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Mining Laws in Philippines

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    Mining Law

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    Recent Trends in the Mining

    Industry

    Global Environmental Problems

    Stratospheric ozone depletion

    Greenhouse climate change

    Biodiversity loss

    Land use competition

    Bio-fuels

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    Recent Trends in the Mining

    Industry

    Impacts

    Corporateconsolidation

    Financial marketpressure

    International reportingstandards (JORC)

    Demand forprofessionals in theresources industry

    Increased focus onsustainability

    Create sustainablecommunities

    Appropriateenvironmentalmanagement

    Communication with

    civil society/NGOs Sound governance

    corporate socialresponsibility

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    Environmental Economics

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    Mining as a Major Industry

    Located in the Pacific "Ring of Fire",the Philippines rank as one of themost highly mineralized countries:

    - third in gold, fifth in nickel, andsixth in chromite

    - untapped mineral wealth estimatedat US$840 billion (NEDA)

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    Mining as a Major Industry

    Tremendous remaining potential foradditional discoveries, since, despiteit's vast mineral wealth, the

    Philippines has seen little modernexploration.

    The Philippines provides a naturalgateway to other Asia Pacificeconomies, particularly China, withits voracious demand for metals.

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    Developments in the Philippine

    Mining Industry A change in government policy from

    tolerance to active promotion of mining(EO 270, Jan. 2004, setting the NationalPolicy Agenda on Revitalizing Mining in the

    Philippines). 100% foreign ownership allowed following

    the December 2004, Supreme Courtdecision abolishing all legal obstacles tothe implementation of the PhilippineMining Act of 1995.

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    Developments in the Philippine

    Mining Industry

    Rapu-rapu mine accident Conflict between national and local

    governments over taxation Insurgency small-scale mining

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    Mining Laws and other Regulations

    Philippine Constitution of 1987(Constitution)

    Philippine Mining Act of 1995(Mining Act)

    Mining Act Revised ImplementingRules and Regulations

    Other Laws

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    Constitution

    All lands of the public domain, water,minerals, coal, petroleum, and othermineral oils, all forces of potential energy,

    fisheries, forests or timber, wildlife, floraand other natural resources are owned bythe state.

    The exploration, development and

    utilization of these natural resources areunder the full control and supervision ofthe State.

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    Constitution

    The State has the option of enteringinto co-production, joint venture orproduction sharing agreements with

    Philippine citizens of Philippinecorporations or associations.

    At least 60% of the capital of acorporation or association must beowned by Phil. Citizen to qualify as aPhilippine corporation or association.

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    Constitution

    Exception to the nationalityrequirement: The Constitutionauthorizes the President to enter into

    agreements with foreign-ownedcorporations involving either financialor technical assistance, for large-

    scale exploration, development andutilization of minerals, petroleum andother mineral oils.

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    Constitution

    Ownership of natural resources(Regalian doctrine) if an investorwishes to acquire the right to extract

    or develop natural resources, hemust enter into an agreement withState

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    TYPES OF MINING PERMITS/CONTRACTS1. Mining Lease Contracts (MLCs)

    2. Exploration Permits (EPs)

    3. Mineral Agreements

    4. Financial or Technical AssistanceAgreement

    5. Mineral Processing Permit

    6. Quarry Permit

    7. Small-Scale Mining Permits

    8. Sand and Gravel Permits

    9. Ore Transport Permits

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    TYPES OF MINING PERMITS/CONTRACTS(under Presidential Decree No. 463)

    Declarat ion of Location (DOLs)

    Document attesting to the filing of a mining claim

    Allows the claimowner (mining applicant) to enter, occupy

    and conduct mineral exploration within the claimed area;

    Given the priority right to apply for any of the new modes ofpermits/agreements under Mining Act of 1995.

    Mining Lease Con tracts

    Contract allowing the lesee to explore, develop, extract and

    utilize minerals from the contract area;

    Respected up to the end of term under the Mining Act of

    1995; lessee is given the preferential right to apply for a

    Mineral Agreement.

