Introduction

Sega strives for full compliance with all tax statutory obligations and full disclosure to tax authorities. Our tax strategy sets out the core principles that govern the tax policy of the Sega Group entities in the United Kingdom. It aims to incorporate Sega`s values and code of conduct.

Sega Group regards the publication of this tax strategy as complying with its duty under paragraph 19(2) of Schedule 19 of the Finance Act 2016 in respect of the financial year ended 31 March 2024.

This strategy applies from the date of publication until it is superseded.

This document has been approved by the UK Senior Vice President Finance (SVP Finance) or an equivalent.

1. Approach to risk management and governance

Tax risks are managed in line with the overall group approach to tax and follow business procedures and internal controls. The Group operates an integrated approach to governance with the existence of management control, policies, procedures and training.

The UK group aims to manage our tax affairs so that all applicable tax laws and regulations are complied with, and to ensure the correct amount of tax is paid, at the right time, and all tax reporting and disclosure requirements are met.

Sega manages a variety of tax risks given its size and complexity, including compliance and reporting risk, operational risk and monitoring changes in tax landscape. Our internal control and risk management framework helps us manage these risks appropriately.

The SVP Finance (or an equivalent) owns and approves all tax policies and reports to the respective UK Boards, and the day-to-day responsibilities for UK taxes are handled by the SVP Finance with assistance from the UK Finance Director. All tax decisions are made at the appropriate level.

Sega employees are required to comply with all laws and regulations wherever we do business, and this applies to all UK companies.

2. The attitude of the Group towards tax planning

The Group aims to retain a low tax risk profile in the UK and does not engage in tax avoidance schemes that do not follow commercial reality or could be considered contrary to local tax legislation.

Where applicable, Sega will claim valid UK corporate tax reliefs for its activities, including those available for research and development and those specifically aimed at video games companies, where they are they are widely accepted through the relevant tax legislation such as those established by government to promote investment, employment and economic growth.

3. Tax risk in relation to UK taxation

The approach to tax risk in the UK is in line with the group approach to tax and takes a conservative approach to tax planning and tax risk and strives to keep tax risk at a low level. However, there is no pre-defined level of acceptable tax risk, and each tax risk is assessed on a case-by-case basis.

Due to the UK Group being part of a wider group with activities throughout the world, and the continuously changing tax landscape, there will be situations in which the tax treatment is uncertain, the impact on the Group is evaluated and resolved with an aim of maintaining low tax risk.

On matters that are complex or unclear, Sega will seek guidance from external tax advisors or engage with tax authorities to seek clarity around the interpretation.

4. Relationship with HMRC

The Group seeks to foster an open, professional and collaborative approach to its relationship with HMRC through regular meetings and communication in respect of developments in Sega`s business, current, future and retrospective tax risks, and interpretation of the law in relation to relevant taxes. HMRC is kept aware of significant transactions and changes in the business.

The Group aims to work in real-time across all areas of tax with HMRC, seeking to clarify matters of uncertainty at an early stage.

Where any inadvertent errors in submissions made to HMRC are identified, SEGA will make full disclosure to the relevant tax authority on a timely basis to resolve the matter.