52197
PUBLIC RECORD OFFICE
Reference :-
HC.O. 885
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
15 PUBLIC RECORD OFFICE, LONDON
No. 174.
(NORTHERN NIGERIA.)
LAW OFFICERS to COLONIAL OFFICE.
[Rights of the Government and the Royal Niger Company as regards minerals in Northern Nigeria.]
SIR,
Royal Courts of Justice,
December 18, 1902.
We were honoured with your commands signified to us by Mr. Antrobus in his letter of the 17th November last, stating that he was directed by you to inform us that, in connection with the revocation of the Royal Niger Company's Charter in 1899, an Agreement was concluded by the Chancellor of the Exchequer with the Governor of the Company, Sir George Goldie, under which it was arranged, among other things, that the Company should assign to Her Majesty's Government all its lands and mining rights of whatever sort and however acquired, and the Govern- ment should impose a royalty on all minerals which might be worked in a certain specified portion of Northern Nigeria provided that such minerals were exported from a British port or through a British Custom House, and further that the Govern- ment should pay to the Company or its assigns one-half of the receipts from any royalty so imposed for a period of 99 years, and that no specific taxation should be imposed on the mining interest as such which would prevent the imposition of such an amount of royalty as might be compatible with the development of that industry in the territories in question.
That this agreement was embodied in a Treasury Minute, dated the 30th of June, 1899, which was laid before Parliament.
That after the issue of the Treasury Minute, the Secretary to the Treasury received a letter,, dated the 29th of June, 1899, from the Governor of the Company, in which Sir George Goldie referred to paragraphs 9 and 10 of the Minute, and stated that he had informed the Council of the Company that the Government would not be entitled to sell mining Concessions otherwise than for royalties, as to do so would be to sell to the prejudice of the Company the capital value of interests expressly reserved to it; ' and that in replying on the 1st of July, 1899, to this letter, the Secretary to the Treasury stated that the Lords Commissioners could not give any undertaking not to grant mining Concessions otherwise than for royalties, but that it was the intention of the Minute, and that their Lordships undertook that the word "royalty" should be held to cover any profit (whether by sale or by the issue of licences) made by the Government in connection with the working of minerals within the district specified in the Minute, and that of such profit the Company should be entitled to one-half.
That steps were now being taken to develop the mineral resources of Northern Nigeria, and that a law had been passed to regulate the mining industry. That in this law, the Minerals Proclamation, 1902, it was provided (section 19) that duties on profits and royalties should be paid to the Government, and that in the Rules and Regulations made under this Proclamation it was further provided (paragraph 6) that certain fees should be paid for licences to prospect.
That on the 27th of March last a letter was addressed to the Niger Company. Limited, stating that it had become necessary to determine the amount of royalty to be imposed on minerals, and what specific taxation should be levied on the mining industry, and suggesting that it would be in the interest of all concerned that no royalty should be levied on output, but that its equivalent should be included in the proposed tax upon profits, and that there should be paid to the Company out of the proceeds of the tax a fixed proportion which might be agreed upon as fairly equivalent to what the Company might expect to derive from their share of any royalty which could pro- perly be levied under the original agreement.
That as it was understood from communications which had passed between the High Commissioner of Northern Nigeria (Sir F. Lugard) and the Company that there was some difference of opinion as to the meaning and substance of the agreement in respect of royalties, you consulted the Lords Commissioners of the Treasury, and that their interpretation of the agreement was set out in the second paragraph of the letter to the Company.
25 Wt 2757 12/02 D&8 & 19259