Norway's Whilhelmsen moving shipping unit to Malta

OSLO, June 18 Wed Jun 18, 2008 3:07pm BST

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OSLO, June 18 (Reuters) - Norwegian shipping and global maritime industry group Wilh. Whilhelmsen (WWI.OL) will move its shipping activities to Malta due to "uncertainty" over a new tonnage tax regime in Norway, it said on Wednesday.

The Labour-led government last year presented a plan for a system akin to the tonnage tax in other European countries under which taxes would be imposed on undistributed profits retained by companies.

The proposal would force the shipping industry to pay two-thirds of about 21 billion Norwegian crowns ($4.04 billion) in back tax and many companies have said the changes would hit profits hard.

Shipping companies have called it a betrayal of a 1996 deal, meant to keep them competitive and under the Norwegian flag.

"The board of Wilh. Wilhelmsen (WW) has today chosen not to enter into the new Norwegian tonnage tax regime for the majority of its Norway-based shipping activities," the company said in a statement.

"The basis for the decision is uncertainty related to the predictability and sustainability of the new tonnage tax regime," it said.

The changes were aimed at making Norwegian shipping rules more like those in the European Union, but industry groups have said the move might force some to register in tax havens such as Bermuda or Cyprus.

Wilh. Wilhelmsen said that although it was moving its shipping activities to Malta, it had no "current plans" to move its head office from its current location outside Oslo.

Some other shipping companies, such as tanker group Frontline (FRO.OL), have already moved their headquarters to tax havens to escape the Norwegian tax authorities. (Reporting by Aasa Christine Stoltz; Editing by Quentin Bryar)

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