NEW YORK, May 4 (Reuters) - The government of the Democratic Republic of Congo has made no substantial concessions to major miners demanding changes to a new mining code they say will discourage investment, according to a draft document seen by Reuters on Friday.
International mining companies including Glencore and Randgold at the end of March outlined a proposal that includes a sliding scale for royalty rates on commodities mined in Congo.
In exchange, the government would eliminate a 50 percent tax on windfall profits.
The country mines more than half the world’s cobalt - used in batteries for electric vehicles and other electronics - and is Africa’s top copper producer.
A 702-page draft of regulations to implement the code, which the mines ministry has circulated among mining companies, retains mention of a windfall tax or “special tax on excess profits”.
It kicks in at a rate of 50 percent when commodity prices are 25 percent higher than planned in a bankable feasibility study, drawn up by miners to determine the viability of a project.
It also makes no mention of the stability clause sought by international miners, which in the previous code protected them against changes to the fiscal regime for a decade.
In addition, it provides for the prime minister to designate by decree minerals as “strategic substances,” which would be hit with a 10 percent royalty rate. The prime minister’s office has said that cobalt will be designated a strategic substance and copper could be too.
Time is running out to negotiate as the deadline for the new regulations to be signed into law is within 90 days of President Joseph Kabila signing the code on March 9.
A spokeswoman for Randgold, which is representing seven of the largest foreign miners in Congo, said she could not comment and that negotiations continued. (Additional reporting by Barbara Lewis. Editing by Jane Merriman)