Worldline - 2020 Universal Registration Document

F

RISK ANALYSIS Legal Proceedings

Tax claims F.3.3

The Group is involved in a number of routine tax claims, audits and litigations. Such claims are usually solved through administrative non-contentious proceedings. These claims have no material effect on the financial condition or results the Company or the Group and are provisioned appropriately.

As of December 31, 2020 € 12.9 million were recorded by the Group concerning tax litigation.

Other legal proceedings F.3.4

Argentina Investigations The Group offers contactless “smart card” fare collection schemes for multi-modal transit platforms that, among other things, allow passengers to use travel cards, payment cards and mobile wallets to “touch in” and “touch out” at the start and finish of their journeys and automatically calculate and process fare prices. The Group currently operates several contactless smartcard schemes for municipal transportation networks in Argentina through its subsidiary Atos IT Solutions and Services SA (“Worldline Argentina”), including for the cities of Cordoba, Mendoza, Salta, Tucuman and La Rioja, as well as for the SUBE system in Buenos Aires. This business was originally started and conducted by Siemens and was included in the businesses acquired by Atos in mid-2011. In respect of some of the fare collection schemes that Worldline Argentina operates, customers purchase or recharge cards with cash, which is then collected from the various points of sale and deposited in accounts of the municipalities with which Worldline Argentina has contracted to operate the schemes. Worldline Argentina outsources the cash collection and transportation function to subcontractors. Between mid-2011 and September 2012, Worldline Argentina subcontracted such services with respect to its fare collection scheme in Cordoba (the “Red Bus” scheme) to a local association of companies, UTE Ribelux Cordubensis, which included CBI Cordubensis SA (“CBI”). In September 2012, Worldline Argentina replaced CBI with another subcontractor, Logistica y Distribucion Cuyo Card SA (“LyD”), due to dissatisfaction with CBI’s service and in particular the inclusion in the funds flow of third party cheques in lieu of cash collected. In late 2013, the Group’s management became aware of potential irregularities in connection with the Red Bus scheme upon receipt of anonymous e-mails, apparently from an internal source, which contained allegations about suspicious and possibly illicit behavior on the part of LyD. The Group promptly commenced an internal investigation into the allegations. In early 2014, the Group’s internal investigation was expanded following the emergence of reports in the Argentina press relaying further allegations of irregularities and possible illegal activities, including money laundering and corruption, in the functioning of the Red Bus scheme. On March 28, 2014, Worldline Argentina received a request from the Office of the Prosecutor for Economic Crime and Money Laundering (PROCELAC) of the Argentine National Public Prosecutor’s Office to provide specified information and documentation relating to the Red Bus scheme. Worldline

Argentina promptly provided the information requested. PROCELAC has since then opened a case file to investigate further the possible involvement of various parties in acts of “criminal association” ( asociación ilícita ) and tax evasion. The Group’s internal investigation into this matter, which has been conducted through its Internal Audit and Finance departments assisted by external advisors, has not found any proof that Worldline Argentina or any of its employees violated Argentina anti-corruption laws. On June 30, 2017 the Chief Executive Officer and the Director of operations of Worldline Agentina were formally accused by the judge of the Tribunal of Cordoba of money laundering. On July 5, 2017, they filed an appeal against this decision and asked the Appeal Court of Cordoba to dismiss the charges. Should the Appeal Court not dismiss the charges as requested, the criminal proceeding will continue. There’s no risk of involvement for the Company given the current stage of the case. Tax assessment procedures in Brazil The tax assessment procedures in respect of a Brazilian subsidiary (Ingenico do Brasil Ltda) are still in progress. They relate to the ICMS tax, and the sum in question amounted to approximately € 50 million as of December 31, 2020 (covering principal, interest and penalties from 2004 to 2010). The “Tax War” pitting Brazilian states against one another affected Ingenico as well as a large number of foreign and domestic companies. The tax authorities of the state of São Paulo have contested the deduction by Ingenico do Brasil of a portion of the ICMS tax on the sales invoices of one of its suppliers (Jabil do Brasil Indústria Eletroeletrônica Ltda) on the grounds that the state of Minas Gerais, in which the supplier operates, had granted the supplier a tax incentive which was not duly approved by the Brazilian National Council for Treasury Policy (“CONFAZ”), therefore violating federal tax law. In June 2019, the taxation authority of the state of São Paulo issued a resolution on the measures that taxpayers must take to benefit from an amnesty. In July 2019, Ingenico do Brasil presented a request which suspended the administrative proceedings until the tax authorities conclude its analysis on the recognition of the amnesty. As of February 2021, Ingenico do Brasil is awaiting analysis of its request and the recognition of the amnesty, and considers success in this case as probable. Based on an analysis of the risks involved and on the criteria set out in IAS 37, no provision has been recognized in the consolidated financial statements as at December 31, 2020.

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Universal Registration Document 2020