Date filed
28 November 2013
Countries of harm
Current status


War on Want and Change to Wins complaint against Alliance Boots alleges that the company has violated the Guidelines disclosure and taxation provisions. The complaint contends that from 2009 to 2013, Alliance Boots Executive Chairman Stefano Pessina engaged in a series of transactions with insider-controlled entities trading in the companys debt, which may have significantly enriched those connected with the entities at the expense of the company and taxpayers.

The complaint also alleges that Alliance Boots failed to disclose important information that would allow the public and stakeholders to gauge the fairness and transparency of the terms of the transactions, the appropriateness of the handling of potentially significant conflicts of interest, and the adequacy of its corporate governance policies.

Further, Alliance Boots has allegedly not acted in accordance with the spirit of UK taxation laws by shifting profits to offshore tax havens using complex financial instruments, shell financial companies in Luxembourg, and payments from one party to another to finance the purchase of company debt in a circular manner.

The complainants seek mediation to bring concrete reforms of the companys governance, tax, and disclosure procedures so they are aligned with the Guidelines.

Relevant OECD Guidelines


After receiving the complaint, the UK NCP felt it would be more appropriate for the Swiss NCP to handle the case. The UK NCP tried to transfer it to the Swiss NCP, but the Swiss NCP was of the opinion that the issues had arisen in the UK and should therefore be handled by the UK NCP. The UK NCP then conducted an initial assessment on its own. On 11 May 2014, the UK NCP provided the parties with a draft initial assessment for comment and clarification. One week later, on 19 May 2014, the NCP rejected complaint, claiming the allegations were unsubstantiated. This despite the fact that complainants had provided a detailed, evidence-based response to the draft initial assessment. The NCP did not make it clear to the complainants why it was applying such a high threshold for substantiation or even what it would consider such substantiation to entail.

For example, the company told the NCP, without substantiation, that it had made full disclosure of these transactions to shareholders. The complainants pointed to a large class of investors who held collateralized loan obligations of the company and noted that the company did not claim to have made disclosure to these investors. Nevertheless, the NCP relied upon a blanket statement from the company and concluded: “It appears to the UK NCP highly unlikely that the investors were not fully aware of all material information relating to the transactions.”

The NCP appears to have also concluded that because the transactions “relate[d] to the underlying financing of the company rather than to its operation or sales” and because the “companys taxable profits (including taxable profits in the UK) increased over the period during which the transactions took place” the violations of the tax chapter were unsubstantiated. Complainants insist that neither of these points support a conclusion that the tax provisions was not violated. Financing, especially debt financing, is often used to shift profits offshore, as is made clear in the OECD’s Base Erosion and Profit Shifting (BEPS) Action Plan. Additionally, it is quite possible for a company to increase taxable profits even as it continues to shift profits abroad and undertake a program of tax avoidance. Complainants made both of these points to the NCP in their response to the draft initial assessment, but the NCP continued to rely upon flawed logic in its assessment.

The NCP also relied upon the fact that UK tax authorities had not condemned the company for failing to meet its tax obligations. The complainants note, however, that corporate responsibilities under the OECD Guidelines often go above and beyond the law, and that a lack of state enforcement should in no way be taken to mean that a company is, in fact, in compliance with the Guidelines.

More details

Affected people
Date rejected / concluded
19 May 2014


  • 19 May 2014

    The UK NCP rejected the complaint claiming the allegations were unsubstantiated.

    NCP UK
  • file
    28 November 2013

    Complaint filed with UK NCP

    War on Want