OCI Says Reaches ‘Advanced Stage’ In Talks With Egypt Tax
Orascom Construction Industries (OCIC.CA) announced that it has reached an advanced stage with Egyptian Tax Authority over the ongoing dispute about selling OCI assets to French Lafarge.
In a filling to the Egyptian Exchange (EGX), Orascom Construction Industries (OCIC.CA) announced on Tuesday that it has reached an advanced stage in its negotiations with the Egyptian Tax Authority to end the ongoing dispute over the sale of Orascom Building Materials to French Lafarge. OCI added that more details will be disclosed over the coming days.
Accordingly, the EGX management decided to resume trading on OCI’s stocks.
On April 14, Omar Derwaza – Head of Investor Relations at Orascom Construction Industries – announced that the ongoing negotiations between OCI and the Egyptian Tax Authority are likely to conclude very soon, expecting that the two parties are going to reach a final settlement agreement within the current week.
Derwaza declined to give a comment when he was asked about the value and the schedule of the installments OCI pledged to pay off. He said OCI is going to disclose within days all the details of the anticipatory agreement with the Tax Authority.
On April 13, sources close to the ongoing negotiations told Amwal Al Ghad that Orascom Construction Industries is offering to pay off US$ 350 million as a first installment to reconcile with Egypt’s Tax Authority over taxes dues worth EGP 7.1 billion.
For the remaining sums, they will be paid over a number of years to be defined in coordination between the company and the Tax Authority, sources said.
The sources further added that OCI has refused to pay the EGP 7.1 billion as one tranche due to reasons related to default on payments besides the lack of a sufficient liquidity for the current phase.
Amwal Al Ghad has quoted Tax Authority Chief Mamdouh Omar by saying the negotiations with the OCI are still ongoing, asserting that the reconciliation option is very attainable at any moment. Omar has denied that the ETA’s negotiations with OCI have reached a deadlock.
The anticipatory settlement agreement comes after 7-month tax disputes over EGP 14 billion tax evasion claims against OCI erupted by selling Orascom Building Materials to French Lafarge for EGP 68.6 billion in 2007.
