KARIYA (Japan) - DENSO Corporation received a supplementary tax assessment notice from the Nagoya Regional Taxation Bureau (NRTB) requesting the aggregate taxes on the profits of its Singapore subsidiary for the fiscal years ending March 2008 and March 2009. The notice stated DENSO's Singapore subsidiary did not satisfy the tax haven exclusion requirements, therefore recognizing its income as DENSO income. The supplementary income assessment was approximately 11.4 billion yen, and the additional tax payment was approximately 1.2 billion yen, including the local government taxes. DENSO made the tax payments to the NRTB on June 29, 2010.

DENSO disagrees with the NRTB's assessment and is confident the Singapore subsidiary satisfies the tax haven exclusion requirements. Also, and the company firmly believes it appropriately reported tax information to the NRTB.

DENSO believes that the Singapore subsidiary satisfies the tax haven exclusion requirements because since 1990, when DENSO first entered Singapore , the subsidiary has provided regional management services to DENSO's subsidiaries in the Asia and Oceania region, and most employees engage in these services. The Singapore subsidiary is also equipped with the facilities needed for these operations.

DENSO believes the supplementary tax assessment is unfair and plans to lodge and objection to the NRTB's assessment.

As a result of the assessment, DENSO does not expect any significant impact on its consolidated financial results for the year ending March 31, 2011.