"An agreement was reached to utilize TRGI’s Value Added Tax (VAT) returns to offset royalties associated with gold production exports, with royalty payments for exports being honoured as they accrued… Unfortunately, a setback occurred when the Guyana Revenue Authority [GRA] denied TRGI’s VAT claims for the years 2018, 2019, and 2020. In response to this denial, TRGI issued a ‘Notice of Default,’” the source added."
"Troy in turn issued a notice of default in January of 2021, and later in April issued a Notice of Dispute to the Minister of Natural Resources, Ministry of Finance, and the Guyana Geology and Mines Commission (GGMC). It was also forwarded to the GRA and the Attorney General’s Chambers."
Now it gets interesting. The Mineral Agreement stipulates (17) that arbitration proceedings will happen in Port of Spain, Trinidad.
None of that was honoured by the GoG making there counterclaims baseless.
Also interesting how the sum of the "unpaid" royalty is calculated, now allegedly 2.6 bn Guyana Dollars (while previously it was 1.5 bn): This is simply calculated by multiplying the amount of ounces to be paid as royalty multiplied by todays gold price. Which of course is baseless again: Gold is not an official means of payment in Guyana and thus the royalty amount that was due in 2018, 2019 and 2020 is fixed in GYD and remains at short of US$ 7m.
Guyanese law is pretty clear that after 6 tax periods VAT refunds are to be paid out and the amount due to be repaid to Troy pretty much cancels out the royalty payments, it seems there even was an agreement with the GoG and the GRA just defaulted on the repayment.
This could have huge legal ramifications.
Does the rule of law still apply in Guyana?
TRY Price at posting:
3.0¢ Sentiment: None Disclosure: Held
