Transocean caught up in Norway’s biggest ever tax scandal

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Transocean caught up in Norway’s biggest ever tax scandal

transocean.jpg

The charge is Norway’s largest
Source:www.deepwater.com

Transocean, the world's largest offshore drilling company, has been hit with accusations that it dodged tax on NKr10 billion ($1.8 billion) of revenue.

Okokrim, the Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime, states in its indictment that the Transocean parent company changed its country of registration from the US to the Cayman Islands in 1999.

The Cayman Islands has long been regarded as a jurisdiction which companies and individuals can use to avoid tax and keep their activities secret.

Ten years later, the ownership was transferred to a newly formed company registered in Switzerland.

In 1997, Transocean's Norwegian company, TASA, sold six of its rigs to group companies registered in the Cayman Islands, and the remaining six in 2001.

"From 1996/97, Transocean Group's master plan was to concentrate the ownership of the Group's Norwegian rigs in companies registered in the Cayman Islands," Okokrim's indictment states, arguing that the plan was tax motivated.

One of the indictment's claims is that one rig, Polar Pioneer, which was owned by a Norwegian Transocean company and operated almost continuously on the Norwegian continental shelf, was towed outside the country's territorial waters for eight hours and fifteen minutes in May 1999, during which time it was sold through a number of group companies to Transocean International Drilling, registered in the Cayman Islands.

"On May 21 May 1999, the rig was sold while the rig was located outside Norway and Norwegian tax jurisdiction," an attachment to Transocean Offshore Norway's 1999 tax return recorded. "The sale is thus not subject to Norwegian taxation."

Okokrim asserts that the information the company provided was misleading and that the failure to provide details of the true legal status of the rig could have resulted in NKr 689 million of tax evasion.

The company might have to pay as much as NKr5 billion including interest, if the charges stick.

Transocean rejects all of Okokrim's accusations and states that it intends to clear its name in court, which will result in Norway's biggest ever tax evasion case.

Two tax advisers from Ernst & Young, Einar Brask and Klaus Klausen, are also named by Okokrim for allegedly aiding and abetting in "providing incorrect or incomplete information".

Brask refused to comment on the allegations.

more across site & shared bottom lb ros

More from across our site

The US president also unveiled a new 50% levy on copper imports; in other news, a UK wealth tax proposal has been criticised by the Institute for Fiscal Studies
Wim Wuyts, who had been head of the specialist tax network since 2017, is moving on to a new role with WTS’s Belgian member firm
MNEs are increasingly using algorithmic tools in TP. Sahasranshu Dash argues that data ethics should therefore plug directly into the TP design process
The Institute of Chartered Accountants in England and Wales also queried whether HMRC resources could be better spent scrutinising larger entities
Grant Thornton’s Austria tax head likens his practice to an escape room, shares his football coaching ambitions, and explains why tax is cool
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 EMEA Tax Awards
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 Asia-Pacific Tax Awards
The fates of pillars one and two hang in the balance after the US successfully threw its weight around in G7 and Canadian negotiations
Rafael Tena tells ITR about the ‘crazy’ Mexican market, ditching the hourly rate, and refusing to grow his fledgling firm in an ‘unstructured way’
It should be easy for advisers to be transparent about costs, Brown Rudnick partner Matthew Sharp said in response to exclusive ITR in-house data
Gift this article