Cadbury Research Articles

Definition of Tax Planning in the Case Law of the Court of Justice of the EU (ECJ)

The objective of the study is to analyse the current and past case law of the European Court of Justice (ECJ) regarding tax disputes based on the modern legislation of the EU countries and applicable international law to determine the concept and criteria for legal tax planning. This article provides an in-depth study of the well-known Cadbury Schweppes case (2006), including the decision of the ECJ, which laid the foundation for a new concept of examination and interpretation of tax disputes on the merits in general. The introduction of the concept of “wholly artificial arrangements” and their characteristics stipulated and determined the development of the entire field of tax planning for years to come. Other rulings of the ECJ following the case of Cadbury Schweppes have described in greater detail and more specifically the concept of “wholly artificial arrangements” under the influence of the practice of tax planning itself, determining what tax planning is legitimate and how exactly it should be distinguished from tax evasion and tax avoidance. Several research methods have been used in this study: comparative method, historical method, analytic method, inductive method. Keywords: European Court of Justice, freedom of establishment, notion of economic substance, tax disputes, tax planning, wholly artificial arrangements, tax evasion

Teoria płacy wydajnościowej przed Harveyem Leibensteinem

Objective: The article analyses the idea of efficiency wage before H. Leibenstein’s work from 1957 as an example of specific cognitive bias. The bias centers around the rejecting or neglecting of empirical data not in accordance with theories of mainstream economics.Research Design & Methods: The method used was comparative analysis of economics texts.Findings: The article shows that the concept of the efficiency wage was often neglected and marginalized, supposedly because it could have paved the way to unorthodox economic theory, and away from the dominant laissez-faire thinking of most ecomomists. H. Leibenstein shows a case in which higher wages implicate higher efficiency. This is the special case of low-paid workers, who in consequence are better nourished, thus gaining strengthen and vitality, which in turn makes them better labourers. Another factor in H. Leibenstein’s analysis was the motivating function of higher wages. Efficiency wage effects were known to economists as well as managers long before H. Leibenstein. Practitioners of efficiency wages have included R. Owen, Cadbury brothers and H. Ford, while more theoretical-oriented economists have included authors from A. Smith to A. Marshall.Implications / Recommendations: Efficiency wage theory was revealed and forgotten many times before H. Leibenstein. This phenomenon is an example of a well-known cognitive bias: neglecting evident facts that are incompatible with established theories and are thus treated as irrelevant anomalies.Contribution: Part of the analysis done for this article may become a part of a research programme showing ways economists make theoretical choices. This article will contribute to such a programme.

X‐GmbH v Finanzamt Stuttgart – Körperschaften: Abuse of Tax Law and Exchange of Tax Information in EU law

AbstractThe Court of Justice of the European Union has taken an evolutionary approach to the understanding of an EU standard for the prevention of abuse of tax law under EU primary law (the free movement of capital) in a landmark case regarding the rules on German controlled foreign companies (CFC rules). This case note contrasts the narrow understanding of wholly artificial arrangements under Cadbury Schweppes Overseas Ltd v Commissioners of Inland Revenue with a seemingly broader one in X‐GmbH v Finanzamt Stuttgart – Körperschaften. The note then examines the link between the genuine exchange of tax information with third countries as a way of ensuring effective fiscal supervision, and the prevention of tax avoidance. Finally, the significance of X‐GmbH is highlighted to all the Member States in respect of the transposition of Articles 6, 7 and 8 of the Anti‐Tax Avoidance Directive, and for third countries, and the compatibility of the UK's diverted profits tax with EU law.

Saving the ATAD CFC Regime Through Abuse of Law or the Rule of Reason

This article revisits the debate about the extent to which the controlled foreign company (CFC) rules in the Anti-Tax Avoidande Directive (ATAD) are compatible with the EU fundamental freedoms. It considers why the ATAD CFC rules may restrict those freedoms and whether that conflict may be resolved by recourse to the general principle of abuse of law, which may prevent a taxpayer from relying on a fundamental freedom and thus prevent the restriction from arising, or to the rule of reason, which may serve to justify the restriction. The paper considers whether these may be treated as separate doctrines and some implications of doing so. The paper reaffirms that the ATAD CFC rules may be considered to be incompatible with the fundamental freedoms as interpreted in Cadbury Schweppes. Then, by reference to recent CJEU decisions, the paper interprets new standards of artificiality and reassesses the aforementioned incompatibility. Firstly, the now expanded anti-abuse principle may, in many instances, prevent the restriction from arising. Secondly, the now more generous rule of reason holds the restriction largely justified in relation to third states, and this should be extended also to intra-EU situations. Ultimately, the ATAD CFC regime is likely to be considered mostly compatible with the fundamental freedoms. Direct tax, EU law, ATAD, CFC rules, Cadbury Schweppes, fundamental freedoms, rule of reason, abuse of law, overriding reason in the public interest, avoidance.

Opinion Statement ECJ-TF 4/2019 on the CJEU Decision of February 26, 2019, in Case C-135/17, X-GmbH, Concerning the Application of the German CFC Legislation in Relation to Third Countries

This article deals with case, X-GmbH (Case C-135/17) concerning the compatibility of German CFC legislation with regard to third countries. In Germany, CFC legislation only applies in cross-border situations and not in purely domestic situations. In general, the application of CFC legislation requires that the shareholders have control over the foreign subsidiary, that the foreign subsidiary be taxed at a lower rate and that it earn passive income. Concerning a special type of passive income, there is even no control requirement. In relation to other EU and EEA countries, Germany does not apply its CFC legislation if the taxpayer proves that the company carries on a genuine economic activity. However, this Schweppes exception does not apply in relation to third countries. The referring German Court asked whether the relevant German tax rules were compatible with the TFEU provisions on the free movement of capital. The first and second question concerned the interpretation of the standstill clause in article 64(1) of the Treaty on the Functioning of the European Union (TFEU) (2007). With its third question, the German Court inquired whether the Cadbury Schweppes jurisprudence can be transferred to the free movement of capital. The CFE Tax Advisers Europe note that the Court's decision in X GmbH constitutes a continuation of the Court's prior case law regarding the meaning of the standstill clause. The CFE welcomes the clarification with regard to the question of whether a restriction already existed on 31 December 1993. The Court further developed its Cadbury Schweppes (Case C-196/04) jurisprudence, illustrating how to interpret the phrase wholly arrangements in relation to the free movement of capital. The Court held that this concept has to be interpreted in a broader way in relation to third countries. It would be helpful if the Court were to give further guidance in a future decision on the meaning of artificial transfer of profits. X GmbH is also likely to be relevant in respect of domestic legislation implementing articles 7 and 8 of the EU Anti-Tax Avoidance Directive (2016/1164) (ATAD) in that Member States will also have to apply the substance escape to third countries with an exchange of information clause.

Products Packaging and Its Effects on Consumer Patronage of Cadbury Plc Nigeria

Products Packaging and Its Effects on Consumer Patronage of Cadbury Plc Nigeria

The Cadbury Schweppes judgment and its implications on profit shifting activities within Europe

In 2006, the European Court of Justice (ECJ) decided with the Cadbury Schweppes judgment that European Controlled-Foreign-Company (CFC) rules infringe the principle of freedom of establishment and restricted the applicability thereof. This paper analyzes the impact of mandatory amendments to European CFC rules on tax planning activities within Europe. Using a difference-in-differences approach, my results provide robust evidence that pre-tax earnings of subsidiaries located in European low-tax jurisdictions have increased by around 10% after the Cadbury Schweppes judgment. My analysis shows further that the increase in pre-tax earnings is related to facilitated profit shifting activities. Multinational corporations with high incentives or enhanced profit shifting opportunities react more to the Cadbury Schweppes judgment. The findings point out that CFC rules became less effective, and thus, profit shifting activities within Europe are less restricted after the ECJ judgment. Additional tests suggest further that on average 85% of the increase in pre-tax earnings is attributable to strategic transfer pricing determination, while less than 15% is attributable to debt shifting activities.

The Cadbury Schweppes Judgment and Its Implications on Profit Shifting Activities within Europe

In 2006, the European Court of Justice (ECJ) decided with the Cadbury Schweppes judgment that European Controlled-Foreign-Company (CFC) rules infringe the principle of freedom of establishment and restricted the applicability thereof. This paper analyzes the impact of mandatory amendments to European CFC rules on tax planning activities within Europe. Using a difference-in-differences approach, my results provide robust evidence that pre-tax earnings of subsidiaries located in European low-tax jurisdictions have increased by around 10 % after the Cadbury Schweppes judgment. My analysis shows further that the increase of pre-tax earnings is related to facilitated profit shifting activities. Multinational corporations with high incentives or enhanced profit shifting opportunities react more pronounced to the Cadbury Schweppes judgment. The findings point out that CFC rules became less effective and thus, profit shifting activities within Europe are less restricted after the ECJ judgment. Additional tests suggest further that on average 90 % of the increase in pre-tax earnings is attributable to strategic transfer pricing determination, while less than 10 % is attributable to debt shifting activities.

Brand Awareness and Brand Preference for Carbonated Soft Drinks: Evidence from Cadbury Schweppes Ethiopia Research Evidence from Life Experience

<p>When Schweppes entered the Ethiopian soft drink market viable competitors were Pepsi and Coca Cola. However, its entry into the soft drink market was largely meant to realize its potential to serve a large chunk of the Ethiopian soft drink flavor market which was under-served by the two giants. Whether this market niche provided sustained and superior returns was dependent on the business environment. It was in this environment that Schweppes had carried out a series of promotional campaigns to increase the sale of its wide range products in the market. The research on the effectiveness of the promotional campaign showed that quite significant number of potential consumers was exposed to the brand advertisement. The research result also indicated the awareness rate as measured by the frequency of exposure to the media within a short span of time. The analysis highlighted the rate of brand recall, brand trial and favorite brand usage. The method used in this sample testing survey sampling 2171 consumers made no pretense of being exhaustive. Commercial recall testing was carried out in different outlets by interviewing a random sample of consumers using a standard questionnaire. Consumers were sampled from groceries, hotels, restaurants, supermarkets, clubs, crowded streets and Mercato depot area. The survey was carried out in 2000. The author developed this research in his capacity as marketing development manager for Schweppes-Summit International.</p>

Review of 'A History of the County of Somerset. Volume XI: Queen Camel and the Cadburys'

Review of 'A History of the County of Somerset. Volume XI: Queen Camel and the Cadburys'

Nestlé v. Cadbury (KitKat)

Nestlé v. Cadbury (KitKat)

Historical origins between National Medical Association of China and Boji Hospital in Guangzhou

In 2015, National Medical Association of China, now being called the Chinese Medical Association, celebrates its centennial and Boji Hospital in Guangzhou ( also known as Canton Hospital, or the Canton Pok Tsai Hospital, and now Sun Yat-sen Memorial Hospital of Sun Yat-sen University ) marks its 180th anniversary. Three major historical events establish the role of Boji Hospital in the founding and development of the National Medical Association of China during the last 100 years, viz.: ①hosting and participating in the establishment of the Medical Missionary Association of China and its official journal: the China Medical Missionary Journal; ②holding the 11th scientific sessions of the National Medical Association of China; ③nominating Dr. Wu Lien-teh as a candidate for the Nobel Prize in Physiology or Medicine in 1935 by William Warder Cadbury, the president of Boji Hospital.

“사회적 기업”의 모델, 캐드버리 기업(The Cadbury brothers Ltd.)의 기업정신과 기업문화

“사회적 기업”의 모델, 캐드버리 기업(The Cadbury brothers Ltd.)의 기업정신과 기업문화

The Concept of ‘Abuse of Law’ in the Case Law of the European Court of Justice on Direct Taxation

Time and again, the Court of Justice has made clear that EU law does not protect natural or legal persons who seek to pay less tax by creating situations that artificially fall within the scope of application of the fundamental freedoms. In the light of the judgments of the Court of Justice in Cadbury Schweppes, Thin Cap and Glaxo Wellcome, this contribution describes the steps that a national court must follow when determining whether a particular behaviour constitutes an abuse of law in the field of direct taxation.

CFC legislation in the European Union

In this paper the author considers CFC legislation in the Member States of the European Union, and points to the official attitude of the institutions of the European Union toward CFC legislation. Special attention in this paper is focused on Judgment of the Court of Justice of the European Union in the case Cadbury Schweppes. The aim of the paper is to analyze CFC legislation in the Member States in order to determine its basic characteristics, as well as to determine its compatibility with freedoms guaranteed by the primary law of the European Union, i.e. with Judgment of the Court of Justice of the European Union in the Cadbury Schweppes case.

Kraft Foods, Inc. in India — The Cadbury Acquisition

When the United States-based Kraft Foods, Inc. (KFI) acquired the United Kingdom-based Cadbury plc, KFI got entry into the Indian market. KFI CEO, Irene Rosenfeld had targeted the developing markets as key for the company to achieve a 5% organic growth rate and the strong position of Cadbury India augured well for expanding KFI's presence in that market. However, after nearly a year since the acquisition, KFI was moving slowly in India and appeared content to consolidate Cadbury's market presence. Anand Kripalu, President of KFI South Asia and Indo-China and Managing Director of Cadbury India was to meet his superiors to present his strategic plan for the India operations. He had a critical decision to make regarding whether to continue consolidating the Cadbury brand in India or use Cadbury's strong market presence to launch brands from KFI's global portfolio.

Brand Awareness and Brand Preference for Carbonated Soft Drinks: Evidence from Cadbury Schweppes Ethiopia

When Schweppes entered the Ethiopian soft drink market viable competitors were Coca Cola and Pepsi. However, its entry into the soft drink was largely meant to realize its potential to serve a large chunk of the Ethiopian soft drink flavor market which was under-served by the two giants. Whether this market niche provide sustained and superior returns were largely dependent on the business environment. It was in this environment Schweppes has carried out a series of promotional campaigns to increase the sale of its wide range of products in the market. The research on the effectiveness of the promotional campaign shows that quite a significant number of potential consumers was exposed to the brand advertisement. The research result also indicated the awareness rate as measured by the frequency of exposure to the media within a short span of time. The analysis highlights the rate of brand recall, brand trial and favorite brand usage. The method used in this sample testing survey sampling 2171 consumers makes no pretense of being exhaustive. Commercial recall testing was carried out in different outlets by interviewing a random sample of consumers using structured questionnaire. Consumers were sampled from hotels, restaurants, groceries, supermarkets, clubs, crowded streets and Mercato depot area. I developed and executed this research while working in the capacity of marketing development manager for Schweppes International.

Happiness and Work: Portuguese Peasants, British Laborers, African Contract Workers, and the Case of São Tomé and Príncipe, 1901–1909*

AbstractIn the first decade of the twentieth century, the allegation that slaves were harvesting cocoa off the west coast of Africa on the Portuguese island colony of São Tomé and Príncipe became an international scandal, not only because slavery had long been outlawed, but also because one of the major purchasers of that cocoa was the Quaker chocolate company, Cadbury Brothers. The Portuguese denied the charge of slavery and claimed that African workers on the islands were not only happier than Portuguese peasants, but also more content than many European workers. This article explores this claim and argues that the conflicting interpretations of what the British called the crisis over “slave cocoa” and the Portuguese called “the English cocoa controversy” can be explained by differing perspectives about work.

Are the Danish CFC Rules in Conflict with the Freedom of Establishment? – An Analysis of the Danish CFC Regime for Companies in Light of ECJ Case Law

Unlike other Member States, Denmark reacted to Cadbury Schweppes (C-196/04) by widening the scope of application of its CFC legislation for companies to purely domestic situations. Inspired by the BEPS Report recommendation on strengthening CFC legislation – and in light of the lack of certainty under existing ECJ case law – this article analyses whether or not the Danish CFC rules applicable to companies should be considered in line with the freedom of establishment.

Chocolate islands: cocoa, slavery, and colonial Africa

Higgs's Chocolate Islands: Cocoa, Slavery, and Colonial Africa is an elegantly written, well-illustrated account of the ensuing investigations into this so-called new slavery in Africa orchestrated largely by Cadbury and the British Foreign Office...[The] study resonates today, dealing, as it does, with the often tainted international origins of our later era of mass consumerism. -American Historical Review In Chocolate Islands: Cocoa, Slavery, and Colonial Africa, Catherine Higgs traces the early-twentieth-century journey of the Englishman Joseph Burtt to the Portuguese colony of Sao Tome and Principe-the chocolate islands-through Angola and Mozambique, and finally to British Southern Africa. Burtt had been hired by the chocolate firm Cadbury Brothers Limited to determine if the cocoa it was buying from the islands had been harvested by slave laborers forcibly recruited from Angola, an allegation that became one of the grand scandals of the early colonial era. Burtt spent six months on Sao Tome and Principe and a year in Angola. His five-month march across Angola in 1906 took him from innocence and credulity to outrage and activism and ultimately helped change labor recruiting practices in colonial Africa. This beautifully written and engaging travel narrative draws on collections in Portugal, the United Kingdom, and Africa to explore British and Portuguese attitudes toward work, slavery, race, and imperialism. In a story still familiar a century after Burtt's sojourn, Chocolate Islands reveals the idealism, naivety, and racism that shaped attitudes toward Africa, even among those who sought to improve the conditions of its workers.