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Mali's new mining code ends tax exemptions, other protections

Wed 21st August, 2019 11:12pm
BAMAKO, Aug 21 (Reuters) - Mining companies operating in
Mali will no longer be exempt from VAT during production and
will have a shorter period of protection from fiscal changes,
according to a new mining code announced by the Mines Ministry
on Wednesday.
    The new code seeks to redress the "shortcomings" of a 2012
law by bringing a "substantial increase" in the contribution of
the mining sector to the economy, the Mines Ministry said in a
statement. 
    But it contains some clauses that international mining
companies have strongly opposed elsewhere in Africa, most
notably in the Democratic Republic of Congo where companies have
been at loggerheads with government. 
    The new code in Mali, Africa's third largest gold producer,
shortens the "stability period" during which mining companies'
existing investments are protected from changes to fiscal and
customs regimes. 
    Under the previous law, the stability clause was 30 years.
It was not made clear on Wednesday what the length of the new
stability period would be, but the Economy Ministry said last
year that the government aimed to reduce those protections to
the lifespan of a mine.
    Mali's government had been negotiating with mining companies
to draft a new mining code, but it said last year that it would
move to implement a new law unilaterally if no compromise was
reached. 
    It was not clear on Wednesday whether the new code was the
product of compromise or if it was proposed without
consultation. 
    Companies with stakes in industrial gold mines in Mali
include Barrick Gold Corp  ABX.TO , AngloGold Ashanti  ANGJ.J ,
B2Gold  BTO.TO  and Hummingbird Resources  HUMR.L .


 (Reporting by Tiemoko Diallo
Writing by Edward McAllister
Editing by Leslie Adler)
 ((edward.mcallister@tr.com; +221 33 864 5782;))
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