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Catholic bishops urge mining companies to stop using tax havens

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The Justice and Peace Commission for Southern African Catholics Bishops Conference (SACBC) has written to 21 mining companies operating in South Africa asking each to explain why it is using tax havens.
New research conducted for the SACBC Justice and Peace Commission shows that these 21 companies, which include some of the largest in the country such as Anglo American, AngloGold Ashanti, Impala Platinum, LonMin and Petra Diamonds, all have subsidiaries in tax havens, also known as secrecy jurisdictions: these include the British Virgin Islands, Cayman Islands, Mauritius, Jersey, the Netherlands and Bermuda. The 21 companies collectively have 117 subsidiaries in such tax havens.

The SACBC Justice and Peace Commission is not accusing these companies of engaging in tax avoidance. However, having big number of susbidiaries in tax havens raises suscipicion of tax avoidance and illicit financial flows. The SACBC Justice and Peace Commission is therefore asking these 21 companies  to make a voluntary commitment to disclose why they have many subsidiaries in these tax havens.

Illicit financial flows deprive South Africa of tax resources that could have been used to uplift the lives of the poor. According to recent estimates from Global Financial Integrity, SA has lost more than $100.7bn over for the period 2002-2011. Tax havens and illicit financial flows facilitate corruption by companies which is equally harmful to the poor as the corruption by the high level politicians in South Africa.

SACBC Justice and Peace Commission therefore urge the multinational mining companies to make voluntary commitment to report their key financial figures on a country-by-country basis in all countries where they operate.

LISTS OF MULTINATIONAL COMPANIES THAT HAVE SUBSIDIARIES IN THE TAX HAVENS

Anglo American:  It lists a very large number of subsidiaries and associate companies in tax havens: Bermuda (two companies), British Virgin Islands (8), Cayman Islands (1), Isle of Man (2), Luxembourg (10), Mauritius (5), and the Netherlands (17).[i]

Anglogold Ashanti:  It has a subsidiary, AngloGold Ashanti PLC, which is incorporated in the Isle of Man and a joint venture, Kibali (Jersey) ltd, which is incorporated in Jersey.[ii]

ASA Resource Group PLC:  It has seven subsidiaries in the British Virgin Islands, five in Mauritius and one in the Cayman Islands.[iii]

Bushveld Minerals:  It has seven subsidiaries in Mauritius, one in the British Virgin Islands and three in Guernsey.  These 11 subsidiaries in tax havens account for more than half of the company’s total number of subsidiaries (19).[iv]

Central Rand Gold:  Central Rand Gold’s Annual report 2015 (the latest available on its website)states that the company has subsidiaries in the Netherlands Antilles (Central Rand Gold (Netherlands Antilles) BV) and in Guernsey (Central Rand Gold Benefit Trust).[v]

DiamondCorp:  It lists two of its six subsidiaries as incorporated in the British Virgin Islands (DiamondCorp Holdings Ltd and Botswana DiamondCorp Ltd).[vi]

Eastern Platinum Ltd:  Of Eastern Platinum’s 12 subsidiaries, three are in the British Virgin Islands and one is in Barbados.[vii]

Exxaro Resources:  The company’s 2016 Annual Financial Report states that it has subsidiaries in Mauritius (Mayoko Investment Company but which was sold in 2016), Bermuda (AKI Exploration (Bermuda) Proprietary Limited, also sold in 2016) and three in the Netherlands (Exxaro Base Metals International BV, Exxaro International BV and Exxaro Mineral Sands BV).

Galileo Resources:  Galileo has one subsidiary in the British Virgin Islands (Skiptons Global Investments Ltd).[viii]

Gold Fields Ltd:  It has three subsidiaries in British Virgin Islands and one each in Switzerland and the Netherlands.[ix] The financial statements of the company’s Gold Fields Netherlands Services B.V. The financial accounts indicate that the Dutch company had only one employee but a significant role in Gold Fields’ structure. The company’s 2016 annual report states: “Gold Fields does not artificially shift profits to… [low-tax] locations.”[x]

Harmony Gold:  It has a subsidiary in the Isle of Man (Harmony Gold Ltd).[xi]

Impala Platinum:  It has one subsidiary in the Netherlands (Impala Platinum BV), one in Guernsey (Zimplats Holdings Ltd) and a joint venture in Mauritius (Mimosa).[xii]

Jubilee Platinum:  It lists one subsidiary (Braemore Holdings (Mauritius) Pty Ltd) in Mauritius.[xiii]

Kumba Iron Ore, part of Anglo American:  It has two subsidiaries in the Netherlands and two in Luxembourg.[xiv]

LonMin:  It has three subsidiaries in the British Virgin Islands and one in the Cayman Islands.[xv]

Petra Diamonds:  It is incorporated in Bermuda and has subsidiaries in the British Virgin Islands (BVI), Bermuda, Jersey and the Netherlands.[xvi]

Resource Generation Ltd: Of the company’s eight subsidiaries, two are incorporated in Mauritius.[xvii]

Sibanye Stillwater:  The company database Orbis lists 34 subsidiaries for Sibanye of which two are in Bermuda. However, the company’s 2016 Annual Financial Report 2016 does not mention any subsidiaries in Bermuda.[xviii] It lists a company called Sibanye Proprietary Platinum Ltd. It is not clear if this is the same company as listed elsewhere on the Sibanye’s website as Sibanye Platinum Bermuda Proprietary Limited; this is a wholly owned subsidiary of Sibanye registered in Bermuda.[xix]

Sylvania Platinum Ltd: Sylvania is itself incorporated in Bermuda and has three subsidiaries in Mauritius.[xx]

Tower Resources PLC: Tower Resources lists two subsidiaries in the Isle of Man and one in the British Virgin Islands.[xxi]

Xtract Resources:  It lists three subsidiaries in the Netherlands and one in the British Virgin Islands.[xxii]

1 Comment

  1. zvodret iluret

    September 7, 2018 at 7:58 am

    Everything is very open and very clear explanation of issues. was truly information. Your website is very useful. Thanks for sharing.

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