Amazon shares closed higher in the US Friday, but are poised to open lower Monday, when the US markets open. That move comes as the global tech and eCommerce behemoth has settled a longstanding French tax row.
Amazon shares closed 2.87% higher at $1,429.95 Friday. However, pre-market activity has the Amazon stock price over 1% lower as the US open draws closer.
Amazon tax row dates back five years
The fee it has agreed to pay the French tax authorities is undisclosed. But, it relates to a tax payment request for around €200 million from France in 2012, covering the tech giant’s earnings between 2006-2010.
The tax payment request related to Amazon’s European tax planning which included routing much of its profits through Luxembourg. France’s Direction generales des Finances publiques said the bill covered taxes that weren’t reported and penalties relating to that.
“We have reached a comprehensive settlement agreement with the French tax authorities on past issues and our main objective remains to provide the best possible buying experience for our clients in France,” Amazon said in a statement, according to numerous news outlets.
Since the initial tax charge was issued in 2012, Amazon has created a local French Amazon branch and now ensures all local charges related to French sales are handled accordingly.
The French tax office is far from the first to seek payments from the global tech firm.
China’s JD.com eyes European eCommerce disruption
While Amazon settles this latest tax issue, news has emerged that China’s online retailer JD.com plans to launch numerous European eCommerce platforms in 2019.
In an interview with the FT.com, JD.com’s founder and CEO Richard Liu, said he will invest around $1 billion in the European eCommerce market over a two-year period.
Amazon is hugely popular across Europe and already has established offices and fulfilment centres across the continent. While JD.com’s investment into Europe pales in comparison to Amazon’s, it could still disrupt Amazon’ dominance.