Company: RTNTF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001628280-25-006642
Chunk: 399

Company: RIO TINTO LTD
Filing Date: 2025-02-20
Form: 20-F
Chunk 399
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 capacity may be provided from any of the network assets. The Asset User will pay an annualcharge, Committed Use Charge (CUC) over a contractually specified period irrespective of network usage. The constructing partner (AssetOwner) has an ongoing obligation to make available capacity from those assets and to maintain the assets in good working order as requiredunder relevant State Agreements and associated tenure. The arrangements are managed through two wholly-owned subsidiaries: PilbaraIron (Company) Services Pty Ltd and Pilbara Iron Pty Ltd.We have also considered whether the CUC arrangements give rise to a lease between the Asset Owner and the Asset User. We haveconcluded that they do not, as there is no specified asset; rather the Asset User has a first priority right to the capacity in the CUC asset. Thistreatment was grandfathered on adoption of IFRS 16 on 1 January 2019, following an assessment under the preceding standards IAS 17“Leases” and IFRIC 4 “Determining whether an arrangement contains a lease”, with no change to the conclusion under IFRS 16 forsubsequent expenditure subject to the existing CUC arrangements. Management considers that these arrangements are unique and hasused judgement to apply the principles of IFRS to the accounting for the arrangements as described above. The obligation of the AssetOwner to make capacity available is fulfilled over time and not at a point in time. The CUC arrangement is therefore an executory contract asdefined under IAS 37, whereby neither party has performed any of its obligations, or both parties have partially performed their obligations toan equal extent, and so the CUC payments are expensed as incurred. An alternative interpretation of the fact pattern could have resulted in agross presentation in the Group’s balance sheet with an asset and a corresponding liability to reflect the present value of the CUC payments.The Asset User is a wholly-owned subsidiary of Rio Tinto, whereas the Asset Owner is a joint operation. This impact would be someUS$929million(calculated on the basis of grossing up the tax written down value of the CUC assets). Other methods of calculating the gross-upmight give rise to different numbers. |

32 Entities accounted under the equity method Principal joint ventures The Group’s principal joint ventures at 31 December 2024 are summarised in the table below.

| Company and country of incorporation/operation | Principal activities                 | Groupinterest(%) |
| Canada                                         |                                      |                  |
| Matalco Canada Inc.                            | Aluminium recycling