Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Vale Royalty Dispute With Brazil Close to End, Minister Says

March 1 (Bloomberg) -- Vale SA and the Brazilian government are close to an agreement on a dispute over unpaid royalty payments that may reach 7 billion reais ($4.09 billion), Mines and Energy Minister Edison Lobao said.

The Brazilian government is analyzing documentation provided by Vale, the world’s largest iron-ore exporter, and expects to reach a conclusion on the amount of overdue payments, Lobao told reporters in Brasilia today. The amount owed, which was 4 billion reais in 2008, may reach 7 billion reais including penalties and interest, he said.

Vale, based in Rio de Janeiro, has been fighting tax claims from the government amid growth in its exports and rising minerals prices. The company and Brazil’s National Mineral Production Department failed to reach an agreement by an initial October deadline. Talks were extended an extra 60 days earlier this week to bring an end to the dispute.

The company estimated its liability could be as much as 7.88 billion reais ($4.6 billion) in an April 28 filing with the U.S. Securities and Exchange Commission. Brazil is also looking for additional tax payments on profits at Vale’s foreign operations, according to the filing.

A Vale official declined to comment about the minister’s statement today.

Vale gained 1.1 percent to 42.95 reais at the close in Sao Paulo. The shares have gained 14 percent this year.

To contact the reporters on this story: Maria Luiza Rabello in Brasilia Newsroom at mrabello@bloomberg.net; Juan Pablo Spinetto in Rio de Janeiro at jspinetto@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.