MILAN — Italian eyewear giant Luxottica on Thursday confirmed a tax audit over some of its accounting practices, but insisted it follows universally accepted practices.
The audit concerns alleged irregularities in the use of a practice called transfer pricing, which is understood to be the price at which divisions of a company transact with each other. Transactions may include the trade of supplies or labor between departments.
Luxottica said it “has been consistently adopting and applying a fair and correct transfer pricing policy, totally compliant with the law and the most updated guidelines issued by the OECD [the Organization for Economic Co-operation and Development],” which the company described as “the undisputed leading authority for transfer pricing.”
Luxottica, which in addition to house brands such as Ray-Ban and Oakley, produces eyewear collections for brands including Burberry, Chanel, Ralph Lauren and Versace, said “the challenge by the Italian Revenue Service specifically concern[s] the ordinary export of products by the Italian manufacturing company Luxottica Srl to its trading affiliates located in all the main markets.”
The company underscored that these “are routine commercial transactions, i.e. the sales of products within the corporate group of Luxottica. These are not extraordinary transactions, nor transactions involving low-tax jurisdictions or otherwise aimed at shifting income abroad.”
It is understood that the Guardia di Finanza, an Italian police force under the authority of the national minister of economy and finance, and the Italian Revenue Service have been looking at Luxottica’s accounts to determine whether the company has evaded declaring income in Italy. A source said the evasion would revolve around an unfaithful tax declaration of more than 2 million euros, or $2.6 million at current exchange.
Following a request from prosecutors, the police have been visiting Luxottica’s headquarters and offices in the Italian town of Agordo, near Belluno.
“The Italian company Luxottica Srl sells its products to affiliates generally resident in OECD member countries and in any case in high-tax jurisdictions, so no tax benefit was sought in these transactions: It is not even conceivable to argue the existence of a transfer pricing practice aimed at an abusive intent and subject to sanctions,” contended the company.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast