In the northeastern region of the Democratic Republic of Congo (DRC), authorities have announced legal proceedings against a subcontracting company engaged by the Canadian firm Kibali Gold Mine, accusing it of violating subcontracting laws.
The subcontracting law stipulates that only companies with a majority of Congolese capital (at least 51%) can operate in the subcontracting sector. Consequently, authorities claim that Kibali Gold Mine, a major gold mining operator in the DRC, established a front company to disguise itself as a subcontractor for its production and supplies.
According to competent authorities, for years, millions of dollars have been funneled out of the Congolese financial system through a foreign company, TCFF, which changed names over the years. This Belgium-Indian company managed 90% of the subcontracting contracts for the Kibali Gold Mine in the Haut Uélé province.
“TCFF is the former FFK,” explains Miguel Katemb Kashal, the director-general of ARSP, the subcontracting regulatory body. “When the public denounces, they change their name, but it’s always the same individuals. It is unequivocally concluded that TCFF is nothing more than Kibali Gold in disguise. Legal action must be taken. This should serve as a lesson to others.”
Christophe Baseane Nanga, the governor of Haut Uélé, is firm in addressing major companies justifying the use of 100% foreign capital by pointing to a lack of competence in Congolese enterprises in certain areas: “It’s an issue of sharing dividends with the Congolese. Our province will not refuse to reclaim the 51% of profits that this company has generated here.”
According to ARSP, these funds evade the Congolese system either through this front-company system or by utilizing foreign capital companies that enable payments outside the country. The legal action signals a pivotal move in holding accountable those allegedly exploiting legal loopholes to the detriment of Congolese interests.