The Supreme Court will hear this week a tax case and a bid for state immunity.
Over two days, 4 and 5 November 2024, Lord Lloyd-Jones, Lord Briggs, Lord Hamblen, Lord Leggatt, and Lady Rose will hear Royal Bank of Canada v Commissioners for His Majesty’s Revenue and Customs. The issue presented is whether RBC, based in Canada, is liable for UK corporation tax on royalty payments it received from a North Sea oil field operator. The payments were originally agreed between a RBC borrower and BP, and were triggered when the price per barrel of oil exceeded US$20. RBC acquired the right to receive the payments in the borrower’s receivership, and the payment obligation was assumed by the current holder of the oil field rights. When HMRC discovered the payments, it assessed RBC for around £19 million in tax, before interest. The First-tier and Upper Tribunals found for HMRC, but the Court of Appeal allowed RBC’s appeal and set aside the assessments. The Supreme Court is likely to deal with the interpretation of the 1978 Canada-UK Double Taxation Convention and the special domestic rules in the taxation of oil-related activities.
On 6 November 2024, the Court will hear The Royal Embassy of Saudi Arabia (Cultural Bureau) v Constantine. Ms Constantine worked at the Embassy. When she brought a claim in the Employment Tribunal alleging discrimination and harassment, the Embassy argued it was immune from suit under the State Immunity Act 1978. The employment judge rejected the immunity claim. The Court of Appeal granted permission to appeal, but before the matter was heard the Embassy’s solicitors applied for and received an order to come off record for non-payment of fees. At the appeal hearing, no one appeared for the Embassy and the Court dismissed on that basis. The Embassy now appeals to the Supreme Court against the Court of Appeal’s decision to dismiss for non-appearance instead of considering the state immunity claim, and the original immunity decision by the employment judge. The scheduled panel is Lord Lloyd-Jones, Lord Briggs, Lord Hamblen, Lord Leggatt, and Lord Burnett.
