cruiser51
Top 20
viewAVZ Minerals Ltd
(
ASX:AVZ
)
AVZ Minerals Ltd (ASX:AVZ) is taking legal action to assert its rights to the Manono Lithium and Tin Project in the DRC, bringing an arbitration case to the ICC International Court of Arbitration and preparing a second against La Congolaise d’Exploitation Minière (Cominière) and Dathomir.
This is part of an ongoing legal battle over the ownership split of the Democratic Republic of Congo (DRC) project.
The Manono Project was originally held in a 75:25 split between Cominière and Dathomir in a joint venture agreement (JV) under the Dathcom company.
AVZ Minerals bought into the agreement with the purchase of 60% of Dathomir’s shares in a binding term sheet, which would eventually give AVZ a 60% interest in Manono with Dathomir retaining 15% and Cominière 25%.
In 2019 and 2020 AVZ and its subsidiary entered into two separate binding contracts for Dathomir’s sale and AVZ’s purchase of 15% of the shares in Dathcom, the company through which the Manono Project was held.
At the time of writing, AVZ asserts it owns a 75% interest in Manono and retains the pre-emptive rights to a further 15% of the project’s ownership.
The remaining 10% must be held by the DRC Government under the country’s mining law.
AVZ maintains it has strong prospects of success in the arbitration proceedings, an assertion supported by the current political climate – President Félix Tshisekedi has made ending corruption a focus of his government, especially in the mining industry.
AVZ’s subsidiary completed all requirements for the interest sale in August 2021, ostensibly legally acquiring the 15% interest in Dathcom.
Dathomir maintained its claim of terminating the agreements and denied the validity of the acquisition.
As both agreements are subject to formal, properly constituted arbitration, only a proper tribunal has legal jurisdiction to rule on the dispute.
Dathomir had not moved to begin any such arbitration proceedings as of December 1, 2022, prompting AVZ to bring the ‘First Dathomir Arbitration’ and soon the ‘Second Dathomir Arbitration’ to put an end to the conflict and recover losses from Dathomir.
Cominière, the nationally-held DRC mining company, holds a 25% interest in Dathcom, the holding company for the Manono Project.
The shareholders of Dathcom (AVZ and Cominière) are party to a JV agreement which includes a right of first refusal on proposed transfers of Dathcom shares to third parties.
Under DRC laws, a transfer of shares made in violation of right of first refusal of this kind is null and void.
Cominière purported to transfer shares in Dathcom to a third party (Jin Cheng Mining Company Limited, a subsidiary of Zijin Mining Group Company Limited) in breach of AVZ’s right of first refusal, which is the subject of the Jin Cheng ICC Arbitration Proceedings.
Indeed, the DRC General Inspectorate of Finance's report on the dispute stated: “Cominière has acted in violation of its articles of association in respect of its transfers of mining titles to 'external partners' without obtaining financial guarantees.”
The report went on to describe the Jin Cheng Sale as “subject to a number of irregularities”.
“The company considers it has strong prospects of success in the Dathomir Arbitrations and Jin Cheng ICC Arbitration Proceedings and will vigorously pursue its claims to vindication,” AVZ asserted in an announcement to the market.
(
ASX:AVZ
)
AVZ Minerals takes legal action as it seeks to affirm interests in Manono Project
AVZ Minerals Ltd (ASX:AVZ) is taking legal action to assert its rights to the Manono Lithium and Tin Project in the DRC, bringing an arbitration case to the ICC International Court of Arbitration and preparing a second against La Congolaise d’Exploitation Minière (Cominière) and Dathomir.
This is part of an ongoing legal battle over the ownership split of the Democratic Republic of Congo (DRC) project.
The Manono Project was originally held in a 75:25 split between Cominière and Dathomir in a joint venture agreement (JV) under the Dathcom company.
AVZ Minerals bought into the agreement with the purchase of 60% of Dathomir’s shares in a binding term sheet, which would eventually give AVZ a 60% interest in Manono with Dathomir retaining 15% and Cominière 25%.
In 2019 and 2020 AVZ and its subsidiary entered into two separate binding contracts for Dathomir’s sale and AVZ’s purchase of 15% of the shares in Dathcom, the company through which the Manono Project was held.
At the time of writing, AVZ asserts it owns a 75% interest in Manono and retains the pre-emptive rights to a further 15% of the project’s ownership.
The remaining 10% must be held by the DRC Government under the country’s mining law.
AVZ maintains it has strong prospects of success in the arbitration proceedings, an assertion supported by the current political climate – President Félix Tshisekedi has made ending corruption a focus of his government, especially in the mining industry.
Dathomir claims to terminate agreements
Dathomir claimed to terminate the binding agreements with AVZ via letter on May 14, 2021. The letter did not cite any valid grounds for termination, according to AVZ, nor did it have a legally binding effect.AVZ’s subsidiary completed all requirements for the interest sale in August 2021, ostensibly legally acquiring the 15% interest in Dathcom.
Dathomir maintained its claim of terminating the agreements and denied the validity of the acquisition.
As both agreements are subject to formal, properly constituted arbitration, only a proper tribunal has legal jurisdiction to rule on the dispute.
Dathomir had not moved to begin any such arbitration proceedings as of December 1, 2022, prompting AVZ to bring the ‘First Dathomir Arbitration’ and soon the ‘Second Dathomir Arbitration’ to put an end to the conflict and recover losses from Dathomir.
The Cominière controversy
In a separate but equally unbinding (according to AVZ) attempt to undermine AVZ’s ownership of Manono, La Congolaise d’Exploitation Minière (Cominière) is also in hot water with the company.Cominière, the nationally-held DRC mining company, holds a 25% interest in Dathcom, the holding company for the Manono Project.
The shareholders of Dathcom (AVZ and Cominière) are party to a JV agreement which includes a right of first refusal on proposed transfers of Dathcom shares to third parties.
Under DRC laws, a transfer of shares made in violation of right of first refusal of this kind is null and void.
Cominière purported to transfer shares in Dathcom to a third party (Jin Cheng Mining Company Limited, a subsidiary of Zijin Mining Group Company Limited) in breach of AVZ’s right of first refusal, which is the subject of the Jin Cheng ICC Arbitration Proceedings.
Indeed, the DRC General Inspectorate of Finance's report on the dispute stated: “Cominière has acted in violation of its articles of association in respect of its transfers of mining titles to 'external partners' without obtaining financial guarantees.”
The report went on to describe the Jin Cheng Sale as “subject to a number of irregularities”.
“The company considers it has strong prospects of success in the Dathomir Arbitrations and Jin Cheng ICC Arbitration Proceedings and will vigorously pursue its claims to vindication,” AVZ asserted in an announcement to the market.
