CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Canadian Mining Firm Challenging 'Retaliatory' Romanian VAT Claim

Canadian Mining Firm Challenging 'Retaliatory' Romanian VAT Claim

by Ulrika Lomas,, Brussels

19 July 2017

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.

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. (RMGC), 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."

TAGS: tax | investment | value added tax (VAT) | mining | law | investment treaty | audit | Romania | United Kingdom | tax authority | Canada | services | Investment | Invest | Investment

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »