in achieving its business objectives. To this end, all of Shionogi’s officers and employees strive to maintain and improve compliance through raising their internal awareness. This is grounded in the principle of not only acting in compliance with relevant laws, rules and regulations in the territories in which Shionogi operates, but also considering and understanding the ethical and societal impact of Shionogi’s actions.
Reflecting Shionogi’s commitment towards compliance, Shionogi has implemented the following fundamental tax policy globally.
As Shionogi continues to expand its business and global presence, tax matters have become increasingly important, directly linked to the corporate management of the group. Recognizing this, Shionogi’s Head of Finance and Accounting has implemented a framework that allows for the timely prevention of unforeseen tax matters, and established and maintained a network of direct or indirect reporting through Shionogi’s Head of Tax which facilitates the management of local and international taxation matters.
Shionogi regularly monitors the status of tax matters and tax reforms in order to minimize any tax exposure, including unexpected tax costs and controversy in a rapidly evolving international tax landscape. Shionogi reviews all business matters with a tax implication on a regular basis and identify those areas of tax uncertainty that need to be addressed going forward.
2. Our business activities
Shionogi is engaged in research, development, manufacturing and marketing activities to supply the best possible medicine to protect the health and wellbeing of patients worldwide. To ensure that the Shionogi’s tax positions appropriately reflect these commercial and economic activities and objectives, and to enable efficient tax management, Shionogi formulates a timely and effective tax strategy.
In implementing our tax strategy, Shionogi’s tax team is closely aligned with our business activities to ensure that tax management based on compliance remains a core part of transactions entered into by Shionogi. Conscious of Shionogi’s commitment to corporate social responsibility and striving to make appropriate tax payments in each region and country in which Shionogi operates, Shionogi does not engage in artificial tax arrangements, and seeks to manage tax matters appropriately in the territories in which Shionogi operates.
3. Transfer Pricing
As a multinational company, Shionogi ensures a proper allocation of international income according to the contribution of Shionogi Group companies on an arm’s-length basis. Shionogi also ensures tax compliance in each country in which Shionogi operates, by determining transfer pricing in accordance with current OECD principles.
Shionogi maintains required transfer pricing documentation in each jurisdiction where this is necessary. Moreover, to address unforeseen transfer pricing matters from arising under particularly complex transactions involving multiple jurisdictions, Shionogi seeks to enter into APAs (Advance Pricing Agreements) with the relevant tax authorities, if necessary.
4. Relationship with tax authorities
Shionogi makes efforts to ensure transparency and reliability of reporting of taxation matters, in good faith, to the tax authorities of the countries in which Shionogi operates.
Shionogi seeks to ensure transparency, both by publishing and following this Shionogi’s Tax Policy and by complying with local and global transparency standards, including local disclosure requirements as well as Country-by-Country Reporting (“CbCR”) standards.
Shionogi shall seek to ensure clarity in areas of tax uncertainty, by obtaining advanced clearance from tax authorities as needed.
As the international tax landscape continues to change, Shionogi will strive to remain in compliance with all applicable tax laws and regulations. Whilst aiming to fulfill its mission of providing the best possible medicines to protect the health and wellbeing of the patients we serve, Shionogi will continue contributing to societal development through appropriate tax compliance.
March 19, 2018*
*Our group tax policy is approved by the Board of Directors on the above date, and is implemented across the Shionogi Group.