Following a tip off from Interest.co.nz, the Companies Office is asking Netflix NZ whether it needs to file financial statements here, like any other large overseas company.
Frustrated by Netflix' apparent lack of understanding of New Zealand law, Interest.co.nz asked MBIE business unit the Companies Office why Netflix had never filed financial statements for its operations in New Zealand.
A Companies Office communications advisor replied on behalf of Sanjai Raj, Registrar of Companies.
Under subpart 2 of the Companies Act 1993, "every large overseas company that carries on business in New Zealand" needs to file annual financial statements.
And under s45 of the Financial Reporting Act 2013, a overseas company is "large" if its revenue exceeds $11 million in each of the two preceding financial years.
So might Netflix not meet that definition?
"At this time, the Registrar of Companies holds no information that would indicate that Netflix New Zealand Limited is ‘large,’" the Companies Office said.
Interest.co.nz then emailed MBIE chief executive Carolyn Tremain to ask how the Companies Office was fulfilling its duty to "ensure compliance with the Companies Act 1993" when a simple Google search turns up an estimate that Netflix has 1,206,520 New Zealand subscribers.
Multiplying by the cheapest Netflix package of $17.99 a month gives a minimum revenue of $21.7 million a month, or $260.4 million a year.
Tremain asked Raj to respond.
"In light of information shared by you, the Companies Office has initiated contact with Netflix New Zealand to ascertain whether it needs to file financial statements," Raj said on 18 July.
Interest.co.nz has asked Netflix for comment via its lawyers, Wellington's Quigg Partners.
9 Comments
Great work - looking forward to seeing Netflix trying to squirm their way out of this one!
Won't they just say people are connecting to and buying from Netflix Cayman Islands etc?
If that's the case - then they shouldn't be limiting my content due to me being domiciled in NZ. I want the same content as the USA if borders don't matter...
There are a huge number of offshore companies which do not file, despite being required to, as there is no consequence for them not doing so. I come across this constantly
Silly question. If they don't bother about filing financials, do they bother with GST returns or paye?
Can't wait to hear the Netflix response.
If they've got any sense they'll apologise and own it, rather than stonewalling or trying and bat it away with bullshit.
Or are they protected by Trump's tax rules?
Why does Govt always play tough with benefit fraudsters and student loan defaulters, but then lets big foreign companies away without any vigilance?
Interest.co.nz Finders fee = 25% of any fines or addional tax revenue generated?
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