Mining

The court for tax evasion was delayed because of a prosecution of the expert in OKD affair Because of arrest of businessman Martin Uher and his companion Pavlína Nováčková in 2006, the police started to uncover one of the biggest cases regarding tax evasion for sold propellant. Finally after ten years of investigating, public prosecutor managed to bring five persons to justice. Unfortunately the court denied taking an expert’s opinion, regarding accountancy of interested companies, into consideration. The main author Rudolf Doucha is prosecuting because of a distorted opinion on his basis the Czech Republic should lose 5.7 billion Czech crowns, when the state sold their own stake in OKD. Doucha is suspended, so he can’t confirm his expert’s opinion. By force of these circumstances, the president of the senate decided to make a new expert’s analysis, said a press agent of the Pilsen district court. But this should be a problem because it has been lost some important accountancy documents, according to press Právo. Three businessmen, one accountant and one layer face several charges of fraud and legalization revenues from criminal activity. According to the expert analysis, already mentioned Uher and Nováčková were the main actors of the fraud and through companies Solitor, Radeost and OilMaster imported since 2014 to 2016 to Czech Republic hundreds of tank trucks with petrol and did not pay the full excise tax. Accused businessmen did not manipulate with tax return and they officially declare their duty to pay the debts. They said that they wanted to pay, but their companies do not have money, so they can’t afford it. To make this impression, they show fake transactions. In the papers, it looks like they do not have money, but in fact, they have big profits. Prosecuted traders used the opportunity of the introduction of free trade within the European Union in May 2004, when customs controls disappeared from the borders.

An investigation into South Africa's President Jacob Zuma has found evidence of possible corruption at the top level of his government. In the report of Thuli Madonsela, former Public Protector, Mr Zuma is accused of an improper relationship with wealthy businessmen of the Gupta family.

The Kansanshi mine , owned by Kansanshi Mining PLC and ZCCM, is still waiting to receive millions of US dollars in Value Added Tax (VAT) refunds from the Zambian Revenue Agency. Despite claims that a payment of around ZMK 857,005,562 (USD $85,700,556) was made to the mining company, Kansanshi Mining argued that no VAT refunds were received in 2014. This information was revealed by analysing seven Extractive Industries Transparency Initiative (EITI) reports published from 2008-2014, which hold information on over forty companies making payment disclosures each year.

Israeli police are questioning a diamond dealer on suspicion of Embezzlement as part of a fraud investigation that could involve sums of up to $65 million (£45m).

New evidence shows oil, gas; mining firms use loopholes and avoid tax depriving communities of much-needed resource income

Last month, the US Securities and Exchange Commission (SEC) passed a rule that will require resource extraction issuers to disclose the payments that they make to governments for the commercial development of oil, gas and minerals resources. This is a significant step forward also for Indonesia as several companies listed in the US operate in the country and the data of the payments that these companies make to the Indonesian government will now become available. Similar laws already exist in the EU, Canada and Norway. The number of oil, gas and mining companies in the US is huge and, on top of that, they are classified as big extractive companies as they operate around the globe with significant capital.

We, members of Civil Society Organizations in Zambia working on issues of extractive industries observed that on 8th – 9th December 2015 in Kiev, the Global Transparency Initiative which promotes good governance of natural resources – the Extractive Industries Transparency Initiative (EITI) – agreed to make beneficial ownership transparency an obligation on all 49 member countries.

According to a 2014 report from Global Financial Integrity entitled “Illicit Financial Flows from Developing Countries: 2003- 2012”, Indonesia ranks seventh of countries with the largest illicit Financial Flows (IFF). In 2014 IFF in Indonesia is estimated at a total of IDR 227.75 trillion ($20 billion), the mining sector contributes IDR 23.89 trillion ($2 billion), mainly derived from trade mis-invoicing. Late 2015 Publish What You Pay Indonesia conducted a study on IFF and tax crime in the mining sector in Indonesia. This is an urgent issue, given the sad reality of Indonesia among the top seven developing countries with highest IFF.

The Anti-corruption Police became interested in the management of the mining company OKD, which is in bankruptcy since May and has a multimillion debts. Detectives examine NWR Holdings B.V. (owner of OKD) and suspicious transactions. For example, OKD guarantee the billions in bonds and some of its assets were transferred to other companies.

The Extractive Industries Transparency Initiative calls on mining companies to publish what they pay to government and governments to publish what they receive from government.