Bosnia: Mine “Arcelor Mittal” Denies Media Reports on Concession

, Investors

It was announced from “Arcelor Mittal” Mine in Prijedor that inaccurate and misleadinginformation about the status of concession agreement between the mine and the Government of Republika Srpska appeared in some media reports.

In addition, there are incorrect statements related to cooperation with the Government of RSconcerning BAM 50 million of unpaid taxes and retained earnings with partner Iron Ore Mine “Ljubija”.They find that there is an excessive damage to the mine, the local community, but also toRepublika Srpska and Bosnia and Herzegovina.
– It is true that the company has not signed the Concession Agreement, but the text of thecontract has been agreed with the relevant ministry, and all necessary documentation has beenprepared and submitted, as requested. Therefore, any delay in the conclusion of this agreement isnot the result of company failure to fulfill its obligations – it is reported in the statement.
It was added that despite the lack of a concession agreement, Mittal, has been paying from thefirst day a concession fee for every excavated and sold ton of iron ore, according to the decisionof the competent ministry, based on which they have paid over BAM 30 million so far.
They claim that the company regularly settles all tax liabilities and in accordancewith the law, including income tax, but that the Tax Administration in 2015 issued a decision that”ArcelorMittal” Prijedor owes about BAM 50 million of income tax basedon transfer prices.
– After our lawsuit, the court passed a verdict in September 2016, taking into account all of ourevidence that we submitted during the tax audit, which annulled the decision of the TaxAdministration of the Republika Srpska and returned the case for retrial – it is said from themine. Among other allegations, it is stated that since the establishment it has been paid BAM 125million for the net salary and other remuneration for 830 employees, fortaxes and contributions on personal income tax over BAM 75 million, otherfees to the state in accordance with the law over BAM 5 million, income tax BAM 14 million and over BAM 3.5 million for projects tosupport the local community. When asked about the controversial concessions, “EuroBlic” got a reply from the Ministry ofIndustry, Energy and Mining of Republika Srpska.

They confirmed that the decision which approved the exploitation of iron ore at Omarska is effective until the final decision of the Government of Republika Srpska on granting the concessions for exploitation.
They added thatbased on this solution, “Mittal” pays a fee amounting to 3.6 percent of the total income from thesale or the use of mineral resources.
– In respect of the concession agreement, “Mittal” has applied for granting concession, and theprocess is ongoing. The procedure is carried out in accordance with the provisions of theConcessions Act which was in force at the time of applying for granting concessions – it isclaimed from the Ministry.

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