Glencore hit with freezing orders
Glencore says its mining subsidiaries in the Democratic Republic of Congo have been served with freezing orders for alleged unpaid royalties of $3bn by a company affiliated to Israeli billionaire Dan Gertler. Gertler, who is the subject of US sanctions, is owed royalties by Glencore, but the company disputes the amounts.
Glencore’s mining subsidiaries in the Democratic Republic of the Congo (DRC) had been served with freezing orders for alleged unpaid royalties of nearly $3bn by a company affiliated with Israeli billionaire Dan Gertler, Glencore said on Friday.
Gertler, who is the subject of US sanctions, is owed some royalties by Glencore, but the London-listed company disputes the amounts claimed.
The US government added Gertler and affiliated companies to its specially designated nationals list in December 2017, accusing him of using his friendship with Congolese President Joseph Kabila to secure sweetheart mining deals.
Informed sources said Glencore would comply with the sanctions, which effectively cut off access to the global financial system.
Gertler’s Ventora Development Sasu is seeking $695m in unpaid and future royalties from Glencore subsidiary Mutanda Mining and $2.28bn from Glencore subsidiary Kamoto Copper Company (KCC).
Glencore’s statement said that Ventora accuses KCC of breaching an agreement by declining to make royalty payments because Gertler was under US sanctions. Gertler has denied all allegations of impropriety and a spokesman for Gertler’s Fleurette Group, previously Glencore’s partner in the mines, declined to comment.
Glencore said the orders would allow local authorities to freeze certain bank accounts, mining titles and assets.
“Glencore denies Mutanda and KCC are in breach of any of their obligations ... and also entirely rejects Ventora’s calculation of the value of the future royalties allegedly owed to Ventora,” the statement said.
A source familiar with the situation said that Glencore was looking to file an appeal early this week.
Glencore also disputes the choice of jurisdiction for the orders and said the agreement between its subsidiaries and Ventora were subject to English law.