On 12 March 2026, the Court in Viborg acquitted my client, Genan Holding A/S, of a charge concerning the late submission of transfer pricing documentation.
The company chose to pursue the case at its own expense because it considered the matter to be clearly unreasonable – and because I assessed that there was a strong case supported by substantial legal arguments.
Only simple negligence – not gross negligence
I argued that the matter involved only simple negligence due to an excusable error/misunderstanding regarding the deadline. The background for this included, among other things:
The Court assumed that the transfer pricing documentation had, objectively speaking, been submitted after the system‑indicated deadline – but found that Genan Holding had not acted with gross negligence, precisely because the company had a legitimate expectation of identical deadlines between jointly taxed companies.
Transfer pricing penalties are not a matter of strict liability, and the general conditions for criminal liability and penalty assessment apply.
Skattestyrelsen had maintained penalty liability at the fixed base amount of DKK 125,000 throughout the entire process and rejected all our arguments concerning simple negligence, voluntary self-disclosure, and mitigation.
The judgment shows very clearly – as I also emphasised in court – that transfer pricing penalty liability is not based on strict liability. There must be clear proof of intent or gross negligence, and these general criminal law requirements apply fully, also in transfer pricing cases.
I emphasised, among other things, that even if the matter did not amount to simple negligence, it nevertheless constituted voluntary self‑disclosure, which according to established practice results in exemption from penalties. It was, in fact, Genan Holding A/S itself that brought the matter to the attention of the authorities.
I also emphasised that it was clearly a mitigating factor that the company had acted as it did and had itself remedied the “damage”.
The case demonstrates that the assessment of penalties – even in transfer pricing criminal cases – must follow general criminal law principles, including that mitigating circumstances are also relevant, as the judges during the hearing took the time to indicate that all of our arguments, both regarding voluntary self‑disclosure and mitigation, were pertinent.
The Court, however, found that the case could already be decided on the basis that the conduct amounted only to simple negligence – and that a penalty could therefore not be imposed.
Changes in the authorities’ guidance prior to the court hearing
Before the court hearing, however, I had noted that the Danish Tax Agency, which throughout the process strongly disagreed with my argument on voluntary self‑disclosure, had changed the very wording of the Legal Guidance on this specific point of dispute.
The change made to the Legal Guidance, without any particular notice or announcement, is in my assessment highly problematic, as the concept and consequences of voluntary self‑disclosure within tax and duty criminal law are governed by a very specific and long‑standing established practice, which the Danish Tax Agency cannot simply change “with the stroke of a pen” – and certainly not in a more restrictive direction. It must be for the courts to determine whether the practice should be interpreted in such a manner.
We continue to fight for justice on behalf of our clients and are pleased to see justice prevail.
Reach out if you or your company are facing a tax or duty‑related criminal case that you believe is completely unreasonable — we are ready to take up the fight!
Bachmann/Partners Law Firm provides specialised tax and VAT advice in relation to influencers. If you have any questions, please feel free to contact:
Ann Rask Vang på tlf. 20947821 / ava@bachmann-partners.dk
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