Activision Blizzard’s Bermudian Billions

by | Aug 4, 2019

Activision Blizzard, the publisher of hit games Call of Duty, World of Warcraft, and Candy Crush, moved €5bn to companies in Bermuda and Barbados between 2013-2017.

The report World of Taxcraft details how the corporate structure of Activision Blizzard, which includes subsidiaries in Bermuda, Barbados, Malta and Ireland, manages to move cash into tax havens.

The offshore structure has attracted the attention of tax authorities around the world, which are currently in a series of disputes with the company. Overall the company is facing tax demands of over $1bn from tax authorities in France and Sweden, demands that the company says it will vigorously contest. In addition, the company has set aside £8.5m in relation to an investigation by the UK tax authority, HMRC. The company has also recently settled a dispute with the US authorities for $345m.

The company says it is now seeking to engage pro-actively with tax authorities to ensure it pays the right amount of tax.

The report also looks at the UK government’s attempts to deal with tax avoidance schemes that use royalty payments to move money into tax havens. Activision Blizzard paid royalties of €5bn to companies in Bermuda and Barbados between 2013-2017.

The report concludes that companies will continue to be able to use these kinds of schemes because the UK government’s proposed rules to deal with this kind of avoidance will not apply to transactions made with a number of tax haven jurisdictions, including Barbados.

Speaking on the publication of the report, George Turner, Director of TaxWatch said:

“With the revelation that Activision Blizzard is currently under investigation by a number of tax authorities around the world, and facing a potential liability of more than $1bn in taxes and penalties, the company is taking tax avoidance in the video games industry to the next level.

“I expect many players of Candy Crush would be outraged to find that the payments they make though the game are sent to a company in Malta, even though King, the Activision company behind the game, is managed from London. Players of the hit mobile game are seeking a little bit of light relief from their daily grind. The last thing they want to do is to be a participant in Activision’s tax games.”

“Our research has found that between 2013 and 2017, Activision Blizzard paid €5bn in royalties generated from games such as World of Warcraft and Call of Duty to companies based in Bermuda and Barbados. This shifting of profits using royalty payments to tax haven companies is the same scheme used by Google, which has been heavily criticised by MPs.

“The UK Government is aware that this kind of structure is an abuse of the UK tax system, and introduced new legislation in 2018 to make the UK sourced element of these royalty payments subject to income tax in the UK. However, for some unknown reason the government have excluded payments made to a number of tax havens, including Barbados, ensuring that the new rules will be almost completely ineffective.

“The government needs to change the rules to close down the loopholes they left in the original legislation, and end these royalty based tax avoidance schemes once and for all.”

This research has been featured in The Sunday Times, along with, among other video game industry publications.

Related stories

Press contacts

For all media enquiries about TaxWatch or to be added to our media email list, please contact:

Claire Aston, TaxWatch Director

+44 7494 922661


Enter your email address to subscribe to our newsletter.

Please wait...

Thank you - please click on the link in the email we've just sent to confirm your subscription.