EDITORIAL — SPECIAL REPORT

RESOURCE SOVEREIGNTY & GOVERNANCE REVIEW

EXTRACTIVE INDUSTRIES · TAX POLICY · NATIONAL SOVEREIGNTY

The Invisible Transfer:

How Guyana’s Governance Gaps Give Away Strategic Resources

When a uranium deposit changes hands in Singapore, Guyana collects nothing. This is not an accident— it is a system working exactly as poorly designed systems do.

MAY 2026 · SPECIAL EDITORIAL · TAX & RESOURCE GOVERNANCE

The acquisition of Guyana’s only uranium project by Canadian firm U92 Energy Corp.—executed through the purchase of Singapore-registered LIA Industries Pte.

Ltd.—did not merely expose a gap in one law. It illuminated the outline of a governance architecture that was never built. What the country faces is not a single loophole to be patched; it is a structural condition in which the legal, regulatory, and fiscal scaffolding around its extractive sector lags dangerously behind the sophistication of those who exploit it.

The mechanism here is neither novel nor obscure. It is a well documented instrument in the global extractive industry: the indirect transfer of resource assets through offshore holding companies. Instead of selling the Guyanese asset directly—which would trigger domestic tax obligations—a company sells the foreign entity that owns the asset. The asset never formally moves. Only the bene9cial owners change. And so, from Guyana’s current legal vantage point, nothing taxable occurred on its soil at all.

The Kurupung uranium project—spanning over 90 square kilometers with an estimated 20.6 million pounds of uranium in the ground—changed hands without the State capturing a single dollar in transfer taxes, capital gains tax, or windfall levies. In a world increasingly turning toward nuclear energy as a low carbon baseload solution, uranium is not merely a mineral. It is a strategic asset. And Guyana appears to have had no seat at the table when its ownership was reassigned.

“The DRC did not even know it was happening, despite owning a 20% equity stake in the project. The acquisition occurred entirely onshore, through a Bermuda holding company, and the country received nothing.”

COLUMBIA CENTER ON SUSTAINABLE INVESTMENT, ON THE $2.65 BILLION TENKE FUNGURUME COPPER MINE SALE, 2016

Guyana is not alone in this vulnerability—but the global precedents make inaction all the more inexcusable. The Democratic Republic of Congo watched as Freeport McMoRan sold its 56% controlling stake in one of its largest copper mines to China Molybdenum through a Bermuda holding company for $2.65 billion, receiving nothing in return. The DRC did not even know the transaction was occurring. If that scale of loss is possible in a country with a 20% equity stake and formal operator relationships, consider what is possible in a country where the regulatory regime is still being assembled.

1.The Anatomy of an Indirect Transfer

To understand the full scope of the problem, one must understand how these transactions are structured. A mining or resource company wishing to exit a project in a developing country has two broad options: sell the underlying asset directly or sell the shares in a company that holds that asset. The first route is visible, taxable, and open subject to regulatory approval in the host country. The second route—the indirect transfer—occurs in a foreign jurisdiction, sometimes involving multiple layers of holding companies across multiple tax havens.

In Guyana’s case, LIA Industries Pte. Ltd., incorporated in Singapore, held the prospecting license for the Kurupung uranium project. When U92 Energy Corp. acquired LIA Industries, it acquired Guyana’s uranium project. But legally, what was sold was a Singapore company. Singapore received whatever taxes were applicable there. Guyana received none.

The Platform for Collaboration on Tax—a joint body of the IMF, OECD, UN, and World Bank—has articulated the foundational principle clearly: direct and indirect asset transfers that represent the same transfer of ownership should attract the same tax treatment. Otherwise, the incentive structure actively encourages offshore structuring to avoid the host country’s fiscal claim.

This is precisely what Guyana’s current framework incentivizes. The country’s tax legislation does not contain provisions to “look through” the offshore holding structure and assert fiscal jurisdiction over gains derived from the underlying Guyanese resource. The result is a system in which the more creative the corporate structure, the less the country collects.

