Did LN Know About Croatian Tax Debt?

LN acquired a minority stake – believed to be about 25 percent – in its Croatian partner for an undisclosed sum at the beginning of 2012, although the country’s public records showed the tax authority has been chasing two of Adria’s forerunners for more than 20 million Croatian kunas since 2009.

The company had formerly traded under the name of Lupa, and Croatian tax authorities are pursuing Lupa and AM Lupa Promotion for the outstanding money.

At least some of the debt is understood to relate to a U2 show the two companies promoted in Zagreb in 2009.

A year later and about a year before it did the LN deal, Lupa changed its name to Adria. Live Nation’s European president of concerts, John Reid, says as a matter of policy the company “does not comment on the tax affairs of its partners or those of partly owned assets.”

“Any questions regarding such affairs, particularly regarding periods prior to LNE’s investments, should be put to the tax authorities in the countries concerned,” he said.

Adria chief Vlado Ivankovic said his company has since won a court case against the tax authority regarding the outstanding amount and the debt has been wiped.

He says he’s waiting to hear if the taxmen will appeal the verdict. It was unclear the date of the case or in which court it was held.

On Aug. 26, the Croatian tax authority website was still showing Lupa debts of 20.4 million HRK ($3.4 million).