Centerra Gold Comments on Tax Claims Received from Kyrgyz Authorities
1 University Avenue, Suite 1500
Toronto, ON
M5J 2P1
tel 416-204-1953
fax 416-204-1954
www.centerragold.com
NEWS RELEASE
Centerra Gold Comments on Tax Claims Received from Kyrgyz Authorities
Toronto, Canada, March 18, 2021: Centerra Gold Inc. (“Centerra”) (TSX: CG) comments today on tax claims
received by its Kyrgyz Republic subsidiary, Kumtor Gold Company CJSC (“KGC”), from the Kyrgyz Republic
State Tax Service.
The claims include: (i) a claim for approximately U.S.$106 million related to withholding taxes on dividends
paid to its direct parent company, Centerra, during the years 2016 and 2017; and (ii) a claim for approximately
U.S.$17 million related to payroll deductions not withheld by KGC on certain national employee compensation
during the years 2016 and 2017. Each of these claims was initially raised by the State Tax Service in 2018 but
subsequently withdrawn or terminated pursuant to decisions of the State Tax Service in March 2018. The State
Tax Service has now annulled its previous decision in order to revive such claims. The State Tax Service has
also made a claim against KGC for approximately U.S.$23 million in relation to payments to the Kyrgyz
Republic Social Fund during the years 2011 through 2017. Again, such a claim is in direct contradiction to the
conclusions of the State Tax Service itself from previous years which confirm that Kumtor Gold Company had
no outstanding Social Fund payments . The amounts of each of the foregoing claims include significant
penalties and / or sanctions assessed by the State Tax Service, in some cases more than half of the total amount
claimed.
Centerra notes that the 2009 restated project agreements which govern the Kumtor Mine contain a specific tax
and fiscal regime applicable to the Kumtor Mine. That tax and fiscal regime provides, among other things, that
no taxes are payable by KGC on intercompany transactions with Centerra, including dividends.
The Company is studying the claims but believes they are exaggerated or without merit. KGC has also received
requests from the State Tax Service to re-audit KGC’s financial accounts for 2014 through 2019. The Company
is disputing the State Tax Service’s ability to carry out such re-audits.
The Company has benefited from a close and constructive dialogue with the Kyrgyz Republic authorities over
many years and remains committed to continuing to work with them to resolve these any outstanding issues in
accordance with the 2009 restated p roject agreements applicable to the Kumtor Mine , which provide for all
disputes to be resolved by international arbitration, if necessary. However, no assurances can be given that the
current or future claims of the State Tax Service or the outcome of the State Commission review can be resolved
without a material impact on the Company. As previously disclosed, in February 2021, a State Commission
was formed by the Kyrgyz Republic Parliament to, among other things, review the performance of the Kumtor
Mine and to review the results of a previous 2012 Kyrgyz Republic State Commission. For further information
relating to the current State Commission and the legal matters arising out the 2012 State Commission, see
Centerra’s most recent Annual Information Form dated March 15, 2021.
About Centerra
Centerra Gold Inc. is a Canadian-based gold mining company focused on operating, developing, exploring and
acquiring gold properties in North America, Asia and other marke ts worldwide and is one of the largest
Western-based gold producers in Central Asia. Centerra operates three mines, the Kumtor Mine in the Kyrgyz
1 University Avenue, Suite 1500
Toronto, ON
M5J 2P1
tel 416-204-1953
fax 416-204-1954
www.centerragold.com
2
Republic, the Mount Milligan Mine in British Columbia, Canada and the Öksüt Mine in Turkey. Centerra's
shares trade on the Toronto Stock Exchange (TSX) under the symbol CG. The Company is based in Toronto,
Ontario, Canada.
For more information:
John W. Pearson
Vice President, Investor Relations
(416) 204-1953
Additional information on Centerra is available on the Company’s web site at www.centerragold.com
and at SEDAR at www.sedar.com.
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