4GArrangements purporting to alter incidence of royalty to be

4G Arrangements purporting to alter incidence of royalty to be void (1) For the purposes of this section: arrangement means a contract, agreement, plan or understanding (whether enforceable or unenforceable) including all steps and transactions by which it is carried into effect. liability includes a potential or prospective liability in respect of future royalty. royalty avoidance includes: (a) directly or indirectly altering the incidence of any royalty; and (b) directly or indirectly relieving any person from liability to pay royalty; and (c) directly or indirectly avoiding, reducing or postponing any liability to royalty. (2) An arrangement made or entered into, whether before or after the commencement of this Act, shall be absolutely void as against the Secretary for royalty purposes if and to the extent that, directly or indirectly: (a) its purpose or effect is royalty avoidance; or (b) where it has 2 or more purposes or effects, one of its purposes or effects (not being a merely incidental purpose or effect) is royalty avoidance, whether or not any other or others of its purposes or effects relate to, or are referable to, ordinary business or family dealings, whether or not any person affected by that arrangement is a party thereto.

Part I Preliminary Mineral Royalty Act 1982 23 (3) Where an arrangement is void under subsection (2) the value of any mineral commodity, asset or debt of a production unit affected by that arrangement shall be adjusted in such manner as the Secretary considers appropriate so as to counteract any royalty advantage obtained in respect of that production unit from or under that arrangement. (4) Without limiting the generality of subsection (3), the Secretary may, in making an adjustment under that subsection, have regard to the royalty that, in his or her opinion, would have, or might be expected to have or would in all likelihood have, been paid in respect of a production unit if the arrangement had not been entered into. (5) Nothing in this section shall apply to an arrangement made in conformity with guidelines promulgated under section 4E or the opinion of the Secretary under section 4F. 5 Secretary to determine certain matters (1) The Secretary may determine the extent to which a particular expenditure is to be attributed to a particular category of eligible deduction in calculating the royalty payable by a royalty payer and, upon the determination being made, that particular expenditure shall be attributed accordingly. (2) If the activities of a royalty payer on or in relation to a production unit are activities which, in the opinion of the Secretary, are not directly related to the production of a saleable mineral commodity by that production unit but which would otherwise attract eligible deductions, the Secretary may, for the purpose of calculating the royalty payable by the royalty payer, apportion the expenditure between the activities directly related to the production of a saleable mineral commodity and those other activities, as the Secretary thinks fit. (3) The Secretary may determine that an amount claimed by a royalty payer to reduce the payer's gross production revenue: (a) is more appropriately classified as a deduction under section 10(2); and (b) is not to be taken into account in determining the gross production revenue.