The UN Handbook on Selected Issues for Taxation of the Extractive Industries—a dedicated technical resource for developing countries— identifies indirect asset transfers as a discrete and serious challenge, dedicating an entire chapter to the design of legal responses. Guyana does not yet appear to have translated that guidance into legislative action.

COMPARATIVE CASE

How Tanzania Closed the Gap

Tanzania’s Mining Act and Income Tax Act were amended to treat indirect transfers of mining rights as taxable events, requiring notification and withholding, regardless of where the transaction occurs. The triggering criterion is whether the underlying asset derives its value principally from Tanzanian resources. Similar “principal value” tests have been adopted across Africa and Asia.

Countries including Tanzania, Uganda, Ghana, India, China, and Peru have each, in their own ways, enacted legislation that either taxes indirect transfers directly, requires their notification, or subjects them to approval conditions. Guyana has none of these protections.

“$2.65B

DRC COPPER MINE SOLD OFF SHORE

0 TAXES TO HOST COUNTRY

20.6M

LBS OF URANIUM

ESTIMATED AT

KURUPUNG —

TRANSFERRED WITHOUT

GUYANA AT THE TABLE

GUYANESE TAX DOLLARS

CAPTURED FROM THE

U92/LIA INDUSTRIES

TRANSACTION

11.A License Is a Public Asset. It Must Be Treated as One.

At the center of this transaction lies a prospecting license—a legal right granted by the Guyanese State to explore and potentially extract a mineral resource that belongs, constitutionally, to the people of

Guyana. It is not a private property right that can circulate freely in commercial channels without State involvement. It is a delegated public right, granted conditionally, revocable in principle, and tied to specific obligations of the licensee.

Yet the practical reality is that this license has now passed to new beneficial owners—U92 Energy Corp. and its principals—without any formal regulatory approval process specific to the change of control. The license was not transferred. The company holding it was simply sold abroad. And because the license nominally remains in the name of LIA Industries Pte. Ltd., no formal transfer of license was triggered.

This is the second tier of the governance failure: the disconnect between formal legal title and actual beneficial control. Guyana’s licensing framework does not appear to contain provisions requiring the disclosure or approval of indirect changes of control over license holding entities. The company on the license remains the same; only who owns that company has changed.

Many jurisdictions have corrected this through what are known as change-of-control provisions in their mining or petroleum legislation. These require that any transaction—whether a direct sale of the license or an indirect acquisition of the controlling interest in the license holder—constitutes a triggering event requiring regulatory notification, review, and in some cases, approval or payment of a transfer fee.

The absence of such provisions in Guyana creates a dangerous parallel reality: on paper, a State-issued license remains in the hands of the original licensee; in practice, an entirely different set of principals now controls the economic destiny of that resource.

The implications extend beyond taxation. Questions of beneficial ownership transparency, national security vetting, environmental liability, and regulatory accountability all hinge on knowing who actually controls a resource asset. If that information can be withheld through offshore corporate structuring, the State is not merely losing revenue—it is losing oversight itself.

“If a company can change hands abroad and automatically retain control of a Guyanese license, then the State has electively relinquished control over who exploits its resources.” — THE PRECIPITATING EDITORIAL ON THE U92 ACQUISITION

III Uranium Is Not Gold. The Governance Stakes Are Higher.

There is a tendency in resource governance debates to treat all extractive commodities similarly. The Kurupung transaction demands a more differentiated analysis. Uranium is not gold. It is not bauxite. It is not even crude oil, despite that industry’s own considerable governance complexities.

Uranium is a dual-use material with applications in both civilian energy generation and nuclear weapons development. Its extraction, processing, and trade are subject to international regulatory regimes— including the International Atomic Energy Agency’s safeguards framework—that impose obligations on both states and operators. The identity, affiliations, and security clearances of uranium operators are not merely commercial questions. They are national security questions.

Guyana enters this sector with what the government has itself acknowledged: no other uranium projects, no established regulatory framework, and no domestic experience with the specific hazards and obligations that uranium extraction entails. That context does not make the resource less valuable—the global nuclear energy renaissance, driven partly by decarbonization commitments, may make Guyanese uranium considerably more valuable over the coming decades. But it does make the governance deficit considerably more dangerous.

There are four distinct dimensions of risk that Guyana must now navigate simultaneously with respect to Kurupung:

Radiological and Environmental Risk: Uranium extraction generates radioactive tailings and contaminated water that, if improperly managed, can persist in the environment for centuries. Guyana’s Environmental Protection Agency and Geology and Mines Commission must have the technical capacity to monitor, inspect, and enforce environmental standards specific to uranium—a very different challenge from gold or bauxite oversight.

Geopolitical and Security Risk: The identity of the ultimate beneficial owners of a uranium license matter. International safeguards regimes require states to account for nuclear materials within their territory. If Guyana cannot identify who controls its uranium resource at any given time, it may struggle to meet its international reporting obligations—let alone its national security interests.

Regulatory Capacity Risk: The sector is genuinely new to Guyana. Neither the institutional expertise nor the specialized regulatory instruments required for uranium governance have been established. The country is, in effect, being asked to regulate something it has never encountered before—and it is being asked to do so retroactively, after ownership has already changed hands.

Fiscal Sovereignty Risk: As with all extractive commodities, uranium’s fiscal contribution to Guyana will depend almost entirely on the quality of the fiscal regime that governs it—including royalties, profit taxes, ring-fencing provisions, and yes, taxes on indirect transfers. If those instruments are not in place before production begins, they become extraordinarily difficult to introduce without triggering investor disputes.

The window for proactive governance is open. It will not remain so indefinitely. Once exploration advances toward development, and once financial commitments compound, the political economy of reform shifts sharply away from the State.

1v The Systemic Failure: Oil Was the Warning, Uranium Is the Test

The U92 acquisition did not occur in a vacuum. It occurred against the backdrop of Guyana’s ongoing—and extensively documented—struggles to capture adequate fiscal returns from its petroleum sector. The country’s oil contracts, negotiated under the Stabroek block regime, have been widely criticized by international fiscal governance experts for royalty rates, cost recovery provisions, and ring-fencing structures that limit the State’s take. These were not the product of malice; they were the product of a negotiating context in which the State had less information, less capacity, and less leverage than its counterparts.

The pattern matters: resource sectors tend to be governed by the frameworks that existed at the time of the first major transaction, not the frameworks that should have existedBy the time the scale of the asset is understood, the contracts are signed, the precedents are set, and the cost of renegotiation—financial, diplomatic, and political—is prohibitive.

Guyana is now receiving a second notice. The uranium sector is embryonic. There are no production-stage contracts. There are no entrenched investors with sunk capital claiming sovereign protection for existing arrangements. The cost of reform at this stage is political will and legislative time—considerably cheaper than the cost of reform after the fact.

The IMF, in its own assessments of developing country resource governance, has consistently flagged indirect transfer taxation as one of the areas where developing countries leave the most revenue on the table. The mechanism is technically understood. The legislative models are available. The question is whether Guyana’s institutions will act on the evidence before the window closes.

The answer to that question will say something lasting about the country’s capacity to govern its resource wealth in the interest of its citizens—not just in uranium, but in whatever comes next.

THE GLOBAL PRECEDENT — INDIA’S GENERAL ANTI-AVOIDANCE RESPONSE

When Vodafone Sued India for $2 Billion — and India Rewrote the Law

In 2012, India’s Supreme Court ruled that the government could not tax Vodafone’s acquisition of an Indian telecom business through a Cayman Islands holding company. The transaction—valued at $11 billion—had been structured to route control of the Indian asset through a foreign entity, placing it outside India’s tax jurisdiction. The Supreme Court agreed with Vodafone. India’s Parliament then amended the Income Tax Act retroactively to assert jurisdiction over indirect transfers of assets whose value is substantially derived from Indian sources. The lesson: waiting for litigation is the most expensive way to reform. Guyana should not need a billion-dollar case to prompt action.

What Reform Must Look Like

Reform in this area is achievable. It is technically understood, internationally precedented, and—at this stage of Guyana’s extractive sector development—politically feasible. The following measures constitute a minimum legislative and regulatory agenda, not an aspirational wish list.

01 LEGISLATE INDIRECT TRANSFER TAXATION

Amend the Income Tax Act to assert Guyana’s fiscal jurisdiction over gains derived from the indirect transfer of assets whose value is principally derived from Guyanese resources. The “principal value test”—requiring that at least 50% or 75% of the entity’s value be attributable to local resource assets—is the standard adopted by Tanzania, Uganda, India, and others. This closes the Singapore-Singapore sale scenario entirely.

02 MANDATE CHANGE-OF-CONTROL NOTIFICATION AND APPROVAL Amend the Mines Act and relevant petroleum legislation to require that any change in the ultimate beneficial ownership of a license-holding entity—direct or indirect—constitutes a triggering event requiring notification to the Guyana Geology and Mines Commission and, for strategic resources, Ministerial approval. This closes the “same license, new owners” loophole.

03 ESTABLISH BENEFICIAL OWNERSHIP REGISTERS FOR LICENCE HOLDERS

All companies holding prospecting or mining licenses in Guyana must file and maintain current beneficial ownership

information, updated within 30 days of any change of control. This registry should be accessible to relevant regulatory bodies and, where national security is implicated, to intelligence agencies. Beneficial ownership transparency is the prerequisite for all other oversight.

04 DEVELOP A DEDICATED URANIUM REGULATORY FRAMEWORK The Kurupung project cannot be adequately governed under generic mining legislation. A sector-speci5c regulatory framework for uranium—covering radiological safety, tailings management, IAEA safeguards compliance, export controls, and security vetting of operators—must be developed before exploration advances toward development stage. Guyana should engage directly with the IAEA’s technical cooperation

programmes to build this capacity.

05 CONDUCT AN IMMEDIATE FISCAL REGIME REVIEW FOR THE URANIUM SECTOR

Before any development licenses are considered for Kurupung, the Guyana Revenue Authority and Ministry of Finance should commission an independent fiscal regime analysis for uranium, benchmarking royalty rates, profit taxes, ring-fencing

provisions, and stability clause frameworks against comparable jurisdictions. This analysis should be public and should precede —not follow—any negotiation with the license holder.

06 REVIEW ALL EXISTING LICENCES FOR UNDISCLOSED INDIRECT TRANSFERS

The U92 acquisition is unlikely to be the only instance of indirect transfer affecting Guyanese resource licenses. A comprehensive audit of all active prospecting and mining licenses, verifying current beneficial ownership against original applicant identity, would reveal the scope of the problem and inform legislative priorities.

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There is a phrase that recurs in resource governance literature: “the resource curse is not inevitable—it is a policy choice Countries do not become cursed by oil or gold or uranium. They become cursed by the

institutional arrangements they fail to build before extraction begins, and by the political environments that make reform feel impossible once the money starts =owing.

Guyana is not cursed. It is, in fact, one of the few countries in the world that has received clear, repeated, well-documented warnings about the governance gaps in its extractive sector—and still has the time and political space to address them. The oil sector’s fiscal architecture is imperfect but established; reforming it now is difficult. The uranium sector has no such entrenched architecture yet. The cost of building it correctly today is a fraction of the cost of renegotiating it under duress tomorrow.

The U92 acquisition is not primarily a story about one company, one project, or one transaction. It is a story about what a State owes its citizens when it grants away the right to their natural inheritance. That inheritance does not belong to whoever is clever enough to structure around the rules. It belongs to the people of Guyana. The only question is whether their government will act in time to protect it.

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