Federal Court of Appeal has upheld Tax Court ruling in favour of Cameco

Cameco Corp. says the Federal Court of Appeal has upheld a 2018 decision of the Tax Court of Canada that was in the company's favour.

The 2018 decision, which centred around its use of a subsidiary in Switzerland to sell and trade its uranium, was appealed by the Canada Revenue Agency.

The agency contended it was a sham established to avoid Canadian taxes, while Cameco maintained it was for legal and sound business practices.

The Saskatoon-based uranium miner said it is very pleased that the Court of Appeal unanimously upheld the Tax Court's ruling.

The ruling covers Cameco's 2003, 2005 and 2006 tax years.

Canada Revenue Agency officials could not immediately be reachedfor comment.

"Four judges have now found that Cameco complied with both the letter and intent of the law," Cameco president and CEO Tim Gitzel said in a news release.

"We followed the rules, yet this 12-year dispute has caused significant uncertainty for our company and our stakeholders at a time when we have been navigating through some of the most challenging global market and economic conditions we have ever faced."

Cameco noted that a subsequent decision by the Tax Court in April 2019 resulted in the company being awarded $10.25 million in legal fees and up to $17.9 million in disbursements for costs incurred as a result of its dispute with the agency.

The CRA has until Sept. 25, 2020, to seek leave to appeal the decision of the Court of Appeal to the Supreme Court of Canada.

However, proposed legislation related to COVID-19 pandemic measures is presently under consideration that would extend the deadline to Nov. 12, 2020.

The Court of Appeal ruling is not legally binding on the subsequent tax years (2007-13) that are also in dispute.