February 20, 2020 / 11:13 PM / 3 months ago

UPDATE 1-Rio Tinto seeks international arbitration on tax dispute with Mongolia

(Adds details on project, tax dispute)

Feb 21 (Reuters) - Global Miner Rio Tinto said on Friday its Mongolian copper unit had begun an international arbitration process, seeking to resolve a dispute with the local tax authority.

Rio Tinto is already stuck in renegotiations over terms of the agreement underpinning the Oyu Tolgoi copper mine project, as local lawmakers contend that financial gains from the project are not being evenly shared with Mongolia.

The project is Mongolia’s biggest foreign investment and has been subject to lengthy delays and ballooning costs, leaving the country’s lawmakers impatient for income. Meanwhile, Rio Tinto says it has invested billions.

The present dispute relates to taxes paid by Oyu Tolgoi LLC, Rio’s unit, between 2013 and 2015.

“We have worked diligently with the government and tax office representatives in Mongolia to find a mutually acceptable settlement and came to the conclusion that arbitration is the best way forward to resolve this issue,” Rio said in a statement.

The miner said Oyu Tolgoi received a tax assessment for about $155 million on January 16, 2018 from the local tax authority, relating to an audit on taxes already imposed and paid by the unit between 2013 and 2015.

Rio claims Oyu Tolgoi paid an amount of $4.8 million in January 2018 to settle the unpaid taxes, fines and penalties for items it accepted.

Turquoise Hill Resources, majority owned by the mining giant, has a 66% stake in the multi-billion-dollar project and the Mongolian state owns 34%.

“Turquoise Hill remains of the opinion that Oyu Tolgoi has paid all taxes and charges required to be paid under the investment agreement... and Mongolian law,” the company said in a separate statement.

Reporting by Rashmi Ashok in Bengaluru; Editing by Krishna Chandra Eluri

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below