REG - Eurasia Mining PLC - Supreme Court Tax Litigation Win

Eurasia MiningAnnouncement

11/01/2024 10:30

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RNS Number : 3985Z  Eurasia Mining PLC  11 January 2024

This Announcement contains inside information for the purposes of the UK
version of the market abuse regulation (EU No. 596/2014) as it forms part of
United Kingdom domestic law by virtue of the European Union (Withdrawal) Act
2018 ("UK MAR").

 

11 January 2024

 

Eurasia Mining Plc

 

Supreme Court Tax Litigation Win

Eurasia Mining Plc ("Eurasia" or the "Company"), the palladium, platinum,
rhodium, iridium and gold mining company, is delighted to announce that its
subsidiary, Kosvinsky Kamen CJSC, has won litigation in relation to a mining
tax claim against the tax authorities in the Supreme Court in Moscow.

 

Highlights:

 

·      At the beginning of 2021, changes to the tax code came into force
that were aimed at unifying the mining tax rate. This included increasing the
tax rate for certain minerals from 1% to 3.5%.

 

·      The tax authorities applied the adjusted 3.5 multiple increase to
other minerals that were already taxed at rates of 6% or more. The subsidiary
had been paying 6.5% and this increased the rate to 22.75%.

 

·      The Company challenged this misinterpretation of the laws by the
tax authorities and, via its subsidiary, started a litigation process against
the tax authorities.

 

·      Albeit initially unsuccessful in the lower court, Eurasia
challenged the verdict and its subsidiary has now won the case in the Supreme
Court.

 

·      The overpayments of the mining tax made by the Company since the
beginning of 2021 will now be returned by the tax authorities in full (with
any relevant fines and other penalties that had been applied by the tax
authorities) plus interest at the rate set by the Central Bank for the
relevant periods (that is currently set at 16% per annum) covering the
three-year period which ended December 2023. This will allow the Company to
strengthen its cash position as explained below.

 

·      The first tranche payment of approximately £480,000 from the tax
authorities has been transferred, and the Company's cash position as of 31
December 2023 was approximately £989,000.

 

·      Notwithstanding the previously notified unsold inventories of
concentrates from the 2022 mining season, the Company now has sufficient
working capital to meet ongoing obligations until early Q32024, and further
repayments from the tax authorities, as yet unquantified, are expected to be
transferred related to the reduction in the tax rates for the 3 year period.

 

·      The Company's interests in the Supreme Court were represented by
the Pepeliaev Group, a leading CIS tax advisory law firm.

 

Chairman, Christian Schaffalitzky, commented: "We are delighted to have
successfully won the litigation at the top level of the Supreme Court and we
are extremely grateful to our in-house team and our advisers from Pepeliaev
Group who assisted us on this matter."

 

For further information, please contact:

 

Eurasia Mining Plc

Christian Schaffalitzky

+44 (0)207 932 0418

 

SP Angel Corporate Finance LLP (Nomad and Broker)

Jeff Keating / David Hignell / Adam Cowl

+44 (0)20 3470 0470

 

Yellow Jersey PR (Financial PR)

Charles Goodwin / Shivantha
Thambirajah

+44 (0)207 932 0418

eurasia@yellowjerseypr.com (mailto:eurasia@yellowjerseypr.com)

 

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