Saturday, March 7, 2020

Council of Ministers Regulation No.423-2018 to PROVIDE FOR MINING OPERATION

 
Council of Ministers Regulation No.423-2018 to PROVIDE FOR MINING OPERATION

This Regulation is issued by the Council of Ministers pursuant to the Definition of Powers and Duties of the Executive Organs of the Federal Democratic Republic of Ethiopia Proclamation No. 916/2015 Article 5 and Article 82 (1) of Mining Operations Proclamation No. 678/2010 (as amended by Proclamation No. 816 /2013)

                                     

PART ONE
GENERAL

1.  Short  Title
This Regulation may be cited as the “Mining Operations Council of Ministers Regulation No. 423/2018”.

2.  Definitions
In this Regulation unless the context requires otherwise:

1/ the definitions provided in the Mining Operation Proclamation No.678/2010 (as amended) shall apply;

2/ “agreement” means a contract concluded between the Government and the licensee in order to conduct reconnaissance, exploration, retention and mining;

3/ “community development” means economic, social and environmental protection activity under taken around the license area to benefit the local community;

4/ “consultancy” means a service rendered by a professional having certificate of professional competence in the mining sector;

5/ “development program” includes pre-production works involving erection of infrastructure, making the surface of the earth ready for mining, excavation of underground entrance, and procurement, transportation and plantation of mining equipments, production test, and of other similar activities;
6/ “discovery” means an identification of the existence or an indication of minerals where the minerals were not previously discovered in the area in question and are not subject to exclusive right or an application thereof or have not been reserved;

7/ “financial position” means a document submitted by an applicant which verifies the proportional amount of money deposited at domestic bank to guarantee the execution of the proposed work plan at least for the first one year;

8/ “financial situation” means evidence that reveals the applicant’s amount of money prepared for his mining operations plan including his financial position, as the case may be;
9/ “fund” means the amount of money allocated by the licensee pursuant to the appropriate laws and agreement in order to rehabilitate the license area and the area surrounding the license area to participate in community development plan;

10/ “license application fee” means a payment conducted by any applicant for registration of his application for mining operations;

11/ “block” means one portion of area acquired by partitioning the total license area in accordance with Article 14 of this Regulation;
12/ “performance report” means a document prepared by the licensee in accordance with the license agreement which contains detail technical and financial activities of his mining operation and the result thereof;

13/ “Proclamation” means Mining Operation Proclamation No. 678/2010 (as amended);


14/ “samples of mineral” means minerals which are not in commercial volume and  taken from natural bulk for the purpose of conducting research, laboratory testing, and for market promotion subject to processing as well as for other objectives, as appropriate;

15/ “supervisor” means a person authorized by the Licensing Authority, to supervise and administer mining operations, pursuant to the Proclamation and this Regulation;

16/ “technical competence” means a document submitted by any person who applies for mining operation that demonstrates applicant’s knowledge, skills and experience to carry out his mining operation in accordance with the proposes work program;
17/ “technical service” means a provision of services associated with a mining operations like drilling or laboratory services carried out by an Ethiopian who possess the required certificate of technical competency.

PART TWO
LICENSES OF MINING OPERATIONS


CHAPTER ONE
APPLICATIONS FOR LICENCES



3.  Applications for Reconnaissance License
Application for reconnaissance license shall be attached with the following particulars:

1/ where the applicant is a natural person:

a) his full name, sex, age, nationality, place of birth and copy of identification card;
b) profession;
c) place of residence and address;

d) a simple geometrical map that indicates the proposed mining area with a type of mineral subject to a license;

e) intended work program and expenditure during the license period;

f) evidence that shows the reconnaissance work could cause damage to the surface of the earth or not;   

g) where the work program is prepared by the applicant’s employee, the full name, profession, copy of Identity Card of the employee who prepared the program and employment contract as the case may be;
h) where the work program is prepared by the consultant; renewed trade license, Tin Number, copy of a certificate of professional competence for consultancy service; and

i) other relevant documents the Licensing Authority may determine by directives;

 2/ Where the applicant is a legal person   :

a) its name, nationality, and capital;

b) address of its head office, name and address of its representative in Ethiopia;
c) information’s specified in paragraph (d), (e),  (g), (h) and  (i) of sub-article (1) of this Article; and

d) the following documents duly certified by the appropriate government organization:

(1) copies of its memorandum and articles of association;
(2) the name and evidence of the natural person who is designated to sign on behalf of the applicant organization;

4.   Application for an Exploration Licenses

Application for an exploration licenses shall be attached with the following particulars:

1/ where the applicant is a natural person:
a) particulars stated under paragraph (a) to (i) of Article 3(1)  of this Regulation, except the particular stated under paragraph (f);

b) the applicant’s reconnaissance license number, if any, on which the application is based;

c) a geo-science information known to applicant regarding the minerals and the area for which the license is requested including a work program and proposed expenditure during the term of the license;

d) documents showing environmental and natural resource impact assessment and restoration plan;

e) explanation showing the applicant’s technical competence and experience;
f) the applicant financial situation which is approved by the competent government organ;
g) evidence showing the geographical coordinates of the area subject to an application;
h) a map prepared in accordance with paragraph (d) numbers (1) and (2) of sub-article (1) of Article 6 of this Regulation;
2/ where the applicant is a legal person:

a) particulars specified under Article 3(2) of  this Regulation;

b) copies of the balance sheets, profits and loss statements and auditor’s reports for the previous three years,

c) where the entity administered by Board of Directors, the following documents duly certified by the appropriate head of such entity:

(1) copy of the latest annual report of the board of directors,
(2) name, address and nationality of board of directors.

5.   Application for Retention License
Application for retention license shall be attached with the following particulars:

1/ the identification number of the applicant’s exploration license on which the application is based;
2/ the geographic coordinates of the proposed retention license, and an indicative map;
3/ the general technical information of the potential mineral reserve verified during exploration stage;
4/ justifications for adverse market conditions, unavailable processing technologies or other economic factors that prevent to develop the mineral deposit;

5/ feasibility study report;

6/ possible alternative measures to be undertaken during the retention period and their time table;
7/ subject to the provisions of Article 24 (1) of the Proclamation, the period for which the license is sought.

6.   Application for a Small or large Scale Mining License
An application for a small scale or large scale mining license shall be attached with the following particulars:

1/ where the applicant is a natural person:

a) particulars stated under paragraph (a) to (i) of Article 3(1)  of this Regulation, except the particular stated under paragraph (f);
b)  information specified under paragraph   (f) and (g) of Article 4(1)  of this Regulation;
c) the applicant’s exploration license number on which the application is based, if any;

d) feasibility study document;
e) environmental and social impact assessment reports of the mining operation;

f) proposed development program and other information determined by the directives of the Licensing Authority.

2/ Where the applicant is a legal person:

a) the information’s specified under paragraph (c) , (d), (e)  and (f) of sub-article (1) of this Article;
b) the information’s specified under paragraph (d), (g) and (h) of sub-article (1) and paragraph (a), (b) and (d) of sub-article (2) of Article 3 of this Regulation;

c) the information’s specified under paragraph (b) of Article 4 (2) of this Regulation.
3/ The feasibility study document specified under paragraph (d) of sub-article (1) of this Article shall include the following:
a) a plan of the proposed license area, at an appropriate scale, indicating the geographical coordinates of the turning points along its boundaries and the map which shows the distance between them;
b) a map of the proposed license area at an appropriate scale, indicting the geographical coordinates within the license area and at least 500 meters along its official boundary survey, and showing major land marks, buildings, infrastructures, topographic and other physical features;
c) details of the reserve including physical, mineralogical,geotechnical characteristics of the minerals;
d) the proposed production method including detail study for acceptable and good trial production technology;

e)  proved, estimated and inferred reserves of the deposit, and the period for which the license is sought to mine the reserve in sustainable manner;

f)  comprehensive study of market conditions, the planned amount of annual production and sales revenues, capital and operating expenditures, depreciations and other deductibles and estimated profit and cash flow;

g)  the applicant’s organizational structure;

h)  details of essential infrastructures;

i)  program summery of employment and training.

7. Application for Special Small Scale Mining License
Application for special small scale mining license shall be attached with the following particulars:
1/ where the applicant is natural person:
a) information specified under paragraph (a), (b),  (c) and (d) of Article  3 (1) of this Regulation;
b) environmental and natural resource impact assessment document with respect to the area which the license is requested for;
c) intended amount of expenditure for the environmental and natural resource impact restoration work during the license period;
d) information with regard to the intended work program to be discharged during the license period and his financial position to execute the same;
e) the original and a copy of his previous artisanal mining license.

2/ where the applicant is a legal person:

a) its full name, nationality, legal form and address;
b) information specified under paragraph (d) of  sub-article (1) and paragraph (d) of sub-article (2) of  Article 3 of this Regulation;
c)  information specified under paragraph (b), (c), (d) and (e) of sub-article 1 of this Article.     
3/ other relevant documents determined by the directive of the Licensing Authority.
8.  Application for an Artisanal  Mining License

Application for an artisanal mining license shall be attached with the following particulars:

1/ where the applicant is a natural person:
a) his full name, nationality, sex, address and age;
b) location of the minerals for which the license is requested;
c) other relevant documents determined by the directive of the Licensing Authority;

2/ where the applicant is small and micro enterprise:

a) his name, address and nationality;

b) evidence that demonstrate as it registered as small and micro enterprise in accordance with relevant law and eligible to carry on trade pursuant to  commercial law;
c) information specified under paragraph (b) and (c)  of sub-article (1) of this Article.

CHAPTER TWO
ISSUANCE OF LICENSE

9.  Registration,  of Applications
1/ Any application for a license filled and submitted in form prepared by the Licensing Authority for such purpose, shall be registered in the registry prepared for same in their order of reception before examining the fulfillment of the information specified under Article 3, 4, 5, 6, 7 and 8 of this Regulation.


2/ When application is submitted pursuant to sub-article (1) of this Article the Licensing Authority shall, after the laps of the period specified under Article 14(2)  of the Proclamation, cause payment of registration fee and provide the applicant with the approved mineral cadastre registry which specifies the date, time and number of registration.
3/ The registration of application conducted pursuant to sub-article (1) and (2) of this Article merely shall not make the applicant eligible for a license.   

4/ The registry shall be open to the public in accordance with directive to be issued by the Licensing Authority for inspection.
5/ Any application registered shall be considered abandoned by the applicant and as a result the licensing process shall be terminated, if the applicant fails to follow up the licensing process or fails to provide the required information for more than two months.

 10. Lodging of Objections
1/ Any person may file a written objection against the grant of such license in accordance with Article 14(2) of the Proclamation.


2/ If the Licensing Authority rejects the objection and approves the application, it shall enter such decision in a registry of cadastre kept for same purpose pursuant to Article 9(2)  of this Regulation; and the applicant shall sign on the register.
11. Grant, Registration and Notification of License
1/ The Licensing Authority after verifying the fulfillment of the following conditions shall grant the requested license:
a) where the area for which application is lodged for license is not subject to another licensee and not prohibited by any other appropriate laws;

b) where the geographical coordinates and descriptions of minerals of an area subject to an application published on news papers which have wider circulation by the expense of the applicant and no objection is filed within 7 days as specified under Article 14 (2) of the Proclamation;
c) where the original certificate of business license and a Taxpayers Identification Number (TIN) is submitted;
d) information submitted in connection with the application are verified to be correct and acceptable;

e)   where the applicant has demonstrated that  he has the necessary technical capability and experience to carry out  undertakings  specified  under  the work program and financial resources  to execute the work program  and to meet any other obligations  emanated from the  license requested;
f) the applicant, pursuant to Article 46 of this Regulation, submit all information that proves the payment of prescribed license fee;
g) where the application is for mining license, the licensing authority primarily ascertain by physical appearance that the topographic conditions and coordinates of the license area are in accordance with the Proclamation.
2/ The registry of the granted license shall be opened to the public for inspection in accordance with directive to be issued by the Licensing Authority.
3/ Any person may, upon request and payment of the service fee specified under Article 47 of this Regulation, get the copy of the registered and numbered map of the area which specifies the area for which application is lodged or license is granted.

12. Granting License through competitive bid
1/ License may be granted through competitive bid:
a) without prejudice to Article 13 (4) of the Proclamation and Article 11(1)  of this Regulation, when it is an exploration and mining licensee over the area in which the existence of deposit of precious minerals, metal and as the case may be a deposit of other minerals, is discovered;


 b) when the Licensing Authority decides that the mining area in which the minerals discovered shall be licensed through competitive bid;
c) when the Licensing Authority decides to grant license through competitive bidding and more than one applicant lodge application within the determined period of time.

2/ A bid document shall be attached with the following:
a) document showing the applicant’s technical and operational plan, money allocated for operation, financial situation, experience and competence;
b) a guarantee from financial institutions which accounts for  25%  of the proposed first year budget for performance of obligation.

3/ The selection of application lodged for bid shall be conducted in accordance with the criteria determined by directive and the Licensing Authority shall grant a license for the applicant who scores the highest result. 



4/ The guarantee provided pursuant to sub-article (2) (b) of this Article shall immediately be returned for those who lost the bid; provided, however, that the winner’s guarantee shall be returned, when the Licensing Authority believes that the obligation of expenditure and work program to which he proposed for his first year mining operation has been fulfilled.
5/ Notwithstanding the provision of sub-article (4) of this Article, if the applicant fails to meet his proposed obligations the guarantee money shall be paid to government account.
6/ If only one bidder appears the bidding process shall be cancelled, unless the Licensing Authority decides for second-bid, and the process of granting license shall be conducted in accordance with Article 9 to 11 of this Regulation.

13. Refusal to Grant License
 1/ The Licensing Authority may refuse to grant a license by the following reasons:
a) if the application or related  information supplied in connection with the license are materially incomplete;


b) if the work program submitted, the amount of expenditure allocated for the work program and guarantee of financial position or development and production program obligations are not acceptable;
c) if the proposed license area is subject to an objection and the Licensing Authority uphold the objection;

d) if the applicant, against whom an objection filed, failed to amend or complete deficiencies of his application;

e) if the applicant, against whom an objection filed, failed to rebut the objection within seven days.

2/ If the Licensing Authority refuses to grant a license pursuant to this Article, it shall so notify in writing, within 15 days, by stating the reasons for its decision.

14. Size of License Area
1/ The maximum area to be granted for an applicant may cover more than one block and as the case may be it might include different license areas; provided, however that the maximum area to be held by a single licensee shall be as determined in a directive.

2/ Without prejudice to the provisions of sub-article (1) of this Article, the maximum area to be covered by a single block shall be the following:
a) 50 km2 for a reconnaissance license;
b) 20 km2 for exploration license;
c) 100,000 m2 for retention license;
d) 5,000 m2   for artisanal mining license;

e) 100,000 m2 for the small scale industrial and construction minerals mining license;

f) 200,000 m2 for large scale industrial and construction mineral mining license;

g) one square kilo meter for small scale and large scale mining license for precious, semi-precious, metallic and other minerals.

3/ An artisanal mining licensee shall not be granted with more than two licenses and an area exceeding 10,000 m2 at a time.

4/ Where the mining activity of the A special small scale mining licensee granted license in the previous artisanal mining license area, if demonstrates good production performance, additional area may be granted as determined in the directive. 
5/ The maximum areas of small and large scale mining license might be determined by directive to be issued based on the type of the mineral; provided, however, it would not be more than a license area proved to have deposit of mineral reserve which could be mined in not more than 75 years.
15. Replacement of Copies of License
1/ The licensee may apply in writing to the Licensing Authority for replacement of a license which has been lost, destroyed, dispossessed through theft, or made useless due to various reasons.

