ICT Legal Consultants in Latin America
PERU -- Satellite Regulations -- Abr-2018
Supreme Court rules that satellite capacity provided in-country by non-domiciled satellite operators is a commercial activity subject to income-tax withholding.
Date of Ruling: 27-September-2017
Date of Publishing and/or Notification: 26-April-2018
Summary of Decision: tax payers [in this particular case Telefonica del Perú] who qualify as withholding agents and conduct business with non-domiciled entities whose goods [including intangible such as satellite capacity] be utilized in country for its commercial operations, shall withhold income-tax to the relevant non-domiciled entity [in the ruling are mentioned Satmex, Intelsat and Panamsat).
Relevant Parties: Telefonica del Perú Sociedad Anonima Abierta vs. Superintendencia Nacional de Aduanas y Aministración Tributaria (SUNAT)
Following are mentioned some of the relevant regulatory and technical elements taken into consideration by the Court to decide:
· The controversy is concentrated in certain withholding taxes that SUNAT considered that Telefonica del Peru -- as withholding agent -- did not take from Satmex, Panamsat and Intelsat since 2002. The Court analyzes some of the service contracts entered by Telefonica del Peru with the above-mentioned satellite operators and discusses some of the provisions therein to rule on the matter.
· Declares expressly Telefonica del Peru as withholding agent and the satellite operators as subject to income-tax withholding from the former.
· The ruling discusses in some detail what a communication via satellite is, based on the documents submitted by other interested parties (a University and an Association of Private Operators) and concludes that a satellite is part of the Telecommunications system needed to complete a communication which uses the national spectrum and therefore the satellite operators benefit from that limited resource.
· Furthermore, the Court concludes that a satellite system is a collection of tangible and intangible resources -- including the space segment-- and that the transponders built-in the satellite “detect and amplify the signals required for the transmissions”, thus is not a passive element of the communications process, but rather the provision of a complex [Telecommunications] service.
· Declares it the satellite capacity as an intangible good subject to assignment or any other contractual form i.e. a commercial element used in-country by the satellite operator to obtain an economic benefit.
· In various parts of the ruling, the Court notes that the satellite operator uses the national spectrum to obtain an economic benefit from a domestic source of income.
certain terms and conditions.