7Minister may determine net market value in certain circumstances

7 Minister may determine net market value in certain circumstances

(1) If the Minister is of the opinion that the net market value reported in respect of a particular mineral is not a true or fair net market value of the mineral, the Minister may require the licensee to pay a royalty in relation to that mineral on the basis of the net market value of the mineral as determined by the Minister.

Examples

1 The holder of a mining licence gives the Department Head a production and royalty return under regulation 8. The Minister is of the view that the costs reported in relation to the sale of a mineral are unreasonably high. The Minister makes a determination under this regulation.

2 The holder of a mining licence gives the Department Head a production and royalty return under regulation 8. The Minister is of the view that the reported sale price of a mineral resulted from a transaction between related bodies corporate that was not a genuine commercial transaction. The Minister makes a determination under this regulation.

(2) Before making a determination under subregulation (1), the Minister—

(a) must give the licensee a written notice that—

(i) states that the Minister is of the opinion that the net market value of the mineral may not be a true or fair net market value of the mineral; and

(ii) states the reasons for that opinion; and

(iii) invites the licensee to make a written submission in response to the notice within the time specified by the Minister in the notice; and

(b) must consider any written submission that is made by the licensee within the time specified in the notice.

(3) For the purposes of subregulation (2)(a)(iii), the Minister must not specify a period of less than 7 days.

(4) If the Minister makes a determination under subregulation (1), the licensee must pay the difference between the amount of royalty already paid in respect of the mineral and the amount of royalty that is payable on the basis of the determination within 28 days after the date on which the licensee is given written notice of the determination.