Street Calls of the Week
Investing.com -- Shares of British online fashion retailer ASOS (LON:ASOS) fell more than 3% on Friday after the company said it is in discussions with German customs authorities over a legal dispute concerning import duty corrections for prior financial periods.
ASOS said it has been engaged in ongoing discussions and legal processes with the German customs authority following assessments relating to prior import duties.
The company said it is contesting the assessments and considers the maximum exposure to be immaterial, having reviewed more than 95% of the tens of thousands of customs declarations under scrutiny.
Based on this review, which the company said is compliant with World Trade Organisation customs valuation methods and supported by external legal counsel, ASOS estimates its additional liability at around €0.5 million ($585,900). It said it continues to follow the relevant legal processes.
The matter follows a Financial Times report that German tax authorities are seeking unpaid customs duties on shipments crossing the German border over several years.
ASOS had previously warned that annual revenue would likely fall short of market expectations due to weak consumer demand and that profit is expected at the lower end of its forecast range.
The retailer has been working to revive its fast-fashion appeal among shoppers in their 20s while cutting costs amid competition from Chinese rivals and trade pressures in the U.S.