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    TYPES OF MAJOR MINING TENEMENTS(under the Mining Act of 1995)

    A. TENEMENTS ISSUED BY DENR-MGB1. Exploration Permit

    2. Mineral Agreement

    Mineral Production Sharing Agreement

    Joint Venture Agreement

    Co-Production Agreement

    3. Financial or Technical Assistance Agreement

    4. Mineral Processing Permit

    5. Industrial Sand and Gravel Permit (>5 to 20

    hectares)

    B. PERMITS ISSUED BY LOCAL GOVT1. Quarry Permit

    2. Small-Scale Mining Permits

    3. Sand and Gravel Permits (5 hectares & below)

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    EXPLORATION PERMIT(EPs)Allows the permittee to conduct exploration workfor a limited period only.

    Two (2) years, renewable for like periods up to6/8 yrs;

    Maximum area: 16,200 hectares/Province;32,000 hectares in entire the

    country Area relinquishment: 25% for the first 2 years;

    10% /year, thereafter Open to companies with up to 100% foreign

    ownership; Priority to enter into either an MPSA or FTAA after

    submission and approval of Declaration of MiningProject Feasibility;

    Can be transferred or assigned to other qualified

    individuals/corporations.

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    MINERAL AGREEMENTS (MAs)a. Mineral Production Sharing Agreement

    (MPSA) Exclusive right to conduct mining operations w/in a

    contract area Limited to Filipinos or Filipino-owned corporations

    (Foreign equity not to exceed 40%)

    Minimum authorized capital of PhP 10 M and paid-up ofPhP 2.5 M

    Maximum area for juridical entity: 8,100 Has./Province;16,200 Has. for the entire country

    Contract period of 25 yrs; renewable for another 25yrs;

    Two (2) years Exploration Period; renewable for likeperiods up to 6/8 yrs; three (3) years Constructionand Development Period; the rest for production

    Can be assigned to any qualified individuals/corporations

    Can be converted into an FTAA

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    MINERAL AGREEMENTS (MAs)

    b. Co-Production Sharing AgreementAn agreement between the Government and the

    Contractor wherein the former shall provide inputs to the

    mining operations other than the mineral resource.c. Joint Venture Agreement

    An Agreement where a joint venture company is

    organized by the Government and the Contractor with

    both parties having equity share. Aside from the

    earnings in equity, the Government shall be entitled to ashare in the Gross Output.

    * These two modes of agreement have not been made

    operational due inability of government to input needed equity

    shares.

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    Other Permits:

    MINERAL PROCESSING PERMITS

    A 5-year Term, renewable for like periods, up to a

    maximum of 25 years;

    Allows both local and 100% foreign-owned corporations;

    Requirement to submit adequate ore supply contract to

    justify the establishment of the processing plant; Can be granted for cement plants, smelting and refining;

    beneficiation plants; marble cutting and processing plants,

    and others of similar nature;

    Issued by the Secretary for projects with cost of more than

    PhP 500 Million, by the MGB Director for projects with cost

    of more than PhP 200 Million but less than PhP 500

    Million, and by the MGB Regional Director for projects with

    cost of PhP 200 Million or lesser.

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    EXISTING MINING PERMITS/CONTRACTS

    Tenement Type Number

    Exploration Permits (EP) 28

    Mineral Production SharingAgreements (MPSA)

    228

    Financial or Technical Assistance

    Agreements (FTAA)

    2

    Mineral Processing Permits (MPP) 26

    Mining Lease Contracts/Patents 312

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    6 sets of application and

    mandatory requirements

    Filing of Application in

    Regional Office

    Area Status and Clearance/ Consentby MGB, DENR Sectors and/or other

    Govt. Offices

    Publication, Posting and RadioAnnouncement

    Clearance By DENR

    EP APPLICATION PROCESS FLOW

    Evaluation

    Approval by MGB CORegistration and Releasing

    By MGB Regional Office

    Proof of Sanggunian

    Consultation/Approval

    Certification of Publication/

    Posting/Radio Announcement

    NCIP CertificationPre-condition

    Certification By Panel Of Arbitrators

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    6 sets of application and

    mandatory requirements

    Filing of Application in

    Regional Office

    Area Status and Clearance/ Consentby MGB, DENR Sectors and/or other

    Govt. Offices

    Publication, Posting and RadioAnnouncement

    Final Review By MGB CO

    MPSA APPLICATION PROCESS FLOW

    Evaluation

    Approval by DENR SecretaryNumbering of MPSA by MGB

    Central Office

    Registration and Releasing

    By MGB Regional Office

    Proof of SanggunianConsultation/Approval

    Certification of Publication/

    Posting/Radio Announcement

    NCIP CertificationPre-condition

    Certification By Panel Of Arbitrators

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    6 sets of application and

    mandatory requirements

    Filing of Application in

    Regional Office

    Area Status and Clearance/ Consentby MGB, DENR Sectors and/or other

    Govt. Offices

    Publication, Posting and RadioAnnouncement

    Final Review By MGB CO /

    Negotiating Panel

    FTAA APPLICATION PROCESS FLOW

    Certification of Publication/

    Posting/Radio Announcement Evaluation

    Endorsement by DENR Secretary

    Numbering of MPSA by MGB CO

    Registration & Releasing By MGB RO

    NCIP Certification Pre-condition

    Certification By Panel Of Arbitrators

    Review / Approval by the President

    Proof of SanggunianConsultation/Approval

    Certification of Publication/

    Posting/Radio Announcement

    NCIP CertificationPre-condition

    Certification By Panel Of Arbitrators

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    GOVERNMENT SHARE FROM MININGNational Government

    Income Tax = 35 % of Taxable Income;

    Excise Tax = 2 % of actual value of minerals extracted; Customs Duties and Fees= prescribed under Tariff and Customs Code

    Value Added Tax = 10 % of Purchase Value of Goods/Services;

    Capital Gains Tax = 10-20 % of the gain;

    Tax on Interest Payments to Foreign Loans = 15 % of Interest;

    Tax on Foreign Stockholders Dividends = 15 % of dividend

    Royalties, if extracted from government Mineral Reservation = 5% of

    market value; Documentary Stamp Tax = graduated, depending on type of business

    transaction

    Local Government

    Local Business Tax: usually minimal, rate depends on LGU;

    Real Property Tax: Max. of 2 % on Fair Market Value of Property; Occupation Fee: PhP 100.00/hectare/year;

    Community Tax: Approx PhP 15,000

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    FISCAL REGIME OF FTAA

    Entitled to a 5-Year Cost RecoveryPeriod

    Exemption from payment of various nationaltaxes to enable the company to recover its

    investments;

    After recovery of investments, or at the end of the

    5-year period, whichever comes first, thecompany pays the usual taxes and fees, plus the

    additional Government Share.

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    FISCAL REGIME OF FTAA

    Basic Government Share

    National Taxes, i.e., Excise Tac, Income Tax,

    Customs Duties and Fees, etc.

    Local Taxes, i.e., Business Tax, Real PropertyTax, etc.,

    Additional Government Share to

    achieve a cumulative Government

    share equal to 50% of the Net-

    Mining Revenue

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    In 1997, group of NGOs petitioned the

    Supreme Court to invalidate Mining Act on

    the ground that foreign control over mining isunconstitutional:

    Nullification of the Mining Act of 1995 and its

    implementing rules and regulations

    Cancellation of the Financial or Technical

    Assistance Agreement (FTAA) of WMC

    SUPREME COURT DECISIONON THE MINING ACT

    Nature of the Case:

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    January 27, 2004 SC Decision:

    SC declared the following provisions asunconstitutional & void:

    All provisions of the Mining Act on theFTAA

    All provisions on Exploration Permits andMineral Processing Permits allowing the

    participation of foreign corporations Provision on incentives to the FTAA &

    Mineral Agreements (MPSAs,Co-Production & Joint-Venture Agreements)

    SUPREME COURT DECISION

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    December 1, 2004 SC Resolution on theMotion for Reconsideration:

    New judgment declared Mining Act, IRRand WMC FTAA as Constitutional

    Reversed and set aside the January 27,2004 Decision and dismissed the Petition

    Affirmed Presidents prerogative to enter

    into FTAA with foreign corporations toexplore, develop and utilize mineralresources

    SUPREME COURT DECISION

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    Highlights of the SC Resolution:

    The Constitution allows the continued use ofservice contracts with foreign corporations,which are similar to FTAAs

    Mining Act contains enough safeguards toregulate contractors

    FTAA fiscal regime is not disadvantageous to

    the State and to the Filipino people Foreigners are not prohibited from earning

    profits from businesses involving naturalresources extraction

    SUPREME COURT DECISION

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    Important Laws Related to Mining

    Environmental Impact Statement(EIS) System

    Indigenous Peoples Rights Act(IPRA)

    Local Government Code of 1991

    Small Scale Mining Act

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    EIS System

    Project proponent of environmentallycritical projects and projects withinenvironmentally critical areas must

    obtain an environmental compliancecertificate prior to commencement

    Environmental Management Bureau

    as lead agency

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    ENVIRONMENTAL PROVISIONS

    Environmental Impact Assessment All mining projects considered environmentally

    critical;

    Subject to Environmental Impact Assessment

    (EIA) and to secure the necessary EnvironmentalClearance Certificate (ECC) from the

    Environmental Management Bureau (EMB); and

    Activities during the exploration period exempted

    from the EIA/ECC requirement.

    Environmental Work Program In lieu of the ECC during the exploration period;

    Program to address environmental impact; and

    Defines financial commitment to be included in the

    annual exploration budget.

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    Environm ental Protect ion and Enhancement

    Prog ram (EPEP)

    Provides specific annual plans, programs and

    activities to institute environmental protection

    measures and/or rehabilitate mining-affected

    areas, during development and production

    stages; and Gives support in attaining the objectives of the

    Environmental Clearance Cerrtificate granted.

    Final Mine Rehabi l i tat ion /Decomm iss ion ing Plan

    Provides activities to achieve mine closure, i.e.,decommissioning, rehabilitation, residual care,

    etc.

    Establishment of a Fund to be deposited during

    early years of the mine life.

    ENVIRONMENTAL PROVISIONS

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    Contin gent L iabi l i ty and Rehabi l i tat ion Fund (CLRF)

    Fund to be deposited in a government bank; For the just and timely compensation of

    damages; For progressive and sustainable rehabilitation; Has two components:

    Monitoring Trust Fund (MTF):

    Replenishable fund with a minimum of PhP 150,000.00

    For exclusive use of the monitoring program by the

    multi-sectoral Multi-Partite Monitoring Team (composed

    of national and local government, non-government

    organization or NGO, and company representatives) in

    the conduct of regular environmental monitoring;

    Rehabilitation Cash Fund (RCF):

    Replenishable fund with a minimum of PhP 5,000,000.00

    or 10% of EPEP budget, whichever is lower;

    For the conduct of environmental protection and

    rehabilitation measures.

    ENVIRONMENTAL PROVISIONS

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    Mine Waste and Tail ings Fees

    Based on PD No. 1251

    PhP 5.00 per Metric Ton of mine waste materials

    PhP 10.00 per MT of mill tailings not utilized

    within a 2-year period;

    PhP 50.00 per MT for any discharge of solidmaterials for tailings not properly discharged into

    areas other than the duly approved tailings

    disposal area

    In i t ia l env ironment-related capital expend itures

    10% of the total capital/project costs

    Annual environmental protect ion and enhancement

    act ivi t ies

    3-5% of annual direct mining and milling cost

    ENVIRONMENTAL PROVISIONS

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    Other Laws Related to Mining

    National Integrated Protected AreaSystem Law

    Ecological Solid Waste Management Act Toxic Substances and Hazardous and

    Nuclear Wastes Control Act Clean Air Act Clean Water Act Pollution Control Law Water Code National Environmental Users Fee of 2002

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    Sustainable Development

    Is mining inherently inconsistent with

    sustainable development? Does it mean different things to

    different people?

    Does it mean something different indeveloped than in undevelopedcountries?

    Is it site specific?

    Is it a process or a product? Is it possible to have sustainable

    development, sustainable economicgrowth, sustainable communities and a

    sustainable society without mining?

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    Brundtland Definition of SD

    Current generations meeting their needswithout compromising the ability of futuregenerations to meet their needs

    IMPLIES:

    Future generations have rights over resources Current generation has a duty to include future

    generations needs in its decision-making

    An accounting of social and environmental

    impacts Who makes the call? Government, industry

    or the free market?

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    Business Case for SD

    What is Responsible Mining

    Financially viable miningdevelopment that takes place in anenvironmentally and sociallyresponsible manner with soundgovernance that provides lasting

    benefits to the community.

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    Regional/Local Issues

    Social and Community-RelatedIssues

    - Disclosure and information sharing

    - Community development plans- Consultation throughout a projectslifecycle

    - Compensation and resettlement- Local economic development

    - Mine closure

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    Regional/Local Issues Environmental

    - Legacy issues

    -No-go zones for environmental impactprojects

    -No-go technologies Small-scale mining

    - Legal tenure

    - Technical including safety andenvironmental

    - Conflict resolution (with commercialmining)

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    National Global Level Issues

    Governance

    - Transparency

    - Revenue management Others

    - Human rights

    - Indigenous people- Impact on global climate change

    Sustainable Development in the Context of

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    Sustainable Development in the Context of

    Mineral and Energy Development

    Encompasses:

    Economic Responsibility -- shareholders,employees, community, society

    Environmental Responsibility -- society is moreconcerned with minings impacts and behavior

    than its products Resource Stewardship -- wise and efficient use

    Community Engagement -- shared objectives

    Product Stewardship

    Social License and Public AccountabilityMinersmine with the consent of the public

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    IPRA

    Grants to indigenous culturalcommunities or indigenous peoplescertain preferential rights to their

    ancestral domains and all resourcesfound therein.

    Royalty and right to benefits

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    IPRA

    No mineral agreement shall beapproved unless:

    - There is prior certification from NCIPthat area does not overlap ancestraldomain or

    - Prior free and informed consent has

    been obtained from the ICC/IPconcerned

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    Development o f hos t and neighbor ing communi t ies

    through the Social Development and Management

    Program;

    Provision of alternative livelihood, health andnutrition, education, peace and order,

    infrastructure, etc. Budget of 90% of the 1% of the direct mining and

    milling costs;

    Preferent ial employment of major i ty from hos t

    commun it ies and ensure techno logy transfer ;

    Preferent ia l use of indigenous p rodu cts, services

    and technolog ies as wel l as local con struc t ion

    enterpr ises;

    Payment of royalt ies to surface owners

    SOCIAL PROVISIONS

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    Protect ion of r ig hts of IPs/ICCs

    Secure Free and Prior Informed Consent of

    IPs/ICCs

    IPs entitled to minimum 1% of annual grossrevenue for the implementation of Ancestral

    Domain Sustainable Development and Protection

    Plan

    Respect and preserve the culture and tradition ofIPs/ICCs

    SOCIAL PROVISIONS

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    Benefits/Obl igat ions to LGUs

    LGUs entitled to 40% of the excise tax (Barangay

    - 35%; Municipal - 45%; and Province - 20%)

    Endorsement from LGUs required for miningoperations

    Beneficiaries of social development projects

    SOCIAL PROVISIONS

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    Local Government Code

    Proponents applying for miningapplications intended for explorationactivities are required to conduct

    consultation with all LGUs concerned,or the legislative councils(sanggunian) at the provincial,

    city/municipal, and barangay levels.

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    Lessons Learned

    Consultation and relationshipbuilding between the mine andaffected people starting at

    exploration, based on respect forlocal community culture and land

    Mine closure planning with strongfocus on post-closure sustainability

    Local economic development planand agreements hiringpreferences, training, small

    businesses support, joint ventures

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    Lessons Learned

    Revenue sharing framework withspecific benefits for localcommunities

    Environmental and social protectionplans and agreements andindependent verification

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    What Mining Companies Has to Do

    Obey the law

    Pay proper taxes

    Be civic minded, actively financially

    support local communities and adaptto grassroots businesses

    Have Filipino staff

    Build relationships national andlocal

    Identify tribal leaders and real IPs

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    From Anglo American

    To secure a continuing license to operate, the

    mining and resources industry will have to

    frame its future in economically viable,

    socially beneficial and environmentally soundpractices that are negotiated with communities

    within which it works.

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    From Rio Tinto

    "We believe we can only continue to generate

    value for our shareholders over the long run if

    we excel in our performance on environmental

    and social issues. Sustainable developmentmanages all the business risks to earn a

    license to operate from all stakeholders."

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    PHILIPPINEMINING ACT

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    60

    1987 CONSTITUTION (Article XII, Sec. 2)National Economy and Patrimony

    A l l lands o f the pub l ic domains, waters,

    minerals, coal, petroleum, and other

    mineral oi ls , al l forces of potent ia l

    energy, f isheries, forests or t imber,

    w i ldl i fe, f lora and fauna, and o ther natural

    resources are owned b y the State. x x x

    The explorat ion, development, andut i l ization of natural resourcesshal l be

    under the fu l l con t ro l and superv is ion of

    the State.

    REPUBLIC ACT NO 7942

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    61

    REPUBLIC ACT NO. 7942MINING ACT OF 1995

    App roved on 20 February 1995 by Cong ress

    and consequent ly by President Fidel V.

    Ramos on 03 March 1995

    Espoused the pr inc ip le of responsib le

    min ing

    Revised Implement ing Rules and

    Regu lat ions app roved on 19 December 1996- DAO No. 96-40 by Secretary Victor O.

    Ramos

    DECLARATION OF POLICY (RA 7942)

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    62

    DECLARATION OF POLICY (RA 7942)

    Al l mineral resources in publ ic and

    pr ivate lands within the terr i tory andexclus ive econom ic zone of the Republ ic of

    the Phi l ipp ines are owned by the State. It

    shal l be the responsibi l i ty of the State to

    promote their rat ional explorat ion,

    development, ut i l izat ion and conservat ion

    through the combined ef for ts of the

    Government and p r ivate sector in o rder toenhance nat ional growth in a way that

    effect ively safeguards the env ironmentand

    pro tects the r igh ts o f affected commun i t ies.

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    63

    NEW PARADIGMON MINING

    Promot ion o f respons ib le m in ing as an

    eng ine for econom ic grow th and

    al leviation of poverty in the

    count rys ide;

    Str ict adherence to the pr inc iples of

    sustainable development econom ic

    developm ent , env ironmental protect ion

    & social equ i ty

    Executive Order No. 270/270A

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    64

    Issued on 16 January 2004

    Streng thened Mining Act o f

    1995 Provides 12 guid ing

    pr incip les for respons ib le

    m in ing = econom ic

    development,env i ronmental protect ion &

    social equi ty

    Executive Order No. 270/270A

    National Policy Agenda on

    Revitalizing Mining in the Philippines

    1995 Mining Act vis vis Old Law

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    66

    1995 Mining Act vis--vis Old Law

    1995 Mining Ac t

    EP, MPSA, FTAA

    Adequate environm ental

    pro vis ion s (Chapter XI)

    EWP dur ing explorat ion

    EPEP du r ing o perat ion

    FMRDP dur ing m ine closure

    Funds deposi ted for EPEP

    and FMRDP

    Recogni t ion and p rotect ion

    of IPs/ICCs (Sec. 16) Suff ic ient s ocia l provis ions

    (Chapter X)

    Mandatory SDMP

    Endorsement of LGU

    requ ired (Sec. 70)

    Old Laws (PD No. 463)

    Mining leases and claims

    Inadequate environmental

    prov is ions

    No EWP dur ing explorat ion

    No EPEP dur ing operat ion

    Unreal ist ic m ine clos ure

    requirement

    No funds d eposi ted for

    environmenta l wo rks

    No provis ion on recogni t ion

    and protect ion of IPs/ICCs Insu ff ic ient social

    p rov is ions

    Voluntary so cia l programs

    Endorsement of LGU not

    required

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    Government Management

    Mineral Reservations establishedby the President; mining operationsmay be undertaken by the DENR or

    through a contractor. Other Reservations mining in

    reserved lands other than mineralreservations may be undertaken by

    DENR or through a qualified person;awarded by the President

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    Areas Open to Mining

    Subject to existing rights

    Mineral resources in public or privatelands including timber or forestlands

    shall be open to mining permitapplications

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    Areas Closed to Mining

    Military & other government reservationsexcept upon prior written clearance fromgovernment agency concerned

    Built up areas, including plantations orvaluable crops except upon writtenconsent of govt agency or private entityconcerned

    Areas covered by valid and existingmining rights

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    Areas closed to Mining

    Areas prohibited by law

    Areas covered by small scale minersunless with prior consent of SSMs

    Old growth or virgin forests,proclaimed watershed forestreserves, mangrove forests, mossy

    forests, national parks under NIPAS

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    Small Scale Mining

    Governed by RA 7076 (small ScaleMining Act)

    Managed through the P/CMRB

    Maximum 20 hectares

    Includes Quarry Permits, permits forsand and gravel, guano, gemstonegathering; government gratuitouspermit; private gratuitous permit

    Transport Sale & Processing of

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    Transport, Sale & Processing of

    Minerals

    Ore Transport Permit specifiesorigin & quantity

    Mineral Trading Registration

    registered by DTI and accredited byDENR

    Minerals Processing Permit

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    Auxiliary Mining Rights

    Timber rights subject to forestrylaws, rules and regulations

    Water rights approval by

    concerned agency

    Right to possess explosives

    Easement rights

    Entry into private lands andconcession areas

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    Settlement of Conflicts

    Regional Panel of Arbitrators twomembers of the Philippine Bar andone licensed mining engineer or

    professional in a related field. Mines Adjudication Board DENR

    Secretary as Chair, USEC for Field

    Operations & MGB Director asmembers

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    Taxes and Fees

    Income taxes

    Excise tax on mineral products 2%

    Mine wastes and tailings fees semi-annual 0.05 / MT; 0.10/ MT

    Occupation fees EP = P10 /ha;MPSA = P100/ha; 30% to theprovince and 70% to the municiplaity

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    Grounds for Cancellation

    Late or Non-filing of requirements

    Violation of the terms and conditionsof Permits or Agreements

    Non-payment of taxes and fees

    Falsehood or omission of facts in theStatement

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    Penal Provisions

    False statements P10,000 Illegal Exploration P50,000

    Theft of Minerals 6 months to 6

    years imprisonment and/or fine ofP10,000 to P20,000

    Destruction of mine structures

    imprisonment not to exceed 5 yearsplus compensation for damages

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    Penal Provisions

    Mines arson revised Penal Codeplus compensation for damages

    Wilfull damage to a mine

    imprisonment not to exceed 5 yearsand compensation for damages

    Illegal obstruction to permittees or

    contractors P5,000 orimprisonment not exceeding 1 yearor both

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    Penal Provisions

    Violation of the terms and conditionsof the ECC 6 months to 6 yearsimprisonemtn or a fine of P50,000 to

    P200,000 or both at the discretion ofthe court

    Illegal obstruction to (DENR)government officials P5,000 fine or

    imprisonment not exceeding 1 yearor both


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