Accountant and financial analyst Christopher Ram says Chinese bauxite company, Bosai Minerals Group has not filed their annual returns for the years 2011 and 2012 and wants the company to explain this in light of its reputed non-payment of royalties to the Guyana Geology and Mines Commission (GGMC) even after the expiration of a moratorium on such payments.
Speaking to Stabroek News yesterday, Ram challenged Company Secretary of Bosai Minerals Group Norman McLean to come clean about filing of annual returns for the two years.
“He must answer since as Company Secretary he is responsible for preparing and submitting them,” he said of McLean.
Ram also said that the company has failed to comply with the Companies Act in the returns that were submitted, adding that the company did not prepare its Director’s annual report in the prescribed manner.
“…the company has been delinquent in filing annual returns for 2011 and 2012,” said Ram. “The Companies Act imposes on every director and officer of a company a duty to comply with the Act. It also provides that if anyone breaches the provisions of the Act for which there are no specific penalties, that person is guilty of a general offence,” he said.
Ram said that the filing of annual returns is one of the core functions of the Company Secretary, “the hat Mr. McLean wore in defending the violation of the Bauxite (Production Levy) Act.”
“It may be merely coincidental that no return has been filed since the 2010 statements became the subject of a critical newspaper column to which Mr. McLean has taken belated objections,” Ram conjectured. “But it does mean that a company which extracts more than a million tonnes of non-renewable resources annually and which enjoys questionable tax concessions, is arrogantly ignoring the law regulating companies,” Ram said.
Ram is also perturbed by McLean’s response which said that the company built dust collectors “so shortly after its start up” and that this spoke to the company’s good corporate social responsibility.
Efforts to reach McLean for a response to the concerns Ram raised were futile.
The media questions over Bosai and its payment of royalties, Corporation Tax and submission of annual returns began last week following a meeting of the Sectoral Committee of Natural Resources in the National Assembly where it was revealed that the company owed royalties to the Guyana Geology and Mines Commission in the order of US$54 million. APNU Member of Parliament Joe Harmon posed the question to Minister of Natural Resources and the Environment Robert Persaud whether the company has been paying its share of royalties for bauxite exported.
Minister Persaud gave the meeting the assurance that the Ministry would be getting back to the committee with regards to the questions posed by Harmon.
However over the last week, McLean defended the company’s integrity and slammed Ram and Harmon for what he called attempts to bring the company’s standing in the corporate arena into disrepute.
He said that as per the Mineral Agreement signed between the Government of Guyana and Bosai, the company is required to pay Corporation Tax only following a five-year moratorium on such payments and only if the company is generating profits. In addition, the agreement states that any royalties due on the FOB value of bauxite shipped will be offset by the Corporation Tax paid.
Rejecting the defence by McLean, Harmon called on the Government and the company to provide evidence of the payment of Corporation Tax and the royalties that the tax would have offset. He also pointed out that the agreement between the Government and Bosai was signed in December 2004 and as such the five-year tax holiday would have come to an end in 2009.