SEADRILL LIMITED and CONSOLIDATED SUBSIDIARIES (the “Group” or “Seadrill”)
STATEMENT OF TAX STRATEGY
Seadrill is a large and complex group, publicly listed on the Norwegian Stock Exchange and operating in the offshore drilling sector through many companies in different jurisdictions across the globe.
The purpose of this document is to set out the Group's approach to managing its tax affairs globally.
Overall tax strategy
The Group’s global tax strategy is to enhance Seadrill Limited’s shareholder value whilst being committed to complying with all relevant tax rules and requirements in all jurisdictions, taking a fair and reasonable approach to tax and operating to a high standard in the sector in which it operates and reflecting a listed status on the Norwegian and US stock exchanges. At all times, this will comply with Seadrill’s Code of Conduct, which governs our behaviours and principles.
Approach to managing tax risk and establishing good governance
Tax risk arises from complex laws and regulations and the interpretation and application of those in relation to complex business and operational circumstances across multiple territories.
Responsibility for tax at Board level rests with the Chief Financial Officer who together with the Director of Tax advises the Board and Audit and Risk Committee on the tax position of the group on a regular basis. The Board reviews and approves all matters where a material and principal tax impact could arise. Day to day management of the tax affairs of the Group are delegated to the Group Tax function, which reports directly to the Chief Financial Officer.
The Group Tax function maintains processes and controls that ensure the integrity of our tax returns and the accurate and timely payment of tax in countries in which we operate. These are monitored, reviewed and updated to reflect changes in law and business practice.
The Board through the Chief Financial Officer requires and will ensure that Group Tax has and is able to maintain sufficiently skilled resources to maintain the tax strategy of the Group.
Tax law changes frequently and the Group will keep up to date on potential changes in legislation or case law and will take action to mitigate potential costs or take advantage of potential benefits of changes. This will involve relevant employees undertaking suitable training.
Approach to tax planning/how we structure our tax affairs
The Group will strive to ensure that commercial transactions are structured in a tax-efficient way and arranges its affairs, within the law, to reduce the effect of taxation on the Group and its stakeholders (including shareholders, customers and employees) having due regard to its reputation, integrity and status as a Group listed on both the Oslo and New York Stock Exchanges. This may reflect practices commonly operated within the offshore drilling sector. It will claim properly available allowances, deductions, reliefs, incentives, exemptions and credits where it is beneficial to do so but will not engage in abusive tax arrangements.
Attitude to risk
The Group’s attitude to tax risk is aligned to that in all other key areas of the business.
The Group will consider all factors, commercial, technical and reputational, when making decisions on tax and will monitor tax risks and report and escalate risks as appropriate.
The business must consult Group Tax regarding all significant business developments which may have potential tax implications, and Group Tax will keep the businesses updated on relevant tax developments and issues.
External specialist advice will be sought to support a tax position where it is considered appropriate, giving regard to the quantum of tax in issue, the complexity of the relevant rules and the commercial arrangements and circumstances of the issue.
Dealings with tax Authorities
The Group will operate in a transparent, professional and constructive manner with tax authorities globally, even if there are differences of opinion on matters within tax returns, and make appropriate disclosures on relevant issues.
The Group will engage with tax authorities and other relevant bodies, such as the regulators and governments, on tax matters which are important to the Group to ensure a fair and reasonable tax regime. This will include contributing to consultations and commenting on draft legislation.
Published to comply with The UK Finance Act 2016 Schedule 19