2/ The Licensing Authority shall, after investigating and verifying  the eligibility of such request, issue the replacement of copy of license to the licensee upon payment of the prescribed service fee, pursuant to Article  47(2)  of this Regulation.

CHAPTER THREE

RENEWAL, TRANSFER, SUSPENSION AND   REVOCATION OF LICENSE

16. Renewal of an Exploration License
1/ Application for the renewal of an exploration license shall be submitted made 60 (sixty) days before the end of its terms specified in the license and shall be attached with the following documents:
a) annual summery report which contains information submitted for original license or changes, if any, in the application or during renewal and acquired outputs and other relevant information determined in directive;

b) report including the impact of mining operation resulted to the environment and natural resource in the previous license period and restoration measures taken;

c) the licensee’s detail work program, environmental and social impact assessments, development plan and expenditure proposal during each year of the next renewal  period;

d) portion of license area be relinquished and geographical coordinate of the license area for which renewal is sought pursuant to Article 22 (1) of the Proclamation;


e) other information determined by the directive of the Licensing Authority.
2/ Where the licensee failed to lodged an application for renewal timely pursuant to the provisions of sub-article (1) of this Article, the Licensing Authority submit a written notice to the licensee within 15 days.

3/ Where the licensee fails to submit his renewal application within 15 days after receiving notice pursuant to sub-article (2) of this Article, the license shall be presumed as terminated from the date of its expiry.

4/ The land to be relinquished pursuant to sub-article (1) (d) of this Article shall, unless the Licensing Authority agrees otherwise,  be block by block, which is coordinated  in a simple geometric form comprised of not less than one square kilometer units.

5/ Without prejudice to the provisions of Article 22 (3)  and  (4)   of the Proclamation, the Licensing Authority after verifying the existence of  following force majeure, may allow a renewal of an exploration license without relinquishment of a portion of the license area:
a) prolonged delay of the result of sample test and major break downs of machineries which are decisive for the operation and the occurrence of other similar situations which are beyond the control of the licensee;
b) inability to conduct the operation as per the work program due to disputes with other licensees or any other third party;
c) where the occurrence of events considered as forced majeure under the Civil Code hampers the operation in significant and sustainable manner.

6/ The licensee shall take all reasonable measures to mitigate the impact of the occurrence of force majeure and provide an evidence to prove the occurrence of events specified under paragraph (a), (b) and (c) of sub-article (5) of this Article and notify in writing to the Licensing Authority.
7/ The Licensing Authority shall, upon payment of the prescribed renewal fees and land lease rental, renew the exploration license in not more than 30 (thirty) days in accordance with Article 19 (2) and (3) of the Proclamation after verifying that the documents attached with the application are acceptable.

17. Renewal of Retention License
1/ Application for the renewal of retention license shall be made within 90 days prior to the end of the term of the license and shall be attached with the following documents:
a) the general report which contains any change and condition still prevails in the information submitted during application for the original license pursuant to Article 5 (4), (5) and  (6)  of this Regulation and other relevant information determined by  directive;
b) detail of the proposed work program to develop and mine the minerals during the renewal period;
c) information specified under Article 23(1) of the Proclamation and such other information to be determined by the directives.
2/ The Licensing Authority shall, upon payment of the prescribed fees and land lease rentals, renew the retention license in not more than 30 (thirty) days in accordance with Article 24 (2) of the Proclamation, after verifying that the documents attached with the application are acceptable.

18. Renewal of Special Small, Small or Large Scale Mining Licenses


1/ An application for the renewal of special small, small or  large scale mining license shall be made 180 days prior to the expiry of the  term of the license; and shall attach the following documents:


a) any change in the information submitted during application for the original license or during renewal of same;


b) except the special small scale mining license; detail report indicating the remaining proved, estimated and inferred reserves of the deposit and subsequent plan of operation;
c) the proposed production program, expenditure and cash flow for the next renewal period;

d) the current financial audit report of the licensee confirmed by external auditor;
e) social and environmental impact assessment report for the renewal period;
f) report which shows restoration measure taken to mitigate the impact of the mining activity on environment and natural resource during the previous license period.
g)    such other information considered to be relevant and minerals that the amount of reserve deposit is not required shall be determined by the directives.


2/ The Licensing Authority upon examining information submitted with application and accepts them, it shall renew the license in accordance with Article 27, 29 and 33 of the Proclamation:
a) upon verifying that the licensee has discharged his contractual and legal obligation of the previous mining license, and
b) upon the payment of the prescribed renewal and land lease fees by the applicant and

19. Transfer of License
1/ Without prejudice to Article 40 of the Proclamation, the licensee or his heirs, by providing all necessary documents and upon payment of application fee, may request in writing the Licensing Authority to transfer his license.


2/ Application for sale or assignment of an exploration, a small scale or large scale mining license, shall be attached with the following:
a) the information specified under paragraph ( a), (b), (c) and  (d)  of Article 3(1) of   this Regulation, if the application to sale or assign the license to a natural person;

b) the information specified under paragraph (a), (b), (c) and (d) of Article 3 (2)  of this Regulation, if the application to sale or assign the license to a legal person;


c) contractual agreement of the proposed sale or assignment;
d) evidence of payment of income tax from the net profit which is going to be computed from the transferor’s share in accordance with income tax law, if the application to sale or assign small or large scale mining license.

3/ Application for the encumbrance of a small scale or large scale mining license in accordance with Article 40 of the Proclamation shall be attached with the following:
a) where the proposed beneficiary of such encumbrance is natural person, information required under paragraph (a) and (b) of Article 3(1) or in case the beneficiary is legal person information required under paragraph (a), (b), and (d) of Article 3(2)  of this Regulation;

b) the nature, terms and conditions of security interest proposed to be granted including such safeguards specified in the directives issued by the Licensing Authority may require.
4/ Application to transfer a special small scale, small scale and large scale mining license by inheritance in accordance with Article 40 of the Proclamation shall be attached with the following:
a) certificate of heir;
b) information required under paragraph (a), (b),  (d)  of sub-article (1) and  paragraph (a), (b) , (d) of sub-article (2) of Article 3 of this Regulation for natural and legal person, respectively.

5/ Application to transfer artisanal mining license by inheritance in accordance with Article 40 of the Proclamation shall be attached with the following:
a) certificate of heir and information specified under Article 8 of this Regulation;

b) evidence showing that the transferee heir committed himself to meet all terms and conditions of the license.

6/ The transfer of license shall be permitted only after the Licensing Authority verifies that the following documents shall be attached with the application:

a) if it is confirmed that the licensee has fulfilled all its obligations in accordance with the Proclamation, regulation, directives and on terms of his license agreement;
b) if the total area to be possessed by the transferee is not more than the maximum size of the area specified by directive;

c) in case of inheritance, if the transferee previously hold a license and the total license area exceed the maximum size of the area permitted for a single person only if he prefers the inheritance;


d) if the transferee agrees to comply with mining laws, terms and conditions of the license, and the work program of the licensee.

7/ Except by way of inheritance, any exploration license may be transferred, if the following particulars are fulfilled;


a) if the licensee has been discharged the first year exploration and fulfilled his obligation regarding to the minimum work program and expenditure specified in his license agreement;
b) if the licensee has been operating for more than one year, he shall be expected to fulfill his minimum obligation in relation to work program and expenditure responsibilities until the time of transfer, 

20.Suspension and Revocation of the licenses
1/ Without prejudice to Article 46 (3) and (4) of the Proclamation, the Licensing Authority may suspend or revoke license where the licensee commit contravention stated under Article  50 of this Regulation or Article 46 (2)  of the Proclamation.
2/ Without prejudice to sub-article (1) of this Article an artisanal mining license may be revoked pursuant to Article 34(5) of the Proclamation.

PART THREE
CERTIFICATE OF DISCOVERY AND
CERTIFICATE OF COMPETENCE


21. Application for a Certificate of Discovery
1/ Any person who discovers indications or existence of minerals may immediately apply to the Licensing Authority for a certificate by placing a marker, as appropriate, to the location of discovery and shall specify the region, specific area, and the type of the minerals.

2/ Any person, who discovers indications or existence of minerals, shall submit application of discovery to the Licensing Authority, with the application indicating the nature of the minerals, laboratory result, samples of the minerals and supporting letter from the wereda office responsible with respect to mines, at the place where the mineral discovered.


22. Verification of Discovery and Certification

1/ The Licensing Authority, up on receiving application, shall:

a) register the application, verify the nature of the minerals submitted and the location of the markers placed by the discoverer, and shall confirm that the area and the mineral in question are not subject to an exclusive right or an application thereof, and the area has not been reserved or excluded;
b) investigate and compare the similarity of the sample with the discovery sample submitted by taking the geographic coordinate where marker is placed, that the mineral naturally exists, the nature of the minerals, as the case may be, by taking photograph information.


2/ Where the discovery is verified in accordance with sub-article (1) of this Article, the area and the mineral is subject to license application, the Licensing Authority shall, pursuant to Article 49 of the Proclamation, issue a discovery certificate to the discoverer valid for 18 months from its date of issuance.

23. Rights and Obligations of a Holder of Certificate of Discovery
1/ A holder of certificate of discovery shall have the right to be granted exploration or mining license during the term of validity of such certificate; if lodges application for such license if he meets the necessary requirements provided under Article 4 or 6 of this Regulation.

2/ A holder of certificate of discovery, during the term of validity of the discovery certificate, may transfer his right to an exploration or mining licensee to the minerals he has discovered.


24. An application for a certificate of professional competence for consultancy
An application for certificate of professional competence for consultancy shall be attached with the following information;
1/ If an applicant is a natural  person:
a) his full name, sex, nationality, place of birth and copy of identification card;
b) profession;

c) his residential address;

d) discipline for which certificate of professional competence for consultancy service is requested;
e) the copies of necessary educational qualification document and work experience as specified in the directive to be issued;
f) other information determined in the directive of the Licensing Authority.

2/ If the applicant is a legal person:

a) its name, nationality, legal form;
b) address of its head office;

c) employee profiles such as education, work experience and employment contract as specified in the directive;

d) information specified under paragraph (d) and (f) of sub-article (1) of this Article;
e) authenticated copy of memorandum and articles of association;

f) the name of an official authorized to sign on behalf of the applicant business organization.

25. Issuance of a Certificate of Professional
     Competence for Consultancy Service

1/ An application that meets the requirements provided under Article 24 of this Regulation shall be registered upon the payment of the prescribed application fee.

2/ The eligibility of the attached documents to the application shall be assessed and verified in accordance with the directives to be issued.
3/ Where the Licensing Authority finds the application acceptable, it shall grant a certificate of professional competence in the area of reconnaissance, an exploration, pre-feasibility and feasibility studies, mining as well as for other mining operations.
26.Duration, Renewal and Revocation of a Certificate of Competence for Consultancy

1/ A certificate of competence for consultancy services shall be valid for the period of one year.
2/ The holder of a certificate of competence for consultancy services shall, 30 days prior to the expiry date, have the right to apply in writing for a renewal by effecting payment of prescribed application fee.

3/ The certificate of competence for consultancy services shall be renewed annually.
4/ Where the Ministry  proves that the holder of a certificate of competence for consultancy service failed to carry out his duties in an ethical manner and to use modern technology and good mining operation practice generally accepted in the mining industry, the Licensing Authority may revoke the certificate prior to the expiry of the validity period.
5/ The certificate of competence for consultancy services shall not be renewed, if the Licensing Authority proves that the applicant has failed to comply with professional ethics and technical obligations in accordance with the terms of his certificate of competence.
6/ The Ministry shall notify, in writing, to the applicant his decision of rejection for renewal, or reasons for revocation of the existing certificate of competence for consultancy services within 10 days.

7/ The applicant may apply for issuance of a new certificate of competence for consultancy services after one year from the time he has rectified the causes for revocation.
8/ A person, whose certificate of competence for consultancy services is revoked due to non observance of renewal period, may not be granted another certificate for one year starting from the date of revocation of the previous certificate.
9/ The applicant, pursuant to the directives to be issued by the Licensing Authority, may apply for a renewal of a certificate of competence for consultancy services after rectifying the causes that led the reject his application for renewal.

27.Application for a Certificate of Competence for Technical Service.
An application for certificate of competency for technical service in mining sector shall contain the following:
1/ where the applicant is anatural person:
a) information specified under paragraph (a), (b) and (c) of Article 24 (1) of this  Regulation;
b) copy of educational qualification;
c) documents of previous work experience, if any;
d) documents showing the material preparation of the applicant for intended technical service.
2/ where the applicant is a legal person:

a) information specified under paragraph   (a) and (b) of Article 24(2)  of this Regulation;

b) name, address and nationality of the person who authorized to sign on behalf of the applicant organization;

c) relevant documents of educational back ground, work experience and employment contract made with the employee;

d) documents specified under paragraph (d) of sub-article (1) of this Article;

e) original and a copy of memorandum and articles of association authenticated by relevant authority.


28. Issuance, Duration, Renewal and Revocation of Certificate of competence for technical service
1/ Application to obtain certificate of competence for technical service in mining sector if submitted according to Article 27 of this Regulation by fulfilling the requirements, it shall be registered by ascertaining payment of appropriate fees.
2/ The Ministry shall issue a certificate to the applicant, upon verifying that the application lodged pursuant to sub-article (1) of this Article fulfills the conditions specified for the issuance of a certificate.

3/ A certificate of competence for technical service shall be valid for one year.
4/ The holder of certificate of competence for technical service may apply in writing for renewal 30 days prior to the expiry of the validity period.

5/ The Ministry may renew a certificate after verifying the payment of renewal fees, provided that the applicant has not contravened any provision of the Proclamation, Regulations and directives.
6/ Notwithstanding the provision of sub-article (3) and (5) of this Article, the Ministry may at any time revoke the certificate competence on the following grounds:
 a) where the service delivery is below the standard required by directive;

 b) where there is a breach of any provision of the Proclamation, Regulations and directives. 
7/ Where the Ministry revokes or refuses renewal a certificate of competence, it shall notify the applicant in writing the reason in detail within 10 days.

8/ The holder whose certificate of competence revoked may apply for issuance of a new certificate of competence after one year counted from the date of revocation by rectifying the causes of revocation. 

9/ The holder of a certificate whose certificate is revoked due to non-observance of renewal period may not be granted another certificate for one year starting from the date of revocation of previous certificate.

PART FIVE

RIGHTS AND OBLIGATIONS OF THE LICENSEES


CHAPTER ONE

RIGHTS


29. Infrastructure and other constructions

1/ The licensee may erect infrastructure and other constructions which are necessary for the mining operation.
2/ Infrastructures and other facilities to be built by the licensee shall conform to appropriate designs and technical standards and be constructed, maintained and operated, as per the directives, in a manner to assure their safety and efficient use.
3/ If the infrastructure constructed by licensee is to be used for any commercial purposes, other than public services, the licensee may request the Licensing Authority to allocate the cost of the construction and operation of such infrastructure among such commercial purpose users.

4/ When request is submitted by licensee pursuant to sub-article (3) of this Article:
a) the Licensing Authority shall allocate the cost on the equitable basis taking into account the extent of the use thereof;



b) the cost to be allocated by the Licensing Authority among the users shall be the total annual depreciation and the costs of operation and maintenance of such facilities;
c) the annual depreciation shall be computed by dividing the amount of un-depreciated capital cost of such infrastructure by the numbers of years remaining for the term of the licensee’s license.
5/ Any licensee may use construction minerals from the license area and an area adjacent to the license area only to the extent required for the construction, unless a third party had been granted with an exclusive right over the area prior to the issuance of the license. Where the construction mineral is out of the license area, the licensee shall obtain authorization from appropriate organ. 

30. Disposal of Minerals Obtained during
      Exploration and Reconnaissance


1/ The holder of an exploration and reconnaissance license shall apply to the Licensing Authority and obtain permission to retain or dispose of any minerals he discovers, whether mentioned in the license or not.
2/ The Licensing Authority, as appropriate, may authorize the removal of minerals from the license area, or he may authorize the applicant to retain and dispose of the minerals with the payment of prescribed income tax and royalty.

3/ Without prejudice to sub-article (2) of this Article, if the mineral discovered during reconnaissance or exploration period is not permitted for retention or disposal, it shall remain to be property of Government.


31.Aerial photographs, Images and other information
1/ Any licensee may take aerial photographs, images, geophysics and other aerial data by the permission of concerned Government Office based on the prior information and support of the Licensing Authority.

2/ The licensee shall promptly submit to the Licensing Authority copies of all aerial photographs as well as geophysics and other row aerial data taken pursuant to sub-article (1) of this Article.


3/ Any person shall have access to all available non-confidential maps and data which is found within the Office of Licensing Authority.
  32. Exemption from Customs Duties and Taxes
1/ Up on the request of the holder of exploration license, the Licensing Authority may grant permission to the licensee so as to import small aircraft or helicopter having seat of 6 persons to be used for collecting data and other machineries required for its operation free of customs duties and taxes.

2/ The permission granted pursuant to sub-article (1) of this Article may include provision of support letter to the exploration license holder to get permission from civil aviation authority to fly aircraft required over the license area to collect data.

3/ Any licensee who applies to exercise his right for exemption from customs duties and taxes shall attach with his application a document that verifies he has discharged general obligations of mining operation and minimum work expenditure.

4/ The Ministry shall issue detail directive on exemption of customs duties and taxes as specified under Article 75 of the Proclamation.
5/ Without prejudice to Article 75(7) of the Proclamation, when any mining operation license is terminated or the licensee surrenders his license, any item imported free of custom duties and taxes, may sell upon fulfilling customs formalities or transfer to another person having similar right in accordance with appropriate laws.

6/ The holder of small scale and large scale mining license, pursuant to Article 75 (3) of the Proclamation, in order to import free of custom duties and taxes, shall obtain prior approval from the Licensing Authority by submitting request of items corresponding to the approved work program.
7/ The holder of any mining license, except artisanal mining licensee or construction minerals mining licensee issued for the mining of sand or selected materials, may import consumables which are approved for mining development period in accordance with sub-article (3) of this Article free of customs duties and taxes within five year from the date he starts mining production, where he fail to import them during the time of preparation of mining operation.

8/ Any application for exemption of non-consumable goods from customs duties and taxes, that were not included in the approved work program, shall only be accepted if the application for the amendment of the applicable work program submitted and the Licensing Authority approves thereof.
9/ No application regarding exemption from customs duties and taxes shall be accepted, if the exploration licensee remains with nine months of validity period to expire his license.


33. Samples of minerals
1/ Without prejudice to Article 44 of the Proclamation, any licensee, by the permission of the Licensing Authority and upon payment of prescribed fees, may export samples of minerals which are stated in license and for which local laboratory test is not possible, as appropriate, to conduct laboratory testing or for the purpose of market analysis.

2/ Without prejudice to relevant laws regarding Transaction of Precious Minerals, any person may export samples of minerals to conduct testing or for the purpose of market analysis, where local laboratory test is not possible and by the permission of the Licensing Authority and upon payment of prescribed fees,.

3/ An applicant who requested to export sample of minerals pursuant to sub-article (1) and (2) of this Article, shall present the following information, as appropriate:


a) full name, signature of the applicant and, as the case may be, an application with stamp that describes the type, quantity, purpose of the export and the country where samples to be exported;
b) original copy of recommendation letter from appropriate organization that confirms samples to be exported are necessary for research, if the applicant is an employee of the research institute or a student of higher education abroad;

c) investment license and valid business license from appropriate government body, if the applicant is a business organization;
d) any other person other than those specified under paragraph (b) and (c) of this sub-article who applies to export samples to abroad, shall provide the reasons for the export, and as the case may be any other necessary information as determined in the directive of the Ministry;
e) subject to the approval of its non-commercial purpose by the Licensing Authority, quantity of samples to be used for the test.

4/ When sample mineral are presented pursuant to sub-article (3) of this Article, the Licensing Authority may permit export of the sample by issuing pass letter to the concerned customs authority upon verifying fulfillment of the following conditions:

a) verifying that the sample is the same with the one proposed in the application by conducting physical examination on the sample;
b) where an expert or a head approved the conformity of the samples and sealed it with the submitted container and thereby put his signature and affixed it with a stamp.

5/ The sample and the quantity that may be exported for laboratory testing pursuant to this Article shall be determined by directive.

6/ The holder of exploration license shall retain and submit to the Licensing Authority duplicate of core samples which are collected from geo-chemistry and boreholes of his exploration work.
7/ The request to export samples by the holders of the license issued by Regional Governments shall only be accepted if the holders present recommendation letter from concerned regional authorities.

CHAPTER TWO

OBLIGATIONS

34. Delimitation of Boundaries

1/ Any person who is the holder or applicant of small scale or large scale mining license shall, delimit the area for which the application is to be submitted by placing markers at each turning point along the boundary of the area and along each straight segment.
2/ The markers placed at each turning point and segment along a boundary shall be of masonry, metal or such other similar materials having not less than 25 and 10 cm diameters respectively; and shall have height at least be one meter above the ground and tightly be fixed on the ground. 

3/ The sign indicating the name of the applicant and the registration number of the licensee shall be fixed at each markers placed at each turning point and segment along a boundary.
4/ A licensee shall also adjust the delimited boundary of his license area to reflect any change therein, pursuant to Article 22 of the Proclamation and shall reposition all markers to reveal accurately such change.

5/ The Licensing Authority may cause expert examination and verify the delimitation of boundaries of license area for which application is submitted or already license is issued.


6/ If the expert verifies that the boundaries do not accurately reflect the area requested in an application or specified in the license, such boundaries shall be adjusted accordingly, and the applicant or licensee, shall born the cost of adjustment.

35.Work programs and Expenditure for  an exploration
1/ The work program and expenditure proposed by the applicant for an exploration license shall correspond to an appropriate level of mining operations, taking into account the area for which the application is submitted, the type of minerals, environmental and social impact assessment and community development plan, and meet minimum work and expenditure requirements as specified by directive.

2/ Where the proposed work program and expenditure meet the requirements specified under sub-article (1) of this Article the Licensing Authority shall approve the proposal.
3/ Where the Licensing Authority finds that the proposed work program and expenditure are inadequate, it shall state the comments and notify the applicant in writing to rectify the work program. 


4/ Where the licensee performs work in access and incurs expenditure in any year, the work he performed and expenditure incurred in excess of his obligation may be accepted by taking in to account their appropriateness.

5/ Where the licensee incurs expenditure in excess, without fulfilling the minimum requirements as provided under sub-article (1) of this Article and without getting prior approval from Licensing Authority, such expenditure shall not be considered as expenditure of the mining operation.
6/ Any holder of an exploration license shall submit and get approval from the Licensing Authority for the minimum work program and expenditure of the second and third calendar years by presenting comprehensive environmental and social impact assessment report within 30 days before the end of the first license year.
7/ Without prejudice to the provisions of this Article, any holder of an exploration license may at any time apply and get approval to vary the work program approved in accordance with Article 21 of the Proclamation by adducing the events that prevented the licensee from carrying out the approved work program or the intended variation for more efficient work program.

36.Development, Production Program and Expenditures
1/ The development and production program proposed by the applicant for a small or large or as the case may be for special small scale mining license shall be accompanied with the following documents:

a) evidence showing reserve amount and characteristics of mineral deposits;

b) audit report for pre-production costs;

c)  detail plan of capital and consumable goods and expenditure thereof;

d)  a work plan for how to carry out production and revenue expenditure;

e)  report of environment and natural resource impact assessment and  expenditure  plan for restoration;

f) a plan for infrastructure and expenditure thereof;
g)  the way to equip and mine the deposit in sustainable and commercially significant manner;

h)   other specifications to be determined by directives.

2/ The programs shall be consistent with the objectives specified in Article 36 of the Proclamation, unless a departure there from is justified and gets the prior approval of the Licensing Authority, and shall provide for the development and production of minerals in a sustainable manner consistent with the nature and characteristics of the deposit, projected market conditions and other economic and technical factors.

3/ Where the proposed development and production program meet the requirements specified under sub-article (1) and (2) of this Article the Licensing Authority shall approve the proposal.
4/ Where the Licensing Authority finds that the proposed development and production program are inadequate taking into account all relevant circumstances, it shall state the comments and notify the applicant in writing to rectify the program within 45 days. 

5/ Where the rectified work program fails to meet the comments forwarded pursuant to sub-article (4) of this Article, and if the duration of the license does not exceed 10 years, the licensee shall be given another chance to rectify the program so as to meet the comments, but if the duration of the license exceeds 10 years the license shall be terminated.
6/ Without prejudice to the provisions of this Article, any holder of mining license may at any time apply and get approval to vary the approved work program in accordance with Article 31 of the Proclamation by adducing the events that prevented the licensee from carrying out the approved work program or the intended variation for more efficient work program.

7/ The Licensing Authority, when it deems appropriate, approve the proposed work program or reject the proposal of the work program and notify to the licensee within 30 days. 

37. Employment and Training
1/ Without prejudice to paragraph (h) of Article 36(1)  of the Proclamation, any licensee   may employ a qualified foreign national, if provides evidence that shows a qualified Ethiopian national cannot be found to fill a position and obtains approval and permission thereof from the Licensing Authority.

2/ The Licensing Authority shall provide support to the licensee in order to obtain from concerned government office entry and residence permit for foreign nationals and their dependents in Ethiopia.

3/ A licensee who has obtained a permission to employ a foreign national, in accordance with sub-article (1) of this Article, shall facilitate a condition for a foreign national to work with and to transfer his skills and knowledge to an Ethiopian national.

4/ The foreign national shall be replaced by Ethiopian national where it is verified by the Licensing Authority that the foreign national has been working for enough time to transfer his skills and knowledge to an Ethiopian national.

5/ The employment condition and training provided shall commensurate with the nature and extent of operation; and the operation shall be conducted in efficient and economic manner.

38. Health and safety
1/ Any licensee shall identify any possible causes of occupational injury and diseases against his agents and employees undertake preventive measures, provide appropriate clothing, protective equipment and other health and safety equipment and shall ensure that they are properly trained and qualified for the work.



2/ The licensee shall provide to his agents and employees appropriate health and medical facilities commensurate with the level and nature of operations; transport, store, handle and use explosives and chemicals in accordance with appropriate laws and follow up safe and prudent procedures.


3/ The licensee shall immediately notify the Licensing Authority of any act or occurrence which has resulted in loss of life or injury to any person or which may jeopardize any property or operations and shall immediately take measures necessary to mitigate the impact of such situation.

39. Environmental protection
1/ The holder of an exploration, special small scale, small scale or large scale mining license prior to termination of the license shall progressively restore or reclaim the land covered by a license so that the area has to be completely restored or reclaimed for beneficial future use, in the way specified on his approved report of environmental impact assessment, and environmental management plan.

2/ The licensee shall immediately notify the Licensing Authority and the Ministry of Environment, Forest and Climate Change of any act or occurrence which  may jeopardize the environment or operation, and shall immediately take measure necessary to mitigate the impact of such situation or to rehabilitate thereof.

3/ The holder of an artisanal mining license shall fill pits he dug and plant seedlings instead of trees he cut, observe other obligations stipulated under proper environmental laws and shall not be allowed to use mercury or similar materials in his operation.

4/ After closure of mining operation, the sustainable development and management of the land shall be specified by directives.

40. Environmental impact Restoration fund
1/ The holder of exploration, special small scale, small scale or large scale mining license shall, pursuant to Article 62(2) of the Proclamation, at the first month of each year deposit funds that commensurate with the environmental impact assessment on closed bank account which is subject to the direct supervision of the Licensing Authority.

2/ When the fund deposited became insufficient for closure of mining site upon termination of the mining license, the licensee shall allocate additional fund to finalize the closure.

3/ Whereas, after the licensee clears the area with the expected standard and the Licensing Authority approves same, the reserve fund found in excess, if any, shall be released for the licensee. 

4/ The fund to be deposited by the licensee pursuant to sub-article (1) of this Article to carry out the restoration work during closure shall be computed by dividing the amount of fund for the agreed license period and by depositing same amount every year.

5/ If the closure of mining operation takes place earlier than the license period, the fund subject to closed bank account shall be computed in a manner that correspond with production program.
6/ The fund which is deposited for restoration works pursuant to this Article, shall be released, only when it is proved that the licensee has fulfilled his obligation on the basis of the approved restoration program.

7/ During closure of the mining operation, the licensee with the prior permission of the Licensing Authority shall utilize the fund from the closed bank account to rehabilitate the environment in accordance with the ratified environmental impact assessment plan. 
41. Participation in Community Development
1/ Pursuant to Article 62(3) of the Proclamation, the holder of special small, small and large scale mining license or as appropriate, exploration license, shall participate in Community Development Plan and allocate money for such expenses as follows:
a) during mining development preparation period, lump sum amount from operation cost of the development period shall be paid as follows:

(1) construction or industry minerals 1%;

(2) precious or semi-precious minerals 0.2%;
(3) iron or potash  or metallic minerals 0.1%;
(4) coal 0.7% .
b) during mining period, from annual revenue expenditure or net profit 2%;
c) the fund allocated pursuant to paragraph (b) of this sub-article shall be which ever higher from the annual revenue expenditure and the net profit.

2/ The community development activity carried out by the fund acquired pursuant to sub-article (1) of this Article, shall be implement when the Licensing Authority approves that it is in line with the countries development strategy and to the expected standard; and under the supervision of the community and the respective administrative organ. The report on the appropriation of the fund shall be submitted to the Licensing Authority copied to the licensee as well.
3/ The holder of exploration license shall, as the case may be, allocate community development fund on the basis of negotiation with Licensing Authority.
4/ The boundary of the local community, who are living around the license area and the area to be encompassed under the community development plan and fund administration, shall be determined by the directive of the Ministry.
42. Books , Records and Reports
1/ Any licensee shall maintain records in Ethiopia during the term of the license and current changes with regards to these records as follows:
a) operations, its outputs and expenditures;

b) all employees by category of their labor, conditions of their job and accidents happened;
c) inventories of all minerals produced, stored, treated, transported, exported and sold, along with its quality and prices;

d) inventories of all equipments, machineries, vehicles and other assets.
2/ Any licensee during the term of the license shall carefully maintain duplicate of core samples of minerals taken from the license area and copies of all other relevant mineral samples, technical, laboratory and other reports relating to the license.

3/ The holder of reconnaissance license shall submit to the licensing authority a published general annual report which includes the details specified under paragraph (a) and (b) of sub-article (1) of this Article within 30 days prior to the end of each license year.
4/ The holder of an exploration license shall submit to the Licensing Authority the general annual report which includes the following within 30 days prior to the end  of license year:
a) the information’s specified under paragraph (a), (b) and (d) of sub-article (1) of this Article;
b) on the basis of the approved work program, as the case may be, remote sensing undertaken at different levels, geology, geophysics, geochemistry works, excavations, and other mining works and the result thereof, maps, hard and soft copies of raw data and other similar information;

c) detail expenditure incurred to undertake works specified under paragraph (b) of sub article (4)  of this Article, and information maintained at each category of expenditure;
d) the number of employees deployed to each category of works, the total number of working days, work conditions and accidents;
e) inventory of all equipments, machineries, vehicles or other materials physical asset employed for the mining works and which are imported with or without custom duties and taxes and any change there in;

f) other information determined by the directives of the Licensing Authority, as may be necessary.
5/ The holder of retention license shall submit annual report to the Licensing Authority, within 30 days after the expiry of each year, which specify change made to the original information submitted during application for license pursuant to Article 5 (4) ,(5) and (6) of this Regulation and the information still continued to prevail after the mining operation and other information determined as important by the Licensing Authority.

6/ The holder of a small scale or a large scale mining license shall submit summary reports to the Licensing Authority on a  quarterly basis, within thirty days after the end of each period which contains the following:

a) the information specified under paragraph (c) and (d) of sub-article (4) of this Article;
b) all operations, including the geological works and the progress and results thereof, and the conditions relating to production of minerals and any change in the reserve of the deposit;


c) an inventory of all minerals produced, stored, treated, transported, sold and exported and destination and nationality of buyers for all exports, revenue collected from sales, the amount of royalty and its computation;

d) on the basis of environmental management plan, works carried out for community development and restoration and expenses thereof;
e) detail of expenditure incurred, in respect to its category, to carry out works specified under this sub-article;
f) Such other information as the licensing authority may determines by the directives.
 7/    The holder of a special small scale mining licensee shall submit to the Licensing   Authority within 60 days after the end of each year; information specified  under paragraph (a), (c), (d), (e) and (f) of sub-article (6) of this Article, annual general report with income tax and current audit report approved by external auditor.

8/ The holder of a, small or large scale mining license shall submit; information specified under sub-article (6) of this Article, annual general report with income tax and government participation interest, current audit report approved by external auditor to the Licensing Authority within 60 days after the end of each quarter and each year.

43. Presentation of License.

Any licensee shall produce the license or a copy thereof certified by the Licensing Authority whenever so requested by an appropriate public officer, law full occupant of the license area or other interested person by being in the license area.

PART FIVE

ROYALTY, INCOME TAX, FREE GOVERNMENT PARTICIPATION
 INTEREST AND OTHER PAYMENTS


44. Royalty, Mining Income Tax and Free Government Participation Interest.

1/ The royalty payable by  holder of large scale mining license, pursuant to Article 65 (2) of the Proclamation, shall be computed and levied ad valorem, at the production site and shall be paid on  quarterly basis within 30 days after the end of the period to which it relates.

2/ Any holder of large scale mining license shall, as specified in the agreement, within the time to declare profit and loss statements in his balance sheets, make payment annually for the concerned revenue collecting authority, as stipulated under Article 67 of the Proclamation and provisions of Income Tax Proclamation and shall submit the receipt thereof to the Licensing Authority.
3/ Any holder of large scale mining license, from the net income pursuant to Article 72 of the Proclamation shall pay 5% (five percent) of Government equity annually to the revenue collecting authority and submit the receipt of payment to the Licensing Authority. Where the profit is not distributed among beneficiaries, 5% free equity of the Government shall be paid.


4/ The Licensing Authority, as the case may be, shall examine the necessary documents of the licensee in order to confirm the correctness of the payment effected pursuant to sub-article (2) and (3) of this Article.

45. Reduction, Temporary lifting or Waiver of  the liability to pay Royalty


After verifying the existence of the following reasons, the Licensing Authority may recommend to the Council of Minister or the concerned Regional Authority reduction, temporary lifting or waiver of the liability to pay royalty of a licensee who commence mining:

1/ where there are international adverse market conditions unforeseen during the issuance of a license and results sharp price reduction for not less than a year;

2/ any mineral which Government designates as strategic minerals and the production thereof by itself found to be adequate;
3/ when licensee produces metallic minerals like iron by adding value in a way it significantly contribute for national economy.

46.License Fees

1/ The license fees to be paid by any applicant, for each specific block of a license, pursuant to Article 71 of the Proclamation and Article 14 of this Regulation, shall be as follows:

a) Reconnaissance license …….Birr 3,904

b) Exploration license ………….Birr 4,837

c) Retention license…………. …Birr 9 ,801

d) small scale industrial and construction mining license  ……………….Birr 4,207

e) large scale industrial and construction mining license…………….….Birr 5,132


f) precious, semi-precious, metallic and other minirals of small scale mining license ……………..………....Birr 7,520

 g) precious, semi-precious, metallic and other minirals of large scale mining license   ………………..……...Birr 8360



2/ The renewal fee to be paid by any license holder for each block of a license, pursuant to Article 71 of the Proclamation and Article 14 of this Regulation, shall be as follows:

a) Exploration license……….. Birr 3,058

b) Retention license ……………Birr 10,191

c) Small scale industrial and construction mining license ………….…….Birr 2,869

d) Large scale industrial and construction mining license …………….…Birr 4078



e) Precious, semi-precious, metallic and others minerals of small scale mining license …………………………….…Birr 6117

f) Precious, semi-precious, metallic and others minerals of large scale mining license …………..……………Birr 8411

3/ Except the mining license of large scale construction  minerals, the amount of  license fees to be paid for licenses granted as per Article 54 (1) of the Proclamation shall be determined by the laws of the Regional States.
47. Other payments
1/ Applicant shall pay service fees provide under the provisions of this Article to obtain different services provided by the Licensing Authority.

2/ For registration of application or documents the following fees shall be paid:
a) registration of application for mining works license……………….…Birr 401

b) registration of application for transfer of license rights  ……………….….Birr 864


c) registration of application to get certificate of professional competence for consultancy service………….…Birr 100
d) registration of application to get certificate of competence for technical service……………………..…Birr 1000
e) registration of application to get certificate of discovery ………… Birr 10
f) registration of document…………Birr 50
3/ For receiving different documents the following fees shall be paid:
a) license document per/page……..Birr 20

b) certificate of professional competence for consultancy service …              .Birr 400

c) certificate of competency for technical service …………………………Birr 2659

d) certificate of discovery per/page  …………………………………Birr  200
e) substitute of lost, burned, damaged or stolen license or certificate per/page ……………………………….....Birr 30

f) additional copy of original license or certificate……………………...Birr 300
g) additional copy of a certificate of professional competence for consultancy service ………………….……..Birr 300
h) additional copy of a certificate of competency for technical service ………………………………....Birr 460

i) a renewed license or certificate…Birr 200

4/ A service fee for application to export sample minerals shall be determined by the Council of Ministers Regulations based on the study of the Ministry by taking into account the weight and type of the mineral.

5/ A service fee to obtain copies of maps pertaining to mining operations and such other services not specified under this Article shall be determined by the Council of Ministers Regulations based on the study of the Ministry.

6/ Except the mining license of large scale construction  minerals, fees for licenses and other services provided pursuant to Article 54 (1) of the Proclamation shall be determined by the laws of the respective Regional State.

48. Failure to Pay or Late Payment
Without prejudice to any other recourses that the Licensing Authority take pursuant to the provisions of  Part Six of this Regulation, failure to pay or delay of payments specified under Article 67 of the Proclamation and Article 46 of this Regulation shall subject to a fine of 2% for each month or part thereof for the amount remains unpaid.

PART SIX

OFFENCES AND ADMINISTRATIVE PENALTIES

49. First Level Offences and Administrative  penalties
1/ Any person who:
a)  without prejudice to the provisions of Article 7(3) and (5)  of the Proclamation, undertakes mining operations and transport minerals without having obtained the relevant license;

b)  has submitted false or fraudulent information in connection with the application relating to a license, renewal, notification of discovery, or certificate of competence;
shall be punishable with a fine from Birr 300,000 up to Birr 500,000 and the mineral produced without having license shall be confiscated.


2/ Any licensee who:

a)    conducts mining operation in a reckless or willfully improper manner or breaches any material term or conditions of his license;

b)   fails to comply with an order and the financial obligations prescribed under Article 69 of the Proclamation;

c)    commits any kind of fraudulent act in relation to rights emanated from a license or has submitted false information or commits fraudulent act in connection with mining operations or undertakes mining activities not envisaged in the license;
d) breach the environmental, safety and health standards or fails to observe an obligations related to his mining operation; or

 e)  fails materially to meet administrative and fiscal obligations related to his mining operation;
shall be punishable with a fine from Birr 150,000 up to Birr 200,000.

50.Second Level Offences and penalties
Any licensee who:

1/ fails to maintain, as the case may be, books and records required under sub-article of Article 42 (1) of this Regulation or other documents or materials required or maintains books and records which are materially incorrect or incomplete;

2/ conducts mining operations in a negligent manner or in a way which endangers the health or safety of any person, the environment and nature, a deposit, or fails to observe his duties in respect to community development or fails to observe generally accepted good mining practices or fails to observe an obligation of license;

3/ fails to grant a duly authorized supervisor or official of the Licensing Authority access into the license area, or to any other site or premises of the mining operations or to his books, records, other documents or materials, or fails to carry out a lawful order or instruction of such official;



4/ where the holder of a certificate of competence for consultancy and technical service failed to carry out his duties in an ethical manner, to use modern technology and generally accepted good mining operation practices in the mining industry;
shall be punishable with a fine Birr 50,000 up to Birr 70,000, if immediately takes remedial action to correct the violation after receiving notice; if the person concerned does not take remedial action immediately, the amount of the fine shall be doubled; if the violation results in an imminent or continuing danger to the health and safety of any person, the environment or a deposit, the Licensing Authority may immediately order suspension of mining operations license pending the correction of the violation, and the license shall be suspended until such act, omission or condition is rectified.

51.Third Level Offences and penalties
Any licensee who:
1/ fails to maintain books and records in a complete, accurate and current manner, excluding such deficiencies to maintain books and records which are materially incorrect or incomplete;

b) fails in a timely manner to file all reports and other documents  or to give notices required;

c) fails to carry out mining operations in a proper and prudent manner or to observe regulations or directives but which failure does not endanger the health or safety of any person, the environment or a deposit;


d) fails to maintain information in connection with mining license either in Amharic or English language;

shall be punishable with a fine from Birr 30,000 up to  Birr 50,000 if fails to take remedial measure to correct the violation immediately after receiving notice.


PART SEVEN

MISCELLANEOUS PROVISIONS

52.Shortening or Extension of time and Variation   of Production Program
1/ Notwithstanding some provisions of this Regulation, the Licensing Authority may, for good cause without jeopardizing the rights of a licensee or negatively affecting his ability to perform the duties and obligations specified under the license or the Proclamation, shorten or extend periods specified within this Regulation to execute certain activities.

2/ Without prejudice to sub-article (1) of this Article, any licensee by demonstrating the events that prevent him from carrying out the approved work program, may apply for an extension of a license period; where the Licensing Authority satisfied with the adequacy of the reason provided, may grant extension of license period; if it rejects the request for an extension it shall notify same in writing within 30 days by stating the reason for refusal.

3/ The Licensing Authority if ascertains with concrete evidence the improvement of global situation with regard to market conditions, economic factors and technology, it may require the licensee to improve the development and production program approved pursuant to Article 11 of this Regulation; provided, however, that such variation shall not jeopardize a licensee to perform his duties and obligations specified under the license or the Proclamation.
53.Extending or Shortening the Period to Commence Mining

Without prejudice to the provision of Article 30 of the Proclamation, the Licensing Authority may extend or shorten the two years period to commence the small or large scale mining based on the following criteria:


 1/ extension of period where:
a)  the mining  is carried out by digging from the primary deposit by under-ground mining method;
b) it is difficult to mine, because of the complex nature of the mineral; or

c)  the mineral requires special procedure and passes through different methods to mine.


2/ shortening of period where:
a) the primary  mineral is extracted by simple open-pit method;

b)  the mining is from placer minerals;

c) the nature of the mineral is simple for mining; or

d) the method of mining of the mineral do not pass through different procedure.

54. Government Assistance
1/ Pursuant to Article 77(1) of the Proclamation, the Licensing Authority may, where it deems appropriate, provide assistance for small and micro enterprises engaged in precious and semi-precious minerals operation by  holding an artisanal mining license in the following manner:

a) identify and delimit mineral deposits for mining operations only to be undertaken by artisanal miners;


b) provide technical and administrative assistance and training;


c) assist in obtaining financial support and loan for such operations;

d) assist in the voluntary formation and the functioning of small and micro enterprises producers;

e) advise on the treatment, transportation, storage and marketing of minerals produced by such licensees;


f) provide assistance to those who have been engaged in operation of precious and semi-precious minerals by holding an artisanal morning license, if the licensee are adequately prepared to transform to the stage of special small scale mining;
g) provide assistance for the licensees engaged in adding value on precious minerals and supply them for market.
2/ The Licensing Authority shall, as appropriate, by assessing the socio-economic interest of the country, facilitate conditions necessary for creation of work relationship, experience sharing, training and other supports for an exploration and small scale mining license holders to obtain finance, acquire an improved technology through bilateral agreements with governmental and non-governmental organization. 

55.Mining Operations Advisory Council
1/ Pursuant to sub-article (2) of Article 55 of the Proclamation, to advise the Ministry, the Mining Operations Advisory Council (hereinafter the “Council”) is hereby established.
2/ The Council shall have Chairperson and members drown from the following organs by the Minister and be assigned by the Government:
a) Ministry, regional mining bureau or agency;
b) the concerned environmental protection organs of federal government or regional states;
c) Ministry of Trade,
d) Ministry of Finance and Economic Cooperation;
e) Ministry of Industry,
f) Ethiopian Revenue and Custom Authority;
g) domestic investor playing significant role in the mining sector;
h) non-governmental organizations;
i) professional associations related with mining operations;  and
j) members from other appropriate organs when ever necessary.


3/ The Council shall have the powers and responsibilities to:
 a) provide advise to the Ministry on amendment of policies and laws on how to make the countries’ mining sector competitive in respect of the contemporary international mining industries standards, thereby increasing the role of investors in the mining sector by creating an enabling environment and ensuring the national interest of the country in sustainable manner;
b) render advise to the Ministry on how to settle disputes arising around the mining areas with the local community and administrative organ at each level in relation to mining operations.

4/ Meeting of the Council:
a) the Council shall have a regular meeting twice a year, provided, however, the Chairperson may at any time call an extra-ordinary meeting whenever necessary;

b) there shall be quorum where more than half of the members are present at a meeting;

c) recommendations of the Council shall be passed by a majority vote; in case of ties, the Chairperson shall have casting vote;
d) without prejudice to the provisions of this sub-article the Council may adopt its own meeting rules of procedures.

5/ The term of members of the Council shall be five years; provided, however, a member may serve for second terms if recommended by the Minister and re-assigned by the Government.


6/ Government may remove member of the Council at any time on any ground and substitute or member of the Council may resign voluntarily or for any reason.

7/ The Council shall be accountable to the Prime Minister.

56. Powers and Duties of the Inspectors
1/ The Licensing Authority shall assign inspectors to inspect the technical and administrative aspects of mining operations.

2/ The inspectors assigned pursuant to sub-article (1) of this Article shall show their identification cards and special identification cards pertaining to their inspection duties issued by the Licensing Authority as they inspect operation.

3/ Inspectors shall inspect business establishments at government official working hours.

4/ Notwithstanding  sub-article (2) of this Article, inspectors conduct inspection during out of official working hours shall possess a letter issued by the Licensing Authority for such purpose.

5/ The other officials of the Licensing Authority may carry out necessary inspection activities when special delegation is given to them by the Licensing Authority.


57. Repealed Laws
The Council of Ministers Mining Operations Regulation No. 182/1994 is hereby repealed and replaced by this Regulation.
58.Effective Date
This Regulation shall enter in to force on the date of its publication in the Federal Negarit Gazeta


Done at Addis Ababa this 24th   Day of January, 2018.

HAILEMARIAM DESALEGN


PRIME MINISTER OF FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA




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