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DRC turns down mining industry's proposed revisions to mining code

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DRC turns down mining industry's proposed revisions to mining code

The Democratic Republic of the Congo rejected a proposal by mining companies to relax some provisions in the new mining code in return for higher royalties, Reuters reported March 23.

According to the report, mining companies operating in the country were willing to pay the government higher royalties if it agreed to nullify certain taxes and to a 10-year exemption to changes to the current fiscal and customs regimes of existing projects.

The government of President Joseph Kabila signed the code into law March 9 but assured companies, including Randgold Resources Ltd., Glencore PLC, China Molybdenum Co. Ltd. and Ivanhoe Mines Ltd. that their concerns over the regulations will be heard.

Among the provisions opposed by the companies include a 50% windfall profits tax for cobalt, gold and copper, among others. In addition to the code, the office of Prime Minister Bruno Tshibala also announced that the government planned to designate cobalt and copper as strategic minerals, which will potentially hike royalty rates to 10%.

Earlier this month, major mining companies in the Democratic Republic of the Congo quit the country's Chamber of Commerce ahead of planned talks with the government on the mining code, claiming the chamber did not adequately represent their interests.