Broadcom chipmaker defeated the israeli tax authority and will not pay NIS 150 million

Broadcom chipmaker defeated the israeli tax authority: Broadcom District Court received Broadcom's NIS 150 million tax assessment for its Dune acquisition deal. In the judgment, Tax Judge Dr. Samuel Bornstein rejected the tax authority's claim that the Dune acquisition by Broadcom Semiconductors Ltd. was an artificial transaction, and even required the tax authority to pay Broadcom legal fees of NIS 75,000.
For Broadcom, this is a "saving" of about NIS 150 million. The original tax authority requirement from the company, from 2009, was about NIS 100 million, and the amount accrued interest.
For the economy, this is a judgment with significant latitude implications in the exits - acquisition deals of Israeli companies by multinational groups. The ruling makes it clear that not every transaction that is perceived as artificial by the tax authority is in fact one, and that in today's exits, models of purchases that are different from those accepted by the tax authorities are acceptable, and not all of them will be considered a "business model change" that justifies a tax charge.
Dune is an Israeli high-tech company that has been involved in the production and marketing of branded components for broadband communications since its inception, and after a few years was acquired by the Broadcom World Group. After joining the Broadcom Group, and as a customary acquisition of startups by international groups, the Israeli Company has contracted with various Broadcom Group companies in R&D and marketing agreements as well as a license agreement regarding the use of the Company's intellectual property by the Broadcom Group.
In the assessments conducted by the assessment officer Kfar Saba to Broadcom, it was alleged that Israeli company was disintegrated from its assets as part of the transactions made, without paying taxes for its overseas assets. According to the tax authorities, the taxpayer has become an independent activity company, a company whose entire business of providing services to the international group has acquired it. As a result, the assessor's mole determined that Dune had separated from her activity, passed it on to others - thus generating a taxable capital gain.