On 29 September 2015, the Board of Directors approved the aspects of the Risk Control and Management Policy of the Red Eléctrica Group and its integration into the Group’s Comprehensive Risk Management Policy.
The Red Eléctrica Group has a Comprehensive Risk Management System that includes the relevant tax risks for the Group and the mechanisms for their mitigation, control and management.
Tax risks shall be understood as those that occur as a result of applying tax regulations, the interpretative complexity associated to them or the amendments to such regulations and the possible reputational impacts of the management of tax matters.
The action guidelines for the management of tax risks are the following:
The Red Eléctrica Group is committed to complying with tax legislation and its tax obligations in the countries in which it carries out its activities.
The Red Eléctrica Group is committed to complying with the provisions set out in the ‘OECD Guidelines for Multinational Enterprises’ regarding tax matters.
In the matters regarding transfer pricing, the Red Eléctrica Group acts in accordance with the principle of full competition.
The tax behaviour of the Red Eléctrica Group is coherent with the Base Erosion and Profit Shifting (BEPS) principles and actions, as it has not carried out transactions, acts or events that could lead to double deduction of expenses, double tax benefit utilisation, double-loss utilisation, double non-taxation, nor has used hybrid instruments or entities.
The Group also has a specific Internal Control Over Financial Reporting (ICFR) System, which includes tax data and processes, as well as the associated control mechanisms, based on the COSO (Committee of Sponsoring Organisations of the Treadway Commission) methodology. These processes and systems are systematically subject to internal and external audits.
The Red Eléctrica Group has various mechanisms in place to prevent illicit transactions, money laundering and concealment of assets. These include the Code of Ethics, the Supplier Code of Conduct, the Corporate Crime Prevention System Guide and the Guide for the Prevention of Corruption: Zero Tolerance, which are available to Red Eléctrica Group employees, its suppliers and the various stakeholder groups.
In the same way, the Red Eléctrica Group carries out awareness and training activities in an ongoing manner to make its staff/members more familiar with the aforementioned documents.
The section "Tax status" of the Annual Accounts report includes the years open to tax inspection, the inspection verification actions and the pending tax-related proceedings of the Group.