This item is part of Stockwatch's value added news feed and is only available to Stockwatch subscribers.Here is a sample of this item:Int'l Royalty sues Vale Inco for royalty underpayment 2009-10-16 09:27 ET - News Release Mr. Douglas Silver reports INTERNATIONAL ROYALTY FILES CLAIM AGAINST VALE INCO FOR UNDERPAYMENT OF ROYALTY International Royalty Corp., as general partner of the Labrador Nickel Royalty LP (LNRLP), has filed a claim in the Supreme Court of Newfoundland and Labrador against Vale Inco Ltd. and its wholly owned subsidiaries, Vale Inco Atlantic Sales Ltd. (VIASL) and Vale Inco Newfoundland and Labrador Ltd. (VINL), related to the calculation of the net smelter return (NSR) on the sale of nickel concentrates from VINL's Voisey's bay mine to Vale Inco. The NSR is the basis for payment of the 3-per-cent royalty due to LNRLP, which is 90 per cent owned by IRC. The claim requests specific damages for underpayment of past royalties and an order in respect of the correct calculation of future payments.
The claim asserts that Vale Inco is under-reporting the NSR in two ways:
-
Payments made to VINL for the sale of nickel concentrates under
the terms of non-arm's-length contracts between Vale Inco, VIASL
and VINL do not represent fair market value and Vale Inco has
incorrectly calculated the NSR paid to VINL through these
contracts.
- VINL has deducted certain income taxes that it pays to the
province of Newfoundland and Labrador in determining the NSR,
which is not allowable under the royalty agreement.
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