Ferrexpo Plc (LON:FXPO) has said that, following the Russian invasion of Ukraine, the Ukrainian government introduced Martial Law and the National Bank of Ukraine subsequently imposed significant currency control restrictions, including reducing the maximum settlement period for invoices under export and import contracts.
The Company and FPM has been notified that, following an unscheduled documentary internal review, without an on-site inspection, to assess FPM’s compliance with the aforementioned currency control regulations for the periods falling primarily between 1 July 2021 and 31 December 2025, the relevant tax authorities have issued a report, dated 14 July 2026, assessing a penalty against FPM in the total amount of approximately UAH 35.3 billion (approximately US$788 million).
FPM considers the review to be irregular on the grounds that it was conducted with multiple procedural violations and that the tax authority failed to consider relevant factual circumstances, including arbitration awards under several export contracts. Those awards procedurally preclude the imposition of penalties in respect of those contracts, which account for the majority of the penalty assessed.
FPM has filed formal objections to tax authority in connection with the report. If the objections are upheld, the findings of the report may be revised, including through a re-audit with on-site presence. If the tax authority does not amend the findings, it must issue tax notices-decisions ("TNDs") setting out the amount of the penalty. FPM intends to challenge any such TNDs through administrative proceedings before the tax authority and/or the Ukrainian courts. Pending the completion of the administrative and/or judicial review process, the financial liabilities set out in the TNDs remain unconfirmed and unenforceable.
Further information will be provided as and when appropriate.
