• The regulator accuses AVZ and two executives of misleading investors.
• The case concerns undisclosed disputes over the Manono lithium project in the DRC.
• AVZ denies wrongdoing and vows to contest the allegations.

Australia’s Securities and Investments Commission (ASIC) announced on Tuesday, November 11, that it has filed a lawsuit in Federal Court against AVZ Minerals, the mining company claiming rights to the Manono lithium deposit in the Democratic Republic of Congo (DRC).

The Australian regulator accuses the firm and two of its executives of failing to meet disclosure obligations to investors in connection with a dispute over the Manono project.

AVZ was listed on the Australian Securities Exchange (ASX) until May 2022, when trading was suspended. The company was subsequently delisted in May 2024. Through its subsidiary Dathcom Mining, AVZ held a 75% stake in the Manono project, the DRC’s largest lithium deposit, but failed to obtain exploitation rights.

Its joint venture partner, the state-owned mining company Cominière, announced in October 2023 that it had signed an agreement to jointly develop part of the deposit with China’s Zijin Mining.

AVZ contests these developments and has initiated multiple proceedings before international tribunals to assert its claims. According to ASIC, however, the company failed to disclose the ongoing legal dispute for nearly a year. AVZ’s CEO Nigel Ferguson and technical director Graeme Johnston allegedly breached their duties by authorizing or allowing the publication of “false or misleading” announcements on the ASX.

“In this case it was all but impossible for retail investors to travel to an overseas location in central Africa, in which the company’s operations are being conducted. In those circumstances, investors rely on the company to provide accurate and timely information. We allege Mr Ferguson and Mr Johnston failed to inform investors of the ongoing issues in this matter for nearly 12 months,” said ASIC deputy chair Sarah Court.

In a statement issued shortly after, AVZ and its directors strongly deny all allegations of misconduct. The company said it will defend itself vigorously.

The case, which could result in financial penalties for the two executives, comes as AVZ remains embroiled in a dispute over control of the Manono project. In recent months, the company held talks with U.S.-based KoBold Metals to withdraw its claims so that KoBold could take over the project.

Those talks did not succeed, and KoBold has since signed a framework agreement with the Congolese government to acquire and develop the hard rock lithium deposit at Manono, DRC, to resolve the disputes that have delayed progress.