Several Congolese newsrooms, including those of the Consortium composed of EcoNews, Congo Nouveau, Leader, Mining News Magazine, have learned from the MOMENTUM firm headed by Me Christian Lukusa that there will be a hearing at the Lubumbashi Commercial Court (TRICOM) this Monday, March 25, 2024, on the request of the public company La Cominière headed by Mr. Kibeya Célestin, who insists on the departure of AVZ Minerals and Dathomir from Simon Cong and the Guy Loando family – request registered under RAC 3268 – for the dissolution of Dathcom Mining SA, the partnership company with the Australian group AVZ Minerals at the heart of the irregular battle with the Chinese of Zijin, supported by La Cominière and Dathomir, for control of the large lithium deposit of Manono.
According to Congolese civil society NGOs that have been closely following this case since 2021, the proceedings before the Commercial Court of Lubumbashi by two co-shareholders of Dathcom are in violation of the decisions of the international arbitration taken in Paris and Washington against La Cominière, Dathomir and Zijin in favour of Dathcom Mining and the Australian group AVZ Minerals.
Indeed, AVZ prevailed in the ICSID interim measures.
The Australian Company, through its subsidiaries AVZ International Pty Ltd (AVZI) and Green Lithium Holdings Pty Ltd (GLH), as well as Dathcom Mining SA (Dathcom), previously initiated international arbitration proceedings against the Democratic Republic of Congo (DRC) under its Mining Code and the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention) before the International Centre for Settlement of Investment Disputes (ICSID) in Washington (see ASX announcement of June 9, 2023, “Confirmation of Registration of Request for ICSID Arbitration Proceedings against the Democratic Republic of Congo”).
On December 11, 2023, the ICSID tribunal heard the application for interim measures by AVZI, GLH and Dathcom, including an urgent order to preserve the status quo and an order to confirm or restore ownership of Research Permit (PR) 13359 to Dathcom (see ASX announcement dated November 15, 2023 “ICSID Proceedings Update”).
On January 16, 2024, AVZ announced that the ICSID tribunal (in Washington) had issued interim orders directing the DRC to take the necessary steps to reflect Dathcom’s ownership of PR 13359 and to protect the rights of AVZI, GLH, and Dathcom pending the outcome of the proceedings (interim orders). The ICSID tribunal’s decision to grant interim measures is an interim ruling. It does not imply any final determination of the merits of the case, which remain to be determined in the substantive proceedings.
Interim Orders Applicable to All
The interim orders in question, which are binding on everyone and on the entire Congolese judicial system, including the Lubumbashi Commercial Court, and on all Congolese administration, are as follows and stipulate that the Democratic Republic of Congo (DRC) must:
• Reinstate Dathcom as the holder of PR 13359, currently being converted into an operating permit, within the area mentioned in Article 2 of Ministerial Order No. 0921/CAB. MIN/MINES/01/2016 of December 28, 2016, but excluding the area covered by PR 15775; Task the Mining Cadastre of the DRC (CAMI) with rectifying the map of mining benefits to reflect Dathcom’s ownership of PR 13359 within an area excluding the area covered by PR 15775, specifying that this permit is being converted into an operating permit and that it remains valid;
• Take the necessary measures to guarantee the integrity of Dathcom’s installations and equipment within the perimeter of PR 13359 as mentioned in Article 2 of Ministerial Order No. 0921/CAB. MIN/MINES/01/2016 of December 28, 2016, but excluding the perimeter covered by PR 15775, as well as the drill cores stored there, until the installation, equipment and drill cores are taken into possession;
• To preserve the confidentiality of all technical, geological and mining information provided by Dathcom to the Ministry of Mines, to the Congolaise d’Exploitation Minière (Cominière) and to CAMI within the framework of its activities under the title of PR 13359, on the entire perimeter of PR 13359 as referred to in article 2 of ministerial decree n°0921/CAB. MIN/MINES/01/2016 of 28 December 2016 (including the perimeter referred to by PR 15775), by taking all necessary measures for this purpose;
• Allow the applicants, within 19 days, to establish a joint inventory of the file held by CAMI relating to PR 13359 over the entire perimeter of PR 13359, as mentioned in article 2 of Ministerial Order No. 0921/CAB. MIN/MINES/01/2016 of December 28, 2016 (including the perimeter now covered by PR 15775), up to the date on which the PR 15775 request was made, and to take a copy of this file;
• To refrain from taking, whether through its officials, bodies, emanations or companies (including Cominière, without prejudice to the nature of the links between the DRC and Cominière), any new action likely to call into question PR 13359 or that could lead to an aggravation of the present dispute or deprive the future final judgment of its effects; and
• Do not exclude Dathcom’s access to the Mpiana Mwanga power plant.
Contrary to the claims and initiatives of La Cominière, Dathomir and Zijin with the Congolese justice system, it is appropriate to remind all parties involved in this case, particularly the administration and the judicial system of the country, that the interim orders are binding on all parties and take effect immediately, but can only be reviewed (or revoked) by the ICSID tribunal (not a Congolese court or administration) in light of the comments provided by AVZI, GLH and Dathcom and the State.
The binding nature of the interim orders was reaffirmed and emphasized by the ICSID tribunal in its decision. Among other directives, the ICSID tribunal requested Dathcom to expressly confirm that if the DRC complied with these interim orders, AVZI, GLH, and Dathcom would request the release of the project owner, and that if the DRC released him, they would immediately advance the project’s development. The Australian group AVZ Minerals will take the necessary steps to obtain this confirmation from AVZI, GLH, and Dathcom.
Although the interim orders require the State to take the necessary steps to register Dathcom as the holder of PR 13359, they do not undo the transfer by La Cominière Cominière of the northern portion of PR 13359 in October 2023 or the immediate subsequent grant of PR 15775 to Manono Lithium SA. The ICSID tribunal declined to rule on the title to the northern area on an interim basis, as this could affect the interests of a third party to the proceedings (namely Manono Lithium SA), which will be definitively addressed in the broader ICSID proceedings.
AVZ Minerals considers that the illegality of the transfer of PR 13359 from Dathcom to La Cominière, which was cancelled under the interim orders, also makes illegal the transfer by La Cominière of the northern part of PR 13359 and the subsequent granting of PR 15775 to Manono Lithium SA.
Accordingly, the Australian Company will continue its efforts to confirm its and Dathcom’s ownership of the northern area of the Manono project, either by continuing its negotiations with senior officials of the DRC government, or by pursuing the ICSID and ICC procedures to their conclusion.
International arbitration finds Jin Cheng (Zijin) at fault and rules in favor of AVZ Minerals
Although La Cominière and Dathomier may claim to give other reasons why they want the dissolution of Dathcom Mining SA, which they have voluntarily blocked through irregular acts, all those who follow this case know that the refusal of Dathcom Mining’s management to register Zijin’s subsidiary as a shareholder of Dathcom, after the sale of shares by La Cominière deemed illegal and criminally punishable by a report incriminating the General Inspectorate of Finance, dependent on the Presidency of the Republic, with the support of the Minister of Portfolio Adèle Kayinda, is the real cause that has been pushing these two accomplices in wrongdoing – having blocked the development of Manono – in their battle against AVZ Minerals and Dathcom Mining for some time.
However, during this month of March 2024, AVZ Minerals prevailed in the judgment concerning the ICC arbitration proceedings (ICC case no. 26986/SP/ETT) initiated by Jin Cheng Mining Company, a subsidiary of Zijin Mining Limited (Jin Cheng), against AVZ International Pty Ltd (AVZI) regarding an alleged abuse of majority in relation to AVZI’s failure to recognize the sale by La Congolaise d’Exploitation (Cominière) to Jin Cheng of 15% of the shares in Dathcom Mining SA (Dathcom).
On March 15, 2024, the ICC (International Chamber of Commerce) International Arbitration Tribunal ruled in favor of AVZ Minerals, stating that for the purposes of jurisdiction, Dathcom’s shareholder status is determined by its registration in Dathcom’s internal share register and that the ICC tribunal was not competent to preside over the proceedings initiated by Jin Cheng.
The ICC tribunal ruled that Jin Cheng’s recourse to arbitration was unjustified and ordered Jin Cheng to reimburse AVZI USD 75,000 for its arbitration costs and AUD 813,474 for its legal costs, and to bear its legal expenses (over €3 million). This contradicts what La Cominière wrote about X, stating that AVZ lost, even though legal expenses are always borne by the losing party, which in this case was Jin Cheng.
The decision is entirely consistent with the position defended by AVZ Minerals, namely that it holds a clear legal title to a 75% stake in Dathcom Mining and a continuing right of first refusal on 15% of La Cominiere’s 25% stake in Dathcom Mining.
The ICC tribunal did not rule on the validity of Cominière’s alleged sale to Jin Cheng of 15% of Dathcom’s shares, which the Australian group claimed violated AVZI’s right of first refusal and was tainted by corruption. These issues, particularly those relating to corruption, will be re-examined in other ICC proceedings, including the case brought by AVZI concerning Cominière’s alleged breaches of the Dathcom joint venture agreement (ICC No. 27720/SP).
According to a statement from the Australian company, AVZ Minerals has taken note of Zijin’s public declaration that, in light of the failure of its proceedings before the ICC, it will now seek to pursue this claim through internal proceedings in the DRC. AVZ Minerals is considering its appropriate response to this latest threat.
This award is another positive result for AVZ and Dathcom Mining, which comes on top of the two emergency arbitrator orders issued against La Cominière in ICC case No. 27720/SP, and the provisional orders issued by the ICSID tribunal in ICSID case No. ARB/23/20 C No. 27720/SP to protect in particular Dathcom Mining’s rights to PR 13359 which La Cominière and Zijin want to divide up in favor of Manono Lithium, their partnership company which they want to see replace Dathcom Mining on a deposit documented by the Australian group AVZ.
AVZ Minerals’ board of directors believes that this decision gives a significant additional impetus to a negotiated outcome that the Australian group has been proposing since 2021 to various officials in the country with a view to developing the project in compliance with international standards in the mining sector and the obligations of listed companies for the benefit of shareholders, those of the DRC and the local communities of Manono who are eagerly awaiting the Dathcom Mining Exploitation Permit, according to statements made by the high chief of the Luba-Bakongolo during the site visit to Manono in July 2022 to investigators from EcoNews, Kin24, Top Congo FM, Mining News Magazine and other media as well as representatives of Congolese NGOs.
By Oktober Luchane and the Consortium
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