For the assessment of the company tax payable by companies which are controlled by, or which control an undertaking established outside Cameroon within the meaning of section 19a below, the profits indirectly transferred to the latter by increasing or reducing the purchase or selling price, or by any other means, shall be incorporated in the resultsof such enterprises. The profits indirectly transferred shall be assessed by comparison with those that would have been realized in the absence of dependency or control.
The condition of dependency or control shall not be required when the transfer takes place with enterprises:
- Established or resident in a State or territory considered as a tax haven within the meaning of Section 8b (new) of the tax Code;
- Subject to a preferential tax regime.
Enterprises shall be considered to be subject to a preferential tax regime in a State or territory if they are not taxable therein, or if their income tax is less than half that which they would have paid under ordinary law.
- The provisions of section 19 (1) of the tax code shall also apply to transactions with affiliated enterprises within the meaning of section 19a of same code, established in Cameroon, particularly where the latter are beneficiaries of a derogatory tax regime.
Dependency or control relationships shall be deemed to exist between two enterprises:
- Where one holds directly or by proxy 25% of the share capital of the other or actually exercises decision-making powers in the other; or
- Where both are placed, under the conditions defined in point (a) above, under the control of the same enterprise or person.
Implementing instruments shall specify, where necessary, detailed rules for the application of the provisions of sections 18b, 19 and 19a of the tax code.
As concerns exportation and related activities, the FOB value of goods shall serve as the minimum turnover to be taken into consideration for the assessment of the taxable result.
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