A court in the Democratic Republic of the Congo (DRC) has ruled in favour of mining company Camec following attempts made last month to revoke its mining licences. However, the company’s intended acquisition of Katanga Mining has been halted.
Camec’s problems began last month when it was informed that the Attorney General of the DRC was taking steps to revoke particular licenses due to what he deems to be “serious irregularities” in the original issuing of the licenses.
Before the attempted licence repudiation, the owners were Boss Mining, owned by Camec, and Mukondo Mining, owned by Savannah Mining and Boss Mining. The attorney general wanted to see the rights over these mines revert to Gecamines, the state-owned mining company.
The discrepancies were said to be found in the transfer of the C19 and C21 licences in 2004 to Camec’s subsidiary, Boss Mining, and the transfer of licences C17 and C18 to Kababankola Mining Company (KMC), and Muukondo Mining, jointly owned by KMC and Boss Mining. The transfer of these licences was concluded in 2004 following an international arbitration through the International Centre for the Settlement of Investment Disputes.
Following this recent repudiation attempt, Camec immediately issued a statement that it believed there to be no valid legal basis for any revocation attempt, and said it would again seek international arbitration if the accusations were pursued.
However, the court Le Tribunal de Grande Instance found on Tuesday that the original transfers of the licences were made in accordance with the law therefore were entirely valid.
In a statement, Andrew Groves, chief executive of Camec said: “We have always been 100% confident of our rightful ownership of our mining licences in the DRC, and we welcome this judgement which reconfirms our position.”
When the allegations were first made, Camec issued another statement claiming they were raised in order to dispute the company’s attempt to acquire Katanga Mining. The announcement of the decision to revoke contracts was made on the same day in August that Camec publicly revealed its offer to purchase all issued and outstanding common shares of Katanga Mining.
“Camec believes that this action is motivated by commercial forces in the DRC who oppose Camec’s proposed acquisition of Katanga. Boss will continue to fight this unjustified threat in the DRC,” it stated.
Yet, on September 5 Camec announced that it would withdraw its offer for Katanga Mining, and stated it had been obliged to take this decision due to “the uncertainty relating to the mining licence regime in the Democratic Republic of the Congo”.