Severstal : Report on Payments to Governments in 2019
06/03/2020 | 04:06am EDT
• This Report on payments to governments ("the Report") is prepared in accordance with the requirements of the Disclosure and Transparency Rules Instrument 2014 «Report on payments to governments», issued by the Financial Conduct Authority (FCA's Instrument). As FCA's Instrument has multiple references to the Accounting Directive(Directive 2013/34/EU of 26 June 2013 on the annual financial statements) the Report is prepared in accordance with Chapter 10 of the Accounting Directive.
• PAO Severstal ("Severstal" or "the Company") is obliged to prepare the Report under the requirements of FinancialConduct Authority since Severstal conducts extractive activities around the world and its GDR are traded on London Stock Exchange.
•The Report is published on the official site of Severstal and can be found inInvestor relationssection.
Basis for preparation the Report for FY2019
•The Report provides citizens, authorities and independent users with the information on payments made to governments where Severstal conducts its extractive activities.
•Payments are reported in respect of extractive activities only. For the purposes of this Report under extractive activities it is understood any activity involving the exploration, prospection, discovery, development and extraction of minerals.
•For the purposes of this Report payments per governments (federal, regional or local) are disclosed.
•There were no payments per entity or project made in 2019. For the purposes of this Report under projects it is understood a single contract, license, concession or similar legal agreements, which forms the basis for payment liabilities.
•Payments are broken down by governments only.
•For the purposes of the Report preparation the scope of companies is the same as in consolidated financial statement of Severstal.
According to Chapter 10 of the Accounting Directive 2013/34/EU of 26 June 2013 the following types of payments are in scope:
•Production entitlements.These are host government's share of production in the reporting period derived from projectsoperated by a company.There were no such payments made in 2019.
•Taxes levied on the income, production or profits of companies.These payments include corporate income tax, mineral extraction tax, flat and surface tax. Taxes on consumption such as VAT, sales taxes, customs and stamp duties, personal, social, property and environmental taxes, land tax as well withholding taxes are excluded.Royalties.There were no such payments made in 2019.
•Dividends.These are payments made by a company to a government in lieu of production entitlements or royalties, where the government is an ordinary shareholder of that company.
•Bonuses.These are payments made by companies to a host country upon signing an agreement or contract, or uponachievement of certain levels of production (stated in agreement or contract).There were no such payments made in 2019.
•License fees, rental fees, entry fees and other considerations for licenses or concessions. These are payments for the access to the area where extractive activities will be performed.
•Payments for infrastructure improvements. These are payments made by a company to governments in the form of infrastructure expenditure (e.g. building a road or a bridge), excluding any voluntary contributions and charity payments.Payments for infrastructure improvements may be in the form of "in-kind payments".
•The Report include payments that are above100,000 EUR only.
•Voluntary contributions and charity payments are disclosed by Severstal in the Sustainability Report.
• There were no "in-kind payments" made in2019.
•The Report is prepared inEUR.Payments made in currencies other than EUR were translated based on the average exchange rate for 2019 which is72,50 RUB/EUR.
•The payments reflected in this report were made in the Russian Federation.
•Corporate income tax is shown as a sum of payments both within and without consolidated group taxpayer. Severstal CGT consists of 25 companies and payments from the CGT include income tax from non-extractive activities.
Payments Broken Down by Governments and Type of Payments
Payments to governments above 100,000 EUR (in currency)Type of payments
Federal governmentRegional governmentLocal governmentState owned company
Taxes levied on income, production or profits of companies:
Corporate Income Tax*
Mineral Extraction Tax
One-time payments for the use of sub-surface resources (bonuses)
Regular payments for the use of sub-surface resources (rentals)
Bonuses (signature, discovery, production)
License fees, rental fees, entry fees and other considerations
Payments to infrastructure improvements
11,253,118 € 1,386,228 €
294,643,992 € 16,905,765 € 2,079,343 €
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348,317,824 € 28,158,883 € 3,465,571 €
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