The WA State Administrative Tribunal has ordered a reassessment of duty on mining tenements based on a dutiable value of $1.14bn.

On 8 September 2010, the boards of Avoca Resources Limited and Anatolia Minerals Development Limited announced that they had agreed to enter into a scheme of arrangement under which Anatolia would acquire all of the shares in Avoca. On 18 February 2011, Anatolia, through its subsidiary Alacer Gold Pty Ltd acquired all of the issued shares in Avoca. Anatolia issued shares in itself to the former Avoca shareholders as consideration and Anatolia then changed its name to Alacer Gold Corp. Avoca was at the relevant date entitled to land and chattels comprising certain mining interests in WA.

The Commissioner assessed the dutiable value of the land and chattels to be approximately $1.25bn, to which Alacer objected. Alacer argued that the dutiable value of the land and chattels was $382.4m.

The Tribunal noted there was no dispute between the parties that the amount paid by Anatolia for all of the issued shares in Avoca, including liabilities taken over, was $1,253,475,000. After excluding the value of Avoca’s assets which were not land and chattels, the Tribunal concluded that the monetary value of the consideration given for Avoca’s land and chattels was $1,139,365,000. Accordingly, the Tribunal ordered a reassessment of the duty payable on the basis that the dutiable value of the transaction was $1,139,365,000.

(Alacer Gold Corp and Hill 51 Pty Ltd (formerly Alacer Gold Pty Ltd) and Comr of State Revenue [2016] WASAT 31, WA State Administrative Tribunal, Sharp DP, 6 April 2016.)

[LTN 67, 11/4/16]