Royal Dutch Shell Plc  .com Rotating Header Image

The man who terrifies Unilever and Shell

Translation of an article published 22 Dec 2020 by the Dutch Financial newspaper, the FD. 

 

The man who terrifies Unilever and Shell

…it turned out that Shell, Philips and Akzo, among others, did not pay profit tax in the Netherlands, to the indignation of Snels. Now that the cabinet has adopted its ‘Shell law’, that detour has been closed on 1 January.

Lisa van der Velden Ulko Jonker 22 Dec.2020

In the past six months, GroenLinks MP Bart Snels played a cat-and-mouse game with food giant Unilever. But then the cat packed up and moved to the UK. While the game has not yet been played, as far as Snels is concerned. “I thought Unilever would be wise.”

For Unilever, GroenLinks was nothing more than an opposition party in one of the many countries where the multinational operates. But these days, Unilever’s Scottish CEO can pronounce the party’s name pretty well, including the Dutch ‘gr’.

GroenLinks wants companies that leave for countries without dividend tax to settle with the Dutch tax authorities first. A bill on this has completely changed the tone of the discussion about Unilever’s move, CEO Alan Jope said in an interview with the FD in mid-December. He called the criticism of multinationals ‘an unusual phenomenon for the Netherlands’.

But according to Member of Parliament Bart Snels (54), Unilever is responsible for the criticism it received. “As long as large companies do not pay a fair share of taxes, there will be frustration and distrust,” says the financial spokesman at the long table in the Regentenkamer of the old Ministry of Colonies, now part of the House of Representatives. “Because the profits of globalization are not fairly distributed, we now have Brexit and Trump.”

The ruby-red walls of the conference room have portraits of governors and governors-general who ‘accomplished something great’ in the Dutch East Indies. Snels wants that in his own way too. ‘As a Member of Parliament you are a representative of the people, controller of the government and legislator. In my case, the balance leans towards the legislator. I want to change and improve things. ‘

One of the first things he changed as a Member of Parliament was barricading a ‘fiscal detour’ in the so-called liquidation loss scheme. Thanks to this diversion, it turned out that Shell, Philips and Akzo, among others, did not pay profit tax in the Netherlands, to the indignation of Snels. Now that the cabinet has adopted its ‘Shell law’, that detour has been closed on 1 January.

Snels has now been building a new law for a year, which should close gaps in dividend tax. Companies that move to a country without dividend tax will avoid that tax. Snels sees this as a form of tax avoidance.

So when the British-Dutch Unilever announced in June that it wanted to become a British company and later also indicated to Shell that it was thinking about moving to London, he knew he had to hurry. After all, the United Kingdom does not levy dividend tax. ‘If I kept working, I could still influence the decision-making.’

Because of that haste, the first version of his ‘Unilever law’ was incomplete, the MP acknowledges. After a damning advice from the Council of State, he amended the proposal. Despite this, the impact was maintained. If his proposal passes, Unilever shareholders will have to pay an exit tax of € 11 billion. ‘And for Shell the sum has been calculated at € 8 billion.’

No wonder that tension at Unilever has risen to unprecedented levels in recent months. Such a high charge is not in the best interest of the company, it wrote in its prospectus. At the same time, the lawyers hired by the multinational (‘three offices!’, Says Snels with a laugh) do not consider the bill to be viable. It would be in conflict with several treaties.

Snels wanted to discuss this, he says. ‘I was curious about those legal advice. But when I approached Unilever, they asked if I could indicate in bullet points what I wanted to talk about. Then I thought: never mind. You can read the newspaper, right? What kind of behavior is this? ‘

Bart Snels: ‘Other companies do take the law into account. Shell is really not going away now. ‘ Photo: Kiki Groot for the FD

Ultimately, Unilever persisted. Since November it is only a British company. “It has become a game of cat and mouse, but I thought they would be sensible,” says Snels. ‘Other companies do take the law into account. Shell is really not going away now. ‘

It is a miscalculation that Unilever has not waited to see if the law will fail, says the MP. Several government parties are enthusiastic about the proposal, despite the criticism. ‘Leaving now is arrogant, just as the financial sector was arrogant until 2008. He has learned lessons from that. ‘

Ultimately, he can help this law to a majority, Snels insists. How? After the parliamentary elections on March 17, GroenLinks may have more power than in the opposition, he suggests. Meaningful smile: “The bill could also end up on the formation table.”

Business climate

It should be clear: next year GroenLinks wants to rule. Former journalist and former spin doctor Snels is number six on the candidate list and an important confidant of party leader Jesse Klaver. They are both from Roosendaal, but only discovered later that their lives were intertwined. Klaver’s mother turned out to be a classmate of Snels.

The MP has ‘fairly radical views, but is radically reasonable in cooperation,’ he says twice. ‘I like to work together, I’m good at that. Ultimately, everyone must participate in the democratic conversation, including us as politicians. Where do we want to go, what role do you have to play, how do you ensure that the contradictions do not become too great? If that doesn’t happen, democracy won’t work. I feel that responsibility very strongly. ‘

Banks and large companies such as Shell, Unilever and Philips should also participate in the conversation, says Snels. ‘They belong to the elite of the Netherlands. So take up your role and don’t lock yourself up in your own stronghold. ‘

Snels talks about a turning point. Even the front pages of the Financial Times announce the end of capitalism. This crisis shows the vulnerabilities. The labor market that is not functioning properly. Flex workers, young people and freelancers who take the blows. Small companies that fall first, growing inequality and big tech bosses walking in. These are all consequences of our economy, which has been designed so liberally that the interests of large companies come first. The framework proposed for this is always the same: the business climate. That is no longer tenable. ‘

Even at the VVD, Snels now sees a different wind blowing. ‘In the previous formation, the abolition of dividend tax was still in the coalition agreement and two Rutte cabinets had implemented cutbacks and tax increases for € 50 billion, to the detriment of the middle class. But since the debuffs with the dividend tax and large companies that do not pay profit tax, they have taken a different course. You have a different conversation with this VVD than you were five years ago. ‘

Climate change

Meanwhile, the same VVD is untouchable high in the polls and GroenLinks dangles around 14 seats – the same number as four years ago. Snels’ tipping point does not appear to be visible among voters. Yet the Member of Parliament is not worried. ‘People are not yet on March 17. For our constituents, the single most important issue is climate change. They know that we only have ten years to stop it and that we need to take steps forward in the coming cabinet term. This realization runs deep in a large group of people. ‘

Climate change was once a topic on the left, but is now also an issue for companies, Snels sees. ‘Also because of Unilever’s sustainability ambitions, it is tragic that the company left. There are two souls in my chest in that regard. On the one hand, they have to pay tax fairly. On the other hand, we also need them in our society. ‘

Ultimately, his fight for other taxes is certainly not all fun, says Snels. ‘It takes a lot of time, is extremely complicated and often quite lonely. You stand alone against the Dutch Association of Tax Advisers, the employers’ lobby of VNO-NCW and the large business community. I often sigh for that, because they are such invisible forces. Talk to me!’

CV

1966 Born in Roosendaal

1985-1991 Economics, Tilburg University

1991-1993 Replacement compulsory military service at the scientific bureau GroenLinks

1996-2001 Policy officer GroenLinks fraction, Lower House

1998-2001 Part-time assistant professor of general economics, University of Twente

2003-2004 Editor macro-economics at the weekly FEM Business

2004-2009 Director scientific bureau GroenLinks

2009-2011 Campaign leader GroenLinks in parliamentary elections

2010 2012 Member of the campaign team D66 leader Alexander Pechtold

2014-2015 Editor at TV program Buitenhof

2015-2017 Advisor and copywriter for Jesse Klaver, GroenLinks party leader in the House of Representatives

2017-present Member of Parliament on behalf of GroenLinks, financial spokesperson

Also read

Unilever CEO about the hostility in the Netherlands: ‘The criticism of multinationals is unusual’

Council of State advises against exit tax for multinationals

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “The man who terrifies Unilever and Shell”

Leave a Comment

%d bloggers like this: