After opening an investigation into a 2.9 billion euros ($3.2 billion) capital increase in a Belgian company owned by French billionaire and chief executive of LVMH – parent to Louis Vuitton, Celine, Givenchy, Loewe, and Pucci, among other fashion and non-fashion companies – Bernard Arnault in 2012, Brussels prosecutors announced this week that they have settled the matter.
Belgian authorities have confirmed that Arnault has accepted a deal to end the case. He has done so”without any prejudicial admission of guilt on his part,” prosecutors said, without offering any further details, according to Reuters.
The new first broke in November 2013 that authorities were looking into Pilinvest, a holding company in Belgium, to which Arnault – who made headlines in early 2013 after applying for Belgian nationality – reportedly transferred his 31% stake in Groupe Arnault, a family firm that runs LVMH, in December 2011. At the time, that stake, according to France’s Libération newspaper, was worth 6.5 billion euros.
Reports stated that Pilinvest was set up in Belgium just as France prepared to introduce a 75 percent supertax, prompting prosecutors to look into his Belgian companies.
At the time, however, a spokesperson for Arnault, 68, insisted he was not trying to escape the French taxes, but attempting to preserve the company in case he died suddenly. Arnault ultimately withdrew his Belgian nationality request and said his frustrated efforts to acquire Belgian nationality were motivated not by tax concerns but a desire to tie up legal ownership issues in case of an untimely death.
A spokesman for Arnault’s LVMH further noted that Pilinvest was created in Belgium in 1999 and had operated as a holding company since then. “(Pilinvest) has always respected current legislation and has a tax agreement with Belgian authorities,” it added.
The now-closed investigation coincides somewhat closely with a still-pending investigation involving two LVMH Moët Hennessy Louis Vuitton executives in connection with a criminal investigation into influence-peddling, a type of corruption in which people use their connections with governments to gain favors or preferential treatment for a third party, usually in return for money. One of two unnamed executives taken into custody this past September is a former magistrate in charge of the Paris-based luxury conglomerate’s security. The other is said to be considered as “the most influential adviser” of Arnault.
That case centers on the criminal complaint that Hermès filed against LVMH in July 2012 in a Paris court, accusing the luxury conglomerate of insider trading, collusion and manipulating stock prices.