23.4 C
Mining News

Canadian Mining Firm Gabriel Resources Challenging ‘Retaliatory’ Romanian VAT Claim

Canadian resource company Gabriel Resources Ltd has said that it will “vigorously challenge” a value-added tax assessment issued by the Romanian tax authority, ANAF, which it says is linked to its decision to begin arbitration proceedings against the Romanian Government.

On June 30, 2017, Gabriel confirmed that it had filed a statement of claim against Romania before the World Bank’s International Centre for Settlement of Investment Disputes, accusing the country of breaching the terms of its bilateral investment treaties with Canada and the United Kingdom, and claiming USD5.7bn in compensation to cover losses it incurred as a result of Romania’s actions.

Supported by

Just days later, on July 6, the Toronto Stock Exchange-listed firm announced that ANAF had served its Romanian subsidiary, Rosia Montana Gold Corporation S.A., with a RON27m (USD6.8m) VAT assessment, relating to VAT previously claimed and received by RMGC in respect of its purchase of goods and services from July 2011 to January 2016.

However, Gabriel responded that it views the VAT assessment as “fundamentally flawed and abusive, and plainly retaliatory coming just days after the company filed its… arbitration against Romania.”

The company said that a prior VAT audit concluded by ANAF in July 2016 assessed a liability for approximately the same amount but was “successfully challenged by RMGC and partially quashed by ANAF.”

“Gabriel and RMGC will vigorously challenge this decision,” the statement said.

Jonathan Henry, Gabriel’s President and Chief Executive Officer, commented: “The company believes that the VAT assessment is without merit, enacted by ANAF alongside other actions with an overarching purpose to intimidate Gabriel, RMGC, and their personnel and to frustrate the company’s pursuit of its international arbitration case against Romania. The fact that the VAT assessment has been received immediately after the company has filed the ICSID arbitration claim of USD5.7bn against Romania is not a coincidence; we see this as completely abusive and retaliatory.”

Gabriel said that the VAT assessment is due for payment on August 5, 2017, although RMGC has until August 21, 2017, to make an administrative appeal to ANAF, “which it fully intends to pursue.”

Source: tax-news

error: Content is protected !!