China Unicom (Hong Kong) (0762.HK), a subsidiary of China United Network Communications (600050), received a tax refund of 98.28 million yuan from Spain’s tax authorities for the 2009-2011 period, reports Shanghai Securities News.

It was reported that the refunded taxes were for excess taxes paid when the company received dividends from Spanish telecom operator Telefónica.

According to the report, China Unicom has not confirmed reports of the tax refund.

China Unicom and Telefónica had invested $1 billion in each other in 2009. Following the completion of the investments, China Unicom held a 0.89 percent stake in Telefónica, before increasing its stake in the Spanish operator to 1.37 percent thereafter.

Telefónica has paid dividends four times to China Unicom through May 2011, with the taxes on the dividends totaling 210 million yuan.

China Unicom, headquartered in Beijing, enjoys a preferential tax rate according to the Sino-Spanish taxation agreement signed in 1990.

China Unicom posted investment returns of 480 million yuan in 2010, mainly from its investments in Telefónica and other investments. It paid corporate income tax of 975 million yuan for full year 2010.