Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

FIFTEENTH CONGRESS
Third Regular Session

no, 8972

HOUSE BILL NO.

Introduced by Hon. ANGELO B. PALMONES.

EXPLANATORY NOTE

Minerals are one of the most important resources of the Philippines. For gold alone,
the country is the 18 largest producer of this metal and in 2011 the production was over a
million troy ounces worth USS1.6 billion at current prices’. In the process of mining, despite
the environmental safeguards most especially the required environmental impact
studies/assessment needed prior to the issuance of an environmental compliance certificate
(ECC) there is still destruction of forest resources and biodiversity. The guarantee fund
deposited by mining operators is basically for the rehabilitation of mined areas,

More than 3 million hectars of terrestrial areas have been proclaimed as protected
areas (PA). Each PA has a protected area management plan which the Protected Area
Management Board is mandated to implement, Unfortunately, most PAs do not have the
financial capability to implement their PA management plans, To safeguard the biodiversity
found in protected areas there is a need to implement the PA management plans and there
should be sufficient funds for this. The 10% proposed share of the fines and penalties that
accrue to government from erring mining operators shall go into the implementation of PA
management plans

Section 8 of Executive Order No. 79 otherwise known as “Institutionalizing and
Implementing Reforms in the Philippine Mining Sector, Providing Policies and Guidelines
‘To Ensure Environmental Protection and Responsible Mining in the Utilization of Mineral
Resources” provides for value adding activities and development of downstream industries
for strategic metallic ores. This is laudable because it will create job opportunities for
Filipinos in addition to increasing the value of the processed minerals. However, RA No.
7942 does not mandate mining permitees to establish and operate processing plants. To
institutionalize the local processing of mineral ores mining operators should be obliged to
establish and operate local ore processing plants, even at least primary processing,

ANGELO B. PALMONES
Represeqtative, AGHAM Party-list

' Pilippines’ black market is China's golden councction. August 22,2012, Business World


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
FIFTEENTH CONGRESS
Third Regular Session

No. 6972

HOUSE BILL.

Introduced by Hon, ANGELO B. PALMONES.

AN ACT AMENDING REPUBLIC ACT NO. 7942 OTHERWISE KNOWN AS “AN
ACT INSTITUTING A NEW SYSTEM OF MINERAL RESOURCES
EXPLORATION, DEVELOPMENT, UTILIZATION, AND CONSERVATION” AND
FOR OTHER PURPOSES

Be it enacted by the Senate and the House of Representatives of the Philippines
in Congress Assembled:

Section 1. Use of fines and penalties ~ Section 5 of Republic Act No. 7942 shall be amended
as follows:

Section 5, Mineral Reservations. When the national interest so requires, such as
when there is a need to preserve strategic raw materials for industries critical to
national development, or certain minerals for scientific, cultural or ecological value,
the President may establish mineral reservations upon the recommendation of the
Director through the Secretary. Mining operations in existing mineral reservations and
such other reservations as may thereafter be established, shall be undertaken by the
Department or through a contractor: Provided, That a small scale mining agreement
for a maximum aggregate area of twenty-five percent (25%) of such mineral
reservation, subject to valid existing mining quarrying rights as provided under
Section 112 Chapter XX hereof. Ail submerged lands within the contiguous zone and
in the exclusive economic zone of the Philippines are hereby declared to be mineral
reservations

A ten per centum (10%) share of all royalties and revenues to be derived by the
government from the development and utilization of the mineral resources within
mineral reservations as provided under this Act shall accrue to the Mines and
Geosciences Bureau to be allotted for special projects and other administrative
expenses related to the exploration and development of other mineral reservations
mentioned in Section 6 hereof.

A TEN PER CENTUM (10%) SHARE OF ALL FINES AND PENALTIES
IMPOSED FOR ANY VIOLATION ON ERRING MINING OPERATORS
SHALL ACCRUE TO THE GENERAL FUND OF THE INTEGRATED
PROTECTED AREAS FUND (IPAF) FOR THE IMPLEMENTATION OF
PROTECTED AREAS MANAGEMENT PLANS.



Section 2. Local processing of minerals ~ Henceforth, export of unprocessed mineral ores i
hereby prohibited and all mineral ores shall undergo local primary processing before they are
allowed to be exported. Consequently, a mandatory requirement in the application for a
mining permit for companies planning to export processed ores is a processing plant.

Section 3. Fines and penalties ~ Any person who is found to be guilty of exporting
unprocessed mineral ore is liable to a fine of One Hundred Thousand Pesos (P100,000) or an
imprisonment of not longer than 2 years or both as the Court may deem fit for the offense. In
ie the guilty party is a juridical person the officers and members of the board of the
company are liable to a fine of not less than Five Hundred Thousand Pesos (P500,000) each
or imprisonment of not less than 4 years or both as the Court deem fit.

Section 4. Implementing rules and regulations- The Department of Agriculture shall prepare
and issue the implementing rules and regulations of this Act within 90 days from the approval
of this Act

Section 5. Separability Clause. If any of the provision of this Act is held or declared to be
unconstitutional or invalid by a competent court, the other provisions hereof shall continue to
be in force

Section 6. Repealing Clause. All laws, decrees, orders, rules and regulations or portions
thereof, inconsistent with this Act are hereby repealed or modified accordingly.

Section 7. This Act shall take effect 15 days afler its complete publication in two newspapers
of general circulation.

Approved