Land rent is reduced for Access Industries in Kazakhstan

/IRBIS, Feb.15, 00/ - REUTERS informs, with the reference to the deputy of head of region on economy Mukhametkali Ospanov, that the budget of Pavlodar region will not receive more than one and a half million tenges this year due to a reduction of land rent for the American coal mining company Access Industries. The resolution reduced the land rent from KZT600 mln down to KZT3 mln a year for Access Industries. Financiers of the region inform that KZT1.5 bln is based on the reduction of the land rate from KZT600 mln down to KZT3 mln, and also the repayment of KZT900 mln to the company that was paid to regional budget last year by the resolution of the Supreme Court. Ospanov said that the government was ignoring the interests of the donor region by adopting this resolution, since the regional budget has been already ratified and its revenues has been already calculated and approved by the Ministry of finance. He also said the region had to pay about KZT5 bln, but due to KZT1.5 bln loss these obligations would be hard to meet and it may reduce the social allowances, pensions and salaries of budgetary organizations. The management of the company believes this resolution restores their rights as foreign investors. Executive director of the company said this January 12 resolution proved that the law "On protection of foreign investments" functions in the country. He also said that three years they had to prove that they were foreign investors and that changes in tax rates did not bother them. This land question was posed as far back as in 1998. Access Industries required the land rent to remain unchanged in accordance with the law "On foreign investments" at the level when the mine was sold. Since the Supreme court did not satisfied the claim of the company, it had to pay KZT950 mln instead of KZT3 mln a year for 1998 and 1999. Executive director of the company said that if there was a problem with the budget then it should be resolved within the government, not with the management of the company.