Investigators searched the offices of streaming giant Netflix in France and the Netherlands on Tuesday, as prosecutors opened an investigation into suspected financial fraud, judicial officials said. 

The search is looking into "covering up serious tax fraud and off-the-books work" and is part of a probe opened in November 2022, a source told AFP news agency.

In Paris, the investigation was opened by the Parquet National Financier (PNF), which often probes big international companies. The raid was carried out by investigators specializing in financial crime and corruption.

"We are cooperating with the authorities in France, where Netflix is a significant contributor to the local economy, and we comply with the tax laws and regulations in all the countries in which we operate," a Netflix spokesperson said in a statement.

A raid was carried out simultaneously in Amsterdam, where the company's European headquarters are based. 

Emma Bosma, a spokesperson for the National Office for Serious Fraud, Environmental Crime and Asset Confiscation, said the raid was carried out at the request of French authorities.

"Cooperation between the French and Dutch authorities has been underway for many months as part of these proceedings," the French source told Reuters. 

What prompted the investigation?

The reason behind the investigation has not yet been made clear. European tax authorities often have difficulties with large tech companies with online services across borders.

The PNF has not shared the details of its investigation.

In France, the launch of such a probe does not imply criminal charges and the case might not necessarily go to trial at all.

French news website had reported last year that tax authorities were suspicious of Netflix Services France had such a low turnover despite a high number of paying customers.

The French subsidiary paid less than €1 million ($1.09 million) in corporate taxes, by involving a separate unit registered in the Netherlands, La Lettre had reported. This practice was stopped in 2021.

Netflix opened its office in Paris in 2020 and employs around 40 people. 

Netflix had previously run into issues with Italian tax authorities which were resolved by payment of € 55.8 million in 2022.

tg/wmr (AFP, AP, Reuters)