Corte Constitucional condiciona constitucionalidad de artículo 184 del COAM y declara inconstitucional artículos 462 y 463 de su reglamento

Reform to Regulation for the Stages of Exploration and Exploitation of Mining Concessions, Negotiation, and Signing of Mining Exploitation Agreements

February 27th, 2024

By means of Ministerial Agreement No. MEM-MEM-2024-0001-AM dated February 22, 2024, the Reform to the Regulation for the Stages of Exploration and Exploitation of Mining Concessions, Negotiation, and Signing of Mining Exploitation Agreements (hereinafter referred to as the ‘Ministerial Agreement‘) was issued. Below, we present the most relevant points of the Ministerial Agreement.

The Ministerial Agreement mainly regulates the following aspects: i) content of application for change to exploitation stage; ii) procedure for application and approval of change to exploitation stage; and, iii) minimum content of commencement of exploitation resolution.

Content of application for change to exploitation stage

90 days prior to the expiration of the economic evaluation period, the mining concessionaire must request from the respective Zonal Coordination of the Ministry of Energy and Mines (MEM) the transition to the exploitation stage.

A technical report on the mining resources and reserves must be provided in a format accepted by CRIRSCO, SAMREC, or similar, in Spanish.

If the area exceeds 5,000 mining hectares, the respective resignation must be submitted, which will be processed separately.

All information provided to the MEM will be confidential.

Procedure for application and approval of change to exploitation stage

The MEM shall review the request within 15 days. Within 3 days, it shall notify the mining concessionaire to complete, clarify, or rectify the request within a term of 10 days.

Upon completion of the information, the MEM shall forward the file to the District Directorate of the Agency for Regulation and Control of Non-Renewable Energy and Natural Resources (ARCERNNR). Within 30 days, the ARCERNNR will issue technical, economic, legal, and cadastral reports. In case of observations, the MEM shall notify the mining concessionaire to rectify them within 20 days.

Upon rectification of the observations, within 3 days, the MEM shall resend the file to the ARCERNNR. Within 10 days, the ARCERNNR will issue favorable reports. Once the MEM receives the favorable reports, within 20 days, it shall prepare the resolution to commence the exploitation stage.

Content of commencement of exploitation resolution

1. Recognition by the MEM of the investments made in the exploration stage to be considered for the calculation of the sovereign adjustment.

2. Express recognition of the specific sector regulations applicable to the mining concessionaire.

3. Description of the activities authorized for the mining concessionaire.

4. Possibility to extend the concession period during the exploitation stage.

5. Authorization from the MEM for the construction of all necessary mining infrastructure for the development of the mining project.

6. Obligations of the mining concessionaire:

a. Compliance with environmental obligations.

b. Compliance with economic, tax, labor, and audit obligations.

c. Submit all plans, programs, budgets, and reports required by the MEM.

d. Provide the MEM with information about their contractors (name, tax identification number, type of goods or services, and nationality).

e. Notify the MEM, ARCERNNR, and Environmental Authority within 24 hours (or when the situation allows) of an incident or emergency.

f. Apply International Standards in projects of similar characteristics, in the design, construction, and assembly of the mine, plant, and other necessary civil works for the start of activities.

g. Give preference to the national industry when they offer conditions of quality, price, safety, availability, comparable to those offered by foreign suppliers.

h. Allow for state use, when Applicable Legislation dictates, communication routes, airports, heliports, maritime and river ports, that are under the control of the Concessionaire.

i. Notify the MEM in case the mineral product is processed at third-party facilities.

j. Implement a real-time remote monitoring system through cameras, sensors, and/or other mechanisms in tailings storage infrastructure.

k. Procure all necessary insurance policies for the regular development of exploitation activities (contractors and suppliers must have insurance).

7. State obligations:

a. Grant promptly and efficiently precautionary measures and administrative protections.

b. Utilize the mechanisms provided in the applicable legislation to ensure the continuity of activities.

c. Grant promptly and efficiently all necessary permits for the exploitation stage.

8. Rights of the mining concessionaire:

a. Freely commercialize the mineral obtained in its extraction and beneficiation process.

b. Suspend the terms of the exploitation stage due to force majeure or fortuitous event.

c. Request the suspension of the commencement of the exploitation stage.

d. Receive prompt and timely responses to all requests addressed to the State.

e. Require and receive immediate assistance from police and military authorities to prevent personal or property damage.

f. Construct and install beneficiation plants, smelters, and refineries, waste accumulation deposits, buildings, camps, etc.

g. Obtain from the State the provision of the public service of electric energy for its mining operations, as an industrial consumer.

h. Request and obtain the establishment of easements necessary for the execution of mining activities.

i. Hire the services of a mining operator.

9. Possibility of assignment as security of mining rights.

10. Dispute resolution regime.

The authorization resolution for change to the exploitation stage must be protocolized and registered in the Mining Registry within 30 days.

For more information, please do not hesitate to contact us.



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