Nokia is reported to have offered to pay at least €355 million to India’s tax authorities in order to enable the transfer of a factory in the country to Microsoft, as part of the sale of the Finnish company’s Devices & Services unit to the US giant.

According to Bloomberg, Nokia is willing to deposit at least €270 million on top of an already announced €85 million, to allow it to transfer the plant in Chennai. The assets were frozen in September because of a tax dispute, at around the same time the deal with Microsoft was revealed.

The report also said that the plant may not transfer to Microsoft when the deal completes early in 2014 if the freeze on the Indian assets continues past the end of this week. It was suggested that this means that Nokia will need to find another buyer for the unneeded asset.

Reuters noted that the combined payment would exceed the disputed income tax sum demanded by the Indian authorities. It also said that Nokia hopes to retrieve the payments if the dispute is resolved in its favour.

Under the terms of the asset freeze, the facility in Chennai is able to operate normally, but a change of ownership is prevented. Nokia could continue to operate the factory as a contract supplier to Microsoft, although it is believed that the companies do not favour this plan.

While Nokia has already picked up clearance from the EU and US authorities for their planned merger, the company noted that it still needs authority in six more markets, including China. At this point, it identified India as one market where regulatory clearance has already been received – indicating the tax dispute may be little more than a hiccough for the bigger deal.