The case centred around the Swedish Tax Authorities attempts to establish the worldwide income of Pedr Erik Pråhl and whether Guernsey’s Director of Revenue Services was right to issue notices compelling two trust companies to produce documentation and information relating to him.
In the Ordinary Division of the Royal Court, Lieutenant Bailiff Russell Finch refused an application to bring an appeal against those notices, ruling the case being put forward by the appellants did not have a real prospect of success.
According to the judgement, Mr Pråhl is a Swedish citizen and also has the right of permanent residence in the UK, where he is entitled to vote.
The attempt to make the appeal was brought by Mourant Trustees (Guernsey) as trustees of The Bolero Trust and Carezo (Guernsey) as trustee of the Carezo Trust.
Pictured: Mourant Trustees (Guernsey) and Carezo (Guernsey) both have registered addresses at Royal Chambers in St Julians Avenue.
Advocate Edwards argued on their behalf that the information requested by the notices was not foreseeably relevant to the administration or enforcement of Swedish tax law and that the requests were disproportionate.
Jersey’s tax authority had lost a similar case last year concerning Prahl and Triton Administration, but had made “significant errors”, relying on out of date information.
The judge agreed with submissions that Guernsey’s tax authority asked the right questions of Sweden and got the right answers.
“This is, when the merits are considered, far from removed from a fishing expedition,” said Lt Bailiff Finch in his judgement.
On the proportionality argument, he said: ““The response to the request falls within the scope of international obligations to which Guernsey is subject. In this case not only (of course) are the particular facts very important to those concerned, but so is the wider consideration that the Bailiwick should respond fully and properly from requests from other jurisdictions, which are sound in law, in accordance with binding international agreements.”
He said there was a considerable degree of correspondence between the Director of Revenue Services and the Swedish authorities, and information in great detail had been provided.
These show the director had not “acted as a rubber stamp”
“[The appellant], despite energetic efforts to avoid what he doubtless deems to be the prying eyes of the STA [Swedish Tax Authority], must take the domestic law on residence and assessments as he finds it.”
Judge Finch said the Director’s actions were “lawful and proportionate”.
