Republic of the Philippines
HOUSE OF REPRESENTATIVES

(25 AN |

Quezon City :
SIXTEENTH CONGRESS
First Regular Session vL
984
HOUSE BILL NO.

Introduced by HON. TEDDY BRAWNER BAGUILAT, HON. CARLOS M. PADILLA,
HON. ARLENE ‘KAKA’ J. BAG-AO, HON. ELEANDRO JESUS F. MADRONA, HON.
WALDEN F. BELLO, HON. IBARRA M. GUTIERREZ III, HON. RUFUS B.
RODRIGUEZ, and HON. MAXIMO B. RODRIGUEZ, JR.

EXPLANATORY NOTE

‘The Philippines is endowed with vast natural resources, including minerals, which form part of our
nation’s wealth and patrimony. Such wealth should serve the national economy for the benefit of the
people and be shared equitably. The regulated and rational use, development and exploitation of
minerals are consistent with sustainable development principles and geared towards genuine
industrialization and development of agriculture.

‘The country’s mining industry was supposed to have significantly contributed to national
development. Instead, it created a massive social divide and detrimental environmental impacts.

‘The present mining law (Republic Act 7942) has clearly failed to address such impacts and even
failed to enhance national growth in a way that effectively safeguards the environment and protects
the rights of affected communities. The industry under the present framework of the law is
essentially extractive which has resulted to the continuing depletion of the country’s nonrenewable
resources, without giving back an equitable share of benefits.

Th the last three years alone, at least four major disasters related to mining occurred irreparably
damaged various ecosystems.

In June 2012, fish kill in Lake Bito, a rich fishing ground in Leyte, was traced to mine wastes from
Nicua Mining Corp. which was then operating in another village in MacArthur, Leyte. The bureau
suspended Nicua operations following the fish kill. \

On August 1, 2012 Philex Gold and Copper Mine in Padcal, Benguet leaked spilling waste into the
nearby Balog cteek, which flows into the Agno River and the San Roque dam. On November 25,
2012, Gitinickel Mines and Development Corporation was issued a notice of violation by the


Department of Environment and Natural Resources after siltladen water spilled from its silt pond
No. 2 at its Toronto Mining Area in Barangay San Isidro, Narra, in Palawan. On February 13, 2013,
Semirara Coal Mine’s section of a wall in Panian, Caluya, Antique collapsed killing a number of
people while others are missing. This is not to count the previous major mining disasters starting
with the notorious Marcopper tragedy that lett 1: government still begging for remunerations.

Mining sites likewise continue to invite conflict, violence and human rights violations: families
massacred, objecting community leaders killed or intimidated, sacred grounds bulldozed, process of
Free Prior and Informed Consent (FPIC) of indigenous peoples undermined or vitiated, houses
illegally demolished, communities forcibly resettled. 1

‘Timuay Lucenio Manda of Bayog, Zamboanga del Sur survived an ambush that killed his son in
September 2012.

In October 2012, Juvy Capion and her children Jordan and John were killed when their hut was
strafed with gunfire while they slept in their hut in Kiblawan, Davao del Sur. Another daughter, 4-
year old Vicky, was wounded and managed to escape. This killing happened during a military
manhunt for Daguil Capion, Juvy's husband and one of the Baan leaders who fesisted the
encroachment of a mining company into their ancestral domains.

On December 7, 2012 Cheryl Ananayo, a member of the Didipio Earthsavers’ Multipurpose
Association (DESAMA), and her cousin-in-law Randy Nabayay, were shot and killed while headed
to Didipio town. On the same day, Rolando Quijano, a farmer and active member of the Alliance of
Farmers Union in Zamboanga Del Sur (AFUZS) was shot to death at around 12:00 noon at Purok
4, Ocapan, San Miguel in the province of Zamboanga Del Sur.

On January 29, 2013 Kitari Capion, the brother of Daguil, was also killed, along with two
companions, at Barangay Bong Mal in Davao del Sur. The killing was allegedly led by a Captain of
the Philippine Army.

All these are either key leaders or are related to leaders organizing the opposition against mining
projects adversely affecting their communities.

‘The mining industry also failed to contribute significantly to the Philippine economy. According to
the Mines and Geosciences Bureau in 2012, mining contributed a measly 0.7% to our Gross
Domestic Product (GDP) and employed an insignificant 0.7% of the total labor force. In the first
quarter of 2013, when the Philippine GDP recorded an impressive 7.8% growth, the mining
industry contracted.

Indeed the industry and its governing law failed to ensure the constitutionally guaranteed rights of
the people to a balanced and healthful ecology, to social justice in all phases of national
development, to a self-reliant and independent economy effectively controlled by Filipinos, and
other important rights.

If mining is to be pursued, the current mining policy framework should be overhauled in such a way
that social and environmental safeguards are clearly established to meet the needs of our people now
and in the future. Priorities should be towards sustainable development and food security, where the


development, to a self-reliant and independent economy effectively controlled by Filipinos, and
other important rights.

If mining is to be pursued, the current mining policy framework should be overhauled in such a way
that social and environmental safeguards are clearly established to meet the needs of our people now
and in the future. Priorities should be towards sustainable development and food security, where the
benefits from mining are clearly established even before considering exposing our land and our
people to the risks and hazards of mineral extraction.

‘This bill is therefore proposed to take the place of the current mining law. It is the product of years
of consultation with mining-affected indigenous peoples, communities and stakeholders, as well as
experts, whose invaluable thoughts need to be considered in crafting a law that is truly responsive to
the aspirations and welfare of the Filipino people. The bill posits that itis impossible and unwise to
separate mining from issues of resource use, water, food security, environment, human rights,
indigenous people’s rights and rights-based economic development.

This bill seeks to guarantee that the exploration, development and utilization of mineral resources
will primarily benefit the Filipino people; prioritizes sustainable livelihood choices for communities;
gives utmost importance to food security and livable conditions for the people; ensures that the
gains from the mining industry would be maximized while preventing or mitigating its adverse
effects; recognizes that the issue of environment and sustainable development is local and thus
prioritizes local participation in decisions surrounding mining; ensures the protection of human
rights of communities and individuals; and imposes harsh penalties for the violation of its
provisions.

‘The immediate passage of this bill is therefore earnestly sought.

aay See
LAT LOS M. PADILLA

—_—-

ELEANDRO JESUS F. MADRONA

er

WALDEN F. BELLQ 1B:

RUFUS B. RODRIGUEZ MAXIMO B. RODRIGUEZ, JR.


Republic of the Philippines
HOUSE OF REPRESENTATIVES.

Quezon City

SIXTEENTH CONGRESS
First Regular Session

984

HOUSE BILL NO.

Introduced by HON. TEDDY BRAWNER BAGUILAT, HON. CARLOS M. PADILLA,
HON. ARLENE ‘KAKA’ J. BAG-AO, HON. ELEANDRO JESUS F. MADRONA, HON.
WALDEN F. BELLO, HON. IBARRA M. GUTIERREZ Ill, HON. RUFUS B.
RODRIGUEZ, and HON. MAXIMO B. RODRIGUEZ, JR.

AN ACT
‘TO REGULATE THE RATIONAL EXPLORATION, DEVELOPMENT AND.
UTILIZATION OF MINERAL RESOURCES, AND TO ENSURE THE EQUITABLE
SHARING OF BENEFITS FOR THE STATE, INDIGENOUS PEOPLES AND LOCAL
COMMUNITIES, AND FOR OTHER PURPOSES

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

CHAPTER I
DECLARATION OF POLICIES
Section 1. Short Title. This Act shall be known as the “Philippine Mineral Resources Act of 2012”.
Section 2, Declaration of Policy. It is hereby declared the policy of the State to:

2) Maintain peace and order, protect life, liberty and property and promote the general welfare;

b) Advance the medium- and long-term needs of the Philippines;

Encourage the advancement of the industry's technology with emphasis on existing
indigenous knowledge, research and development;

@ Protect and advance the right of the people to a balanced and healthful ecology in accord
with the rhythm and harmony of nature;

©) Value the dignity of every human person and guarantees full respect for human rights;


8) Promote social justice in all phases of national development;

® Recognize and promote the rights of indigenous culnaral communities within the framework
of national unity and development and protect the right to self-determination of the
indigenous and Moro peoples;

h) Protect and promote the right to health of the people and instill health consciousness among
them;

) Pursue an independent foreign policy. In its relations with other states the paramount
consideration shall be national sovereignty, territorial integrity, national interest, and the right
10 self-determination;

) Develop a self-reliant and independent national economy effectively controlled by Filipinos;

8) Ensure the autonomy of local governments;

}) Give highest priority to the enactment of measures that protect and enhance the right of all

the people to human dignity, reduce social, economic, and political inequalities, and remove
cultural inequities by equitably diffusing wealth and political power for the common good

m) Encourage non-governmental, community-based, or sectoral organizations that promote the
welfare of the nation; and

8) Adopt and accept the generally accepted principles as embodied in the International
Covenant on Civil and Political Rights, Intemational Covenant on Economic, Social,
Cultural Rights, UN Declaration on the Rights of Indigenous Peoples, UN Convention on
Biodiversity and other international accords on human rights, labor rights, the rights of
women and children, and the protection and preservation of the environment, of which the
State is a party.

Section 3. The State shall formulate a National Industrialization Program pursuant to the principles
of agricultural modernization, development of industrial and manufacturing industries, and rational,
sustainable, and equitable development of the national economy. ‘The State shall, therefore, promote
the development of mineral processing to maximize the benefits or value-added from mining.
‘Towards this end, it shall encourage the establishment and development of manufacturing plants
that will utilize locally processed mineral products as well as mining firms that will process mineral
ores first for domestic purposes and before exporting them to other countries.

Pursuant to the foregoing, the State shall implement a Mineral Management Plan that provides the
framework for the utilization and management of the country’s mineral resources, which will
address the needs of the domestic economy and uphold the rights of industry workers, indigenous
peoples and local communities.

Section 4. The judicious stewardship of our mineral resources, as well as its exploration,
development and utilization shall comply with the following principles:


a) The current exportorientation of mining is hereby reversed and a domestic needs-based
development of the industry shall be pursued by the State as a step towards achieving
genuine economic development;

b) The mining industry shall be geared towards national industrialization and shall be built for
the production of raw materials such as base metals, basic chemicals and petrochemicals
needed by the basic, medium and heavy industries to produce as much consumer,
intermediate and capital goods with the country’s stock of finite mineral and non-mineral
industrial raw materials and in the process provide jobs to the country’s vast human
resources;

) The community shall actively participate in the stewardship of mineral resources.
Community-based initiatives shall be encouraged and supported;

4) The State and its members shall develop its human resources and encourage the evolution of
its own appropriate technologies. The State shall provide the appropriate support and
protection to Filipino corporations to further develop and increase theit participation in the
industry. All mining industry investments shall be mutually-beneficial and help achieve the
specific target and goals of the National Industrialization Program. ‘To come up with the
large capital requirement for mining, the State must use local sources such as but not limited
to the granting of incentives and financial aid to local private sector investors, re-channeling
of government budget allocations for foreign debt payments and military expenditures, and
the proceeds from the government shares of the Malampaya Natural Gas Project;

©) The State shall allow, in exceptional cases, foreign corporations to invest in the mineral
industry. Based on the National Industrialization Program and the country’s capability and
capacity, the government must identify the mineral areas where foreigners can help and
invest subject to rigorous screening and strict regulations as provided in this Act and related
laws. The participation of foreign companies in the critical stages of minerals extraction and
processing shall be in accordance with a mandatory program or agreement for technolopy
transfer and equity shares that do not exceed 40 percent of the full capital requirements;
Provided, ‘That capital accumulation and reinvestment within the country shall be primarily
encouraged over profit repatriation by the foreign companies and that foreign mining
corporations, their principals, local firms and conduits that have a bad track record in the
Philippines are banned from investing in the country;

) In land and water use, the production of sufficient food free from pollution towards food
security shall always be the priority;

) Long-term mining development shall be programmed by the State in accordance with the
country’s availability of resources, capability and well being of the people, technological
capacity and people's acceptability. ‘The right of Muslim Filipinos and indigenous peoples to
self-determination and ancestral domain shall be recognized and their collective property
rights are guaranteed by this Act;

b) Job security, adequate wages, benefits, and safe working conditions for mine workers shall
be ensured in state and privately owned mining corporations. Their right to organize and


k)

form their own associations, to collective bargaining and to strike shall be upheld. ‘The state
will strictly prohibit forced and child labor in the industry;

Small-scale mining operations shall be supported and regulated by the state, The state will
encourage the formation of cooperatives among small-scale miners and provide financial and
technical support to develop the labor-intensive and upgrade the backward technologies into
a more efficient and less environmentally destructive mining process. Whenever small- scale
mining are stopped, alternative and sustainable livelihood shall be provided to the small-scale
miners.

Mining operations shall not in any way create or exacerbate conflicts. In no instance shall the
Armed Forces of the Philippines (AFP), the Philippine National Police (PNP) and private
security and paramilitary groups be used to coerce or force the entry and protection of
mining operations;

Mining industry research and development shall focus on harnessing more economically-
efficient and less environmentally-destructive methods. The advanced technologies from
other countries that are proven to be appropriate locally shall be adopted in the industry;

‘All mining operations shall be strictly regulated to ensure the domestic processing of mineral
ores up to the secondary and tertiary stages of industrial production to develop our own
basic and medium industries. Recycling programs and substitution in the use of minerals
shall be incorporated in the overall plan of mining development to reduce mine waste and
pollution, and mining rehabilitation techniques. Indigenous technologies that are relevant
and appropriate, particularly with respect to the domestic processing of minerals shall be
promoted, hamessed, expanded and upgraded;

‘The State and its members shall share in the burden of satisfying the need for mineral
resources primarily through reusing and recycling existing mineral products. Ecologically-
sound practices at all stages of mining shall be promoted. Mining technologies such as
open-pit mining and submarine mine tailing disposal methods that are banned abroad
and/or proven inappropriate in countries like the Philippines must all be banned.
Environmental standards shall be set to ensure the protection and efficient utilization of the
country's mineral resource base. Ecological considerations in mining development shall be
given due emphasis and attention to substantially eliminate destructive effects that certain
mining industrial processes might have on the people's health and the environment.
Monitoring mechanisms with strong participation from the local communities will be
instituted; ;

Mining in environmentally-critical areas such as small island ecosystems, primary and
secondary forests and watersheds shall be banned. Dumping of mine wastes and stailings to
rivers, lakes and seas are prohibited; The integrity of the environment shall not be
‘compromised; and

Areas affected by mining shall be rehabilitated, including abandoned mines. Violators shall
be strictly punished and made to pay heavy compensation to the State and the affected
communiti



Section 5. ‘The exploration, development and utilization of natural resources must comply with the
principles of intergenerational responsibility.

Section 6. For purposes of, or in relation to expropriation, it is hereby declared that mining is not
for a public purpose.

Section 7. Mining agreements shall not be considered as vested rights, but, are mere privilege that
the State can grant or revoke anytime for a legitimate purpose.

CHAPTER II
SCOPE AND GENERAL PRINCIPLES

Section 8. Scope. This Act shall govern the ownership, management and governance of both
metallic and non-metallic ore minerals onshore and offshore, as well as quarry resources, sand and
gravel, guano, and gemstones, and the conservation, exploration, development, utilization,
processing and transportation thereof. The ownership, management and governance of petroleum,
natural gas and coal shall be governed by special laws. Offshore mining shall also be governed by
special laws.

This Act shall cover onshore and offshore, large-scale and small-scale mining operations in ‘the
country, including mining projects in ancestral domains in accordance to the existing national and
international policies on our indigenous peoples.

Section 9. Ore minerals form part of the country’s irreplaceable and non-renewable natural wealth
and capital. ‘The conservation of our mineral wealth is a paramount public interest and mineral
resources shall be utilized only in a rational manner for national and local development as specified
by law and the National Industrialization Program and the Mineral Management Plan. The economic
benefits derived from mining shall be equitably distributed by, among others, prioritizing
development for local communities and all other stakeholders directly affected by mining
operations

Section 10. The State shall have primary role, responsibility and concern in the management,
conservation, utilization, and development of the mining industry and shall ensure the peoples
participation in policy making and implementation of the same at all levels of government. ‘The
management of mineral resources shall be a shared concern and responsibility among the national
government, corporations, all levels of local government, and the communities affected by the
exploration, development, and utilization of mineral resources.

Section 11, The State shall accord support to communities dependent on small-scale mining whose
operations shall strictly adhere to the provisions of this law.

Section 12. Subject to their right to self-determination, indigenous cultural communities /indigenous
peoples (ICCs/IPs) own and have the responsibility to manage the mineral resources in their
tespective ancestral domains, free from external manipulation, interference, force threat,
intimidation, coercion and other analogous acts. ‘The State shall support indigenous cultural
communities in developing capacities to effectively exercise their right and responsibility. ’


Section 13, Mining shall be limited in scale in accordance with this Act.

Section 14. Mineral resources development, utilization and processing shall be reserved for Filipino
citizens and for Filipino corporations. Exploration shall be undertaken directly by the State for the
benefit of the nation.

Section 15, Remining and recycling of mineral resources shall be prioritized over the opening of
new mines to maximize and recover the remaining minerals resources from the rejects or wastes of
previous mines and mining operations.

Section 16. The State shall prioritize the rehabilitation of the abandoned mines in the country. The
State shall ensure the fullest compliance of all government and corporate entities in and\on the
closure of mines, the rehabiltation/restoration of the immediate environs or each’ mining
project/activity in the country as provided by law.

Section 17. The State shall encourage and support Filipino private corporations and mining
cooperatives to participate and invest in the mining industry on mutually-beneficial grounds that will
push forward the National Industrialization Program in both small-scale and large-scale projects.

Section 18. Mineral resource extraction shall be allowed based on the Philippine Government's
National Industrial Plan. The sharing of profits from mining activities, including the anticipated
environmental and social costs on the affected local communities of each mining project, should far
outweigh ecological and social benefits and costs from other land uses. The anticipated cost of
environmental and social impacts on the affected local communities, which shall at all times be
prevented and/or mitigated through the allocation of sufficient funds for this purpose. In mining
projects with foreign participation, a just return of investment scheme for the foreign entrants into
the industry shall be prescribed by law.

Section 19, ‘The State shall prioritize the development of mineral resources needed for national
development and the creation of domestic processing capacity for industrial metals, the integration
of agricultural modernization and other labor-intensive downstream industries. Mine planning shall
be conducted to meet this principle.

‘The National Industial Plan shall support national development based on the principles of
sustainable development and modernization of its economic base. This framework will define
minerals to be extracted, volume to be extracted and when to be extracted. ‘This shall be matched
with the approved mining areas as identified by the Councils. These matched areas are eligible for
mining operations.

CHAPTER Ii
DEFINITION OF TERMS

Section 20. Definition of terms. As used in and for the purposes of this Act, the following terms,
whether used in singular or in plural form, shall mean:


a.

Abandonment ~ the act of the contractor leaving a mine without rehabilitating the affected
areas or completing such rehabilitation despite the legal obligation to do the same;

‘Acid mine drainage — the dissolution, mobilization and transportation of toxic metals
from rocks resulting from the chemical reaction of the acid-generating minerals in rock and
waste materials having high permeability to both air and rainfall and other water inflows
when land is opened up for mining and initiates the chemical reaction, resulting to a
perpetual machine of acid generation;

Ancestral domains — all areas generally belonging to indigenous cultural
‘communities /indigenous peoples (ICCs/IP3) comprising lands, inland waters, coastal areas,
and natural resources therein, held under a claim of ownership, occupied or possessed by
ICCs/IPs, by themselves or through their ancestors, communally or individually since time
immemorial, continuously to the present except when interrupted by war, force majeure or
displacement by force, deceit, stealth or as a consequence of government projects or any
other voluntary dealings entered into by government and private individuals corporations,
and which are necessary to ensure their economic, social and cultural welfare.) It, shall
include ancestral lands, forests, pasture, residential, agricultural, and other lands individually
‘owned whether alienable and disposable or otherwise, hunting grounds, burial grounds,
areas of worship , bodies of water, mineral and other natural resources, and lands which
may no longer be exclusively occupied by ICCs/IPs but from which they traditionally and
historically had access to for their subsistence and traditional activities, particularly the home
ranges of ICCs/IPs who are still nomadic and/or shifting cultivators

Ancestral lands — lands occupied, possessed and utilized by individuals, families and clans
who are members of the ICCs/IPs by themselves or through their predecessors-in-interest,
under claims of individual or traditional group ownership, continuously, to the present
except when interrupted by war, force majeure or displacement by force, deceit, stealth, or
as a consequence of government development aggression projects and other voluntary
dealings entered into by government and private individuals /corporations including, but not
limited to, residential lots, rice terraces or paddies, private forests, swidden farms and tree
lots;

Beneficiation — a process wherein a large fraction of the waste material is removed from
the mineral ore;

Buffer Zones — identified areas outside the boundaries of and immediately adjacent to
designated protected areas designated by law that need special development control in order
to avoid or minimize harm to the protected area;

Bureau — the Mines and Geosciences Bureau (MGB) under the Department of
Environment and Natural Resources (DENR);

Carrying capacity — the capacity of natural and human environments to accommodate and
absorb change without experiencing conditions of ecological instability and attendant
degradation;


4

Certificate of Ancestral Domains Title (CADT) — title formally recognizing the rights of
possession and ownership of ICCs/IPs over their ancestral domains identified and
delineated in accordance with law;

Certificate of Ancestral Lands Title (CAL) ~ a title formally recognizing the rights of
IGCs/IPs over their ancestral lands;

Closure of mines — permanent cessation of operations at a mine or mine processing site
after completion of the decommissioning process;

Consensus ~ the decision communally reached after appropriate participatory consultation
and discussion, free from any external manipulation, interference and coercion, and other
analogous cases and obtained after fully disclosing the intent and scope, including the
positive and negative impacts of the activity, in a language and process understandable to
the community or group.

Consent — the free, prior and informed assent of the relevant person/s, ICCs/IPs, barangay
assemblies, landowner or occupant or possessor, given after fully disclosing the intent and
scope, including the positive and negative impacts of the activity, in a language and process
understandable to said persons or communities or assemblies;

Contract area — the area delineated as specifically provided by a mineral agreement for the
development or utilization of mineral resources found therein;

Critical watershed — refers to a drainage area of a river system, lake or water reservoir
supporting existing and proposed hydroelectric power, domestic water supply, geothermal
power and irrigation works, which needs immediate rehabilitation and protection to
minimize soil erosion, improve water yield and prevent possible flooding. The term shall
also include areas which are traditional human settlements, land-uses, or sea-uses which are
representative of a culture/cultures, or human interaction with the environment especially
when it has become vulnerable under the impact of irreversible change;

Critical habitats — place o environment where species or subspecies naturally occur or has
naturally established its population that are crucial to the survival of a species and essential
for its conservation;

Cultural sites — those that bear a unique or at least exceptional testimony to a cultural
tradition ot to a civilization which is living or which has disappeared or, directly or tangibly
associated with events or living traditions, with ideas, or with beliefs, with artistic and
literary works of outstanding universal significances

Customary laws — body of written and/or unwritten niles, usages, customs and practices
traditionally recognized, accepted and observed by respective ICCs/IPs and local
communities;

Decommissioning — the activity or process that begins after cessation of prospecting
activities or mineral production (including metallurgical plant production). It involves,
among others, the removal of unwanted infrastructure, making excavations and waste
repositories safe and stable and surface rehabilitation with a view to negate or minimize any


adverse environmental impacts remaining after cessation of mineral production. It includes
the after-care or maintenance that may be needed;

Downstream industries — are mining activities that cover minerals processing, refining,
manufacturing of intermediate and capital goods and marketing of such;

Ecological profile or eco-profile — geographic-based instruments for planners and
decision-makers which present an evaluation of the environmental quality and carrying
capacity of an area and measures the specific interactions that will be affected by any and all
mining operations;

Exploration — covers the methods of searching or prospecting for mineral resources by
non-invasive means for the purpose of determining the existence, extent, quantity and
quality thereof, which may include but not limited to seismic, gravity, magnetic,
clectromeganetic, radar, induced polarization, radio-wave and electrogeochemical
Extraction — ore-removal activities that take place at the mine site itself;

Free, prior and informed consent (FPIC) — the consensus of all members of the
ICCs/IPs to be determined in accordance with their respective customary laws and
practices, free from any external manipulation, interference, coercion, and other analogous
acts and obtained after fully disclosing the intent and scope, including the positive and
negative impacts, of all the activities, in a language and process understandable and
acceptable to the community;

Indigenous peoples/Indigenous cultural communities (IP /ICC) ~ refer to a group of
people or homogenous societies identified by self-ascription and ascription by others, who
have continuously lived as organized community on communally bounded and defined
territory, and who have, under claims of ownership since time immemorial, occupied,
possessed and utilized such territories, sharing common bonds of language, customs,
traditions and other distinctive cultural traits, or who have, through resistance to political,
social and cultural inroads of colonization, non-indigenous religions and cultures, became
historically differentiated from the majority of Filipinos. ICCs/IPs shall likewise include
peoples who are regarded as indigenous on account of their descent from the populations
which inhabited the country, at the time of conquest or colonization, or at the time of
inroads of non-indigenous religions and cultures, or the establishment of present state
boundaries, who retain some or all of their own social, economic, cultural and. political
institutions, but who may have been displaced from their traditional domains or who may
have resettled outside their ancestral domains. They are peoples who have a spiritual
relationship with the land;

Indigenous political structure — refers to organizational and cultural leadership systems,
institutions, relationships, patterns and processes for decision-making and participation,
identified by ICCs/IPs such as, but not limited to, Council of Elders, Council of Timuays,
Bodong Holders, and any other tribunal or body of similar nature;

Joint venture agreement — an agreement wherein the government and a qualified person
organize a joint-venture company, with both parties having equity shares, to develop and
manage mineral resources. Aside from earnings on the equity, the Government shall be


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entitled to a share in the output computed at a certain percentage mutually agreed upon by
and beneficial to both parties.

Key biodiversity areas — are sites of global biodiversity conservation significance. They are
defined by standardized criteria and thresholds to guide conservation interventions such as
the establishment of protected areas;

Large-scale mining — mining in areas with more than twenty (20) hectares, using
mechanized tools and equipment, requiring considerable capital and having large-scale
environmental, social, cultural and economic impacts with regard to resource use and/or
consumption;

Mineral agreement — a contract entered into by the government, in behalf of the State,
and a private Filipino person, granting such person/s the privilege to mine a specific
contract area;

Mineral resource — any concentration of minerals /rocks with potential economic value;

Mineral processing ~ the milling, beneficiation or upgrading of ores or minerals and rocks
or by similar means to convert the same into marketable products;

Minerals — all naturally occurring inorganic substance in solid, gas, liquid, or any
intermediate state excluding energy materials such as coal, petroleum, natural gas,
radioactive materials, and geothermal energy;

Mine development — preparing the mine site for production by shaft sinking ot pit
excavation building of access roads, and constructing of surface facilities;

Mine wastes and tailings —rock materials from surface or underground mining and milling
operations with little or no economic value to the generator of the same;

Mining activity — any or all of the following activities: exploration, extraction, utilization,
processing, transportation and other activities conducted for the same;

Mining area —a portion of the contract area which has been identified by the contractor
wherein actual mining operations are conducted;

Mining operations — cither all or any of the mining activities involving exploration,
feasibility, development, utilization, and processing

. National industrialization — in the mining industry, this shall denote the primacy of

mineral production, processing and distribution for the primary benefit of the domestic
economy. This includes creating favorable conditions for Filipino entrepreneurