Serbia-focused Tethyan Resources has announced that it will redomicile the company from England and Wales to British Columbia, Canada, to avoid the UK stamp duty tax.
The UK stamp duty tax – a tax of 0.5% payable to HM Revenue and Customs Stamp Office – is unfamiliar to many investors that purchase shares of UK-domiciled public companies that are listed on the TSX-V and as a result creates an unexpected transaction cost.
“This stamp duty tax obligation places Tethyan at a disadvantage compared to non-UK-domiciled public exploration companies when attracting investors to purchase existing shares of the company,” the exploration and development firm said on Tuesday.
Redomiciling will be effected through the change of the corporate structure of Tethyan and its subsidiaries by establishing Tethyan Resource (New Tethyan), a new Canadian-incorporated parent company, at the head of the group. Tethyan has applied to the TSX-V to list the New Tethyan shares for trading on the exchange.
In September 2017, Tethyan’s shares commenced trading on the TSX-V and, subsequently, the company delisted its shares from the Aim market of the LSE.
“The proposed redomiciling is consistent with our expanding international shareholder base, and better positions us to realise our strategic goals. We recently completed a successful financing led by a North American institution, and are well capitalised for our 2019 exploration programme,” said CEO Jerrold Annett.
The company has also simplified its capital structure by acquiring and cancelling the legacy non-voting deferred shares that were no longer serving a purpose.