Guatemala’s largest nickel mine paid just £1.4m in compulsory royalty taxes during its first four years of production, according to its latest filings.

The opencast Fenix mine belongs to the Bronstein family and is run by their Swiss-based Solway group. Solway benefits from Guatemala’s low nickel royalty rate, which is calculated at just 1% of all the revenues made from selling the unrefined ore it digs out of the ground. Recent proposals to increase rates to 15% were not implemented.

An analysis of Solway’s filings with the country’s mining ministry helps to explain why its contribution is so low.

Solway’s extraction business, Compañía Guatemalteca de Níquel (CGN), digs the ore out of the ground. Its sister company, Pronico, also owned by Solway, operates a refinery at the Fenix site, and after buying the ore from CGN, turns it into ferronickel.

CGN is the company that pays the compulsory royalty tax. The price at which it sells to Pronico determines its revenues, and therefore how much the Guatemalan treasury receives.

In 2017, the most recent year on record, filings show Pronico paid an average of just 36 quetzals (£3.70) per metric tonne of untreated ore. At its lowest, the price paid by Pronico has been less than the cost of digging the mineral out of the ground, Solway concedes.

The company says its subsidiaries comply with the law, and the price Pronico pays is pegged to the London metal exchange, where nickel prices slumped in 2015 and 2016. When nickel reaches a certain price, Solway says both of its Guatemalan subsidiaries pay “voluntary” royalty taxes of 2% to 3%.

Since it first acquired Fenix, Solway says it has contributed more than £50m to the country in other taxes, including VAT and social security payments for staff.

The company was co-founded by Aleksandr Bronstein, an Estonian entrepreneur, and his son Daniel, who is a German citizen.

While the media often refer to Solway as a Russian firm – many of its workers have moved to Guatemala from Russia and Ukraine – the Bronsteins describe their business, and themselves, as European. They have a small headquarters in the Swiss town of Zug, and mining interests around the world.

The privately owned company is controlled by a family trust. The ownership structure is obscured by an offshore network that ranges from Cyprus to Malta, the British Virgin Islands, and St Vincent and the Grenadines.

The family have several ties to the UK. Daniel Bronstein graduated from Birmingham University and has worked in London, while his father owns a large mansion overlooking Hampstead Heath.

Bronstein appears to have borrowed money from the billionaire Sir Leonard Blavatnik, using the Hampstead property as collateral. Blavatnik made his fortune in chemicals and Russian petrol before acquiring Warner Music Group.

The loan is in the name of AI International Holdings (BVI) Limited, part of Blavatnik’s Access Industries empire. “There is a registered, arm’s length loan on the property,” a spokesperson for Access said. “There are no ties in any manner to Mr Bronstein’s business interests.”

The Bronsteins confirmed neither Blavatnik nor his companies have any part in the Solway business.