Tax strategy

INFORMATION ON THE IMPLEMENTED TAX STRATEGY

FALKEN TRADE limited liability company

Prepared: 20 December 2024

[Approved by: the Company's Management Board]

Terms and abbreviations

For this document, the following terms have the meanings set out below:

Abbreviation	Description
2023	The tax year beginning on 1 January 2023 and ending on 31 December 2023.
Company	Falken Trade Sp. z o.o.

INTRODUCTION

This document presents the implementation of Falken Trade Sp. z o.o.'s tax strategy in 2023. As a corporate income tax payer with revenue exceeding
EUR 50 million in the tax year ending on 31 December 2023, the Company is required to prepare and publish information on its implemented tax strategy for that financial/tax year.

This information was prepared pursuant to Article 27c of the Corporate Income Tax Act of 15 February 1992 (consolidated text: Journal of Laws 2021, item 1800, as amended).

Falken Trade Sp. z o.o. is a leading importer and distributor of functional additives
for food and food raw materials in Poland. The Company specialises in international distribution, working with manufacturers in China, India, Indonesia, Vietnam and Latin America. Alongside importing and distributing ingredients, it advises customers on changing market trends.

Company name	Falken Trade Sp. z o.o.
Registered office	ul. Mariana Rejewskiego 5, 10-683 Olsztyn
Identification details	KRS number: 0000973988 NIP tax number: 7393752343 REGON number: 280415340
Share capital	PLN 200,000.00
Date of entry in the register of entrepreneurs of the National Court Register	31 July 2009; 1 June 2022 (registration of the change in legal form from sp. z o.o. sp.k. to sp. z o.o.)
Employees at the end of 2023	22 employees

Processes and procedures for managing tax obligations and ensuring their correct performance (Article 27c(2)(1)(a) of the CIT Act)

To manage its tax obligations properly, in 2023 the Company based its practices on tax legislation
and generally accepted good practice in this area.

The Company applied appropriate processes and procedures to manage and correctly fulfil its statutory tax obligations. These processes
and procedures were developed and implemented with regard to its organisational structure, the nature of its business and industry, and consultation with its external accounting firm.

By setting appropriate objectives and measures, the Company sought to continually improve tax management, settlement and control processes, enabling correct and timely compliance.

The processes and procedures provided control over tax settlements and supported compliance with tax legislation and reporting requirements, while helping manage potential risks
in these areas.

Tax settlements

Tax settlement duties were performed by qualified
accounting and tax specialists: the external accounting firm used since the Company's establishment and an additional statutory auditor's practice,
working with the Company's business departments. The Company also used specialist independent legal and advisory services to ensure process stability and compliance. For key tax matters it applied its tax strategy and generally accepted good practice.

Cooperation with business departments

Cooperation between the accounting firm and the Company's business departments followed an established operating model according to current needs. Business representatives supplied the information required for tax compliance and settlements without undue delay, limiting disruption to tax processes.

Tax risk management and internal controls

The Company identified tax risks through appropriate controls and monitoring, then sought to eliminate or limit them. Primarily with support from its accounting firm
and legal advisers, it analysed tax, financial and accounting processes for risks to their performance and maintained guidance on action
where such risks arose. Risk levels were assessed using internal expertise and support from professional advisory firms.

Data and information management

IT tools, particularly the accounting system, supported complete and accurate recording of Company data,
maintaining data integrity and automating work. Tools used for tax settlements enabled
correct preparation and completion of tax returns and financial statements
and fulfilment of other statutory tax obligations. They were updated and adapted to the Company's needs. The Company emphasised
proper management of tax documentation, information and data, with appropriate safeguards against unauthorised use. Data and information were archived regularly.

Company employees

From the start of employment, every employee must comply with legislation relevant to their responsibilities and observe the highest ethical standards.

Voluntary cooperation with the National Revenue Administration (Article 27c(2)(1)(b) of the CIT Act)

 

In 2023, the Company did not use voluntary forms of cooperation with the National Revenue Administration.

 

Tax obligations fulfilled in the Republic of Poland (Article 27c(2)(2) of the CIT Act)

In 2023, the Company focused on legal compliance and reliable reporting, including collecting tax documentation, submitting returns, information and forms on time, and meeting tax payment deadlines. It sought to ensure that information accurately reflected the facts and was clear, current
and complete. It also pursued transparent tax settlements and open cooperation with the tax authorities.

Tax decisions were based on a reasonable interpretation of legislation and professional, diligent assessment, including external advisers' opinions.

The Company used professional advisory and audit firms to support compliance, including analysis of significant tax issues and bookkeeping. Different providers ensured comprehensive and impartial opinions and positions.

The Company continually monitored legislative changes and developments in tax practice relevant to its activities.

The Company actively monitored tax legislation for legally available
and permitted exemptions, reliefs and preferences it could use, particularly concerning technological innovation, research
and development and participation in international trade fairs.

The Company fulfilled tax obligations across all areas required by its activities. The main taxes were corporate income tax (CIT), personal income tax (PIT) and value added tax (VAT).

Corporate income tax settlement information, particularly taxable revenue, deductible costs, taxable income
and tax due, is published regularly on the Ministry of Finance website in accordance with applicable legislation.[1].

The Company also fulfilled obligations and payments for social insurance
and health insurance contributions on employee remuneration (ZUS), and contributions
to Employee Capital Plans (PPK). Its activities also involved specific requirements concerning imports into the EU, waste disposal fees and packaging waste recycling fees,
as well as applicable stamp duties.

Number of tax arrangement reports submitted to the Head of the National Revenue Administration, by tax concerned (Article 27c(2)(2) of the CIT Act)

To meet mandatory disclosure obligations correctly and on time, the Company regularly consulted independent legal and accounting advisers to identify potentially reportable tax arrangements and report them where required. It assessed whether particular events triggered a reporting obligation.

As no reportable tax arrangements were identified in 2023, the Company did not submit any such information to the Head of the National Revenue Administration under Article 27c(2)(2) of the CIT Act during that period.

Transactions with related parties (Article

27c(2)(3)(a) of the

CIT Act)

In 2023, the Company did not enter into transactions whose value exceeded 5% of total balance-sheet assets determined from its latest approved financial statements under accounting regulations.

Planned or undertaken restructuring that could affect the tax liabilities of the Company or related parties (Article 27c(2)(3)(b) of the CIT Act)

In 2023, the Company did not undertake restructuring that could affect
its tax liabilities or those of related parties.

At the time of this report, no such measures were planned for 2024 either.

Tax settlements in territories or countries applying harmful tax competition (Article 27c(2)(5) of the CIT Act)

The Company did not make tax settlements in territories or countries applying harmful tax competition listed in regulations issued under Article 11j(2), Article 23v(2) of the Personal Income Tax Act of 26 July 1991 (Journal of Laws 2022, item 2647, as amended), or the ministerial notice issued under Article 86a §10 of the Tax Ordinance Act of 29 August 1997 (Journal of Laws 2022, item 2651, as amended).

Applications submitted by the Company (Article 27c(2)(4) of the CIT Act)

 

In 2023, the Company did not apply for a general tax ruling, binding rate information or binding excise information.

In 2023, the Company received a response to its 2022 application for an individual corporate income tax ruling.

[1] Individual CIT taxpayer data — Ministry of Finance — Gov.pl