Democratic Republic of Congo’s central bank has announced stiff new financial penalties for companies that fail to repatriate at least 40 percent of their revenues from mineral exports, a decree seen by Reuters on Tuesday showed.
Congo, Africa’s top copper producer, has been hit hard by low commodity prices over the last two years and is seeking emergency financial support from international donors to contain inflation expected to top 30 percent this year.
The decree, signed by central bank governor Deogratias Mutombo, imposes a penalty of 1 percent of the non-repatriated sum for each day that it is not repatriated. It also decrees a fine of up to 200 million Congolese francs ($125,000) for failure to communicate to the central bank details of a foreign bank account.
Mutombo said that the action was taken due to “the manifest failure by certain economic operators (to) respect legal and regulatory dispositions.”
Congo’s oil and mining sectors account for about 95 percent of its export revenues. The government has long complained that mining companies do not pay enough in taxes and is trying to revise the country’s 2002 mining code to hike taxes and royalties.
Mining companies oppose the proposed revision, which they say would make them unprofitable. They say that tax agencies hit them with hundreds of millions of dollars in unjustified penalties.
Reporting By Aaron Ross; Editing by Tim Cocks