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The Commercial Court, in the case of the Organising Committee of the 2014 Olympic and Paralympic Winter Games in Sochi, has recognised as lawful the application of the civil law mechanism for recovering from a foreign person an amount of unjust enrichment in the form of tax that a tax agent has paid on behalf of the foreign person, together with interest for using the other party’s money.
The facts of the dispute
Between 2012 and 2013 the Organising Committee and Pico Projects International Limited (a Hong Kong resident, “Pico Projects”) entered into agreements for the lease of facilities (tent structures) to ensure the temporary infrastructure of the Olympic Games.
When paying the lease payments to Pico Projects, the Organising Committee erroneously did not withhold, as a tax agent, the amount of corporate income tax. After the error that had been committed was identified, the Organising Committee calculated and paid at its own expense the relevant tax amount.
Discover more: Russia’s take on tax disputes
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