Showa Denko Group’s Tax Code of Conduct

We at the Showa Denko Group will provide products and services that are useful and safe and exceed our customers' expectations, thereby enhancing the value of the Group, giving satisfaction to our shareholders, and contributing to the sound growth of international society as a responsible corporate citizen.

Showa Denko Group, under its vision as described above, has strived to realize “a company contributing to the sound growth of society” that contributes toward creating a society where affluence and sustainability are harmonized.

We set the tax code of conduct as follows and will contribute to society’s growth through appropriate tax payment.

1. Basic philosophy

Showa Denko Group recognizes that the contribution to society’s growth through the tax payment in all countries and regions where we conduct our business activities is one of the social responsibilities that must be taken as an enterprise.

2. Compliance

Showa Denko Group will comply with the laws, regulations, rules and provisions of tax treaties that are applicable in each country and region where we conduct our business activities, and will fulfill the tax payment duties as required in each country referring to the OECD’s model tax convention, transfer pricing guidelines and the like.

3. Internal system for compliance

Showa Denko Group allocates the appropriate human resources to the tax administration division to establish the internal system to accurately handle the tax issues that occur in day-to-day operations. Through continuous training and the like, we will make an effort to maintain and improve tax compliance awareness and cope with the newly implemented or amended tax system and regulations in each country and region where we conduct our business activities promptly and accurately.

4. Relationship with the tax authority

Showa Denko Group will make an effort to provide the accurate information as required by the tax authority in each country and region where we conduct our business activities.

5. Appropriate management of the transfer pricing taxation

Showa Denko Group will make an effort to determine the transfer prices that enable to allocate the profits equivalent to the one to be allocated to each party to the foreign controlled transactions conducted based on the arm’s length principle in the light of the functions performed, risks assumed, assets owned and level of the contribution to the profit of each party of the foreign controlled transactions. Applying the advance pricing agreement and the like, we will make an effort to build consensus with the tax authorities to reduce the tax risk and pay tax accurately.

6. Scope of application of the tax code of conduct

This tax code of conduct shall apply to the transactions conducted by Showa Denko Group.

7. Nature of the tax code of conduct

This code of conduct complements the Showa Denko Group's vision and code of conduct, and is a declaration that firmly “promises” our stakeholders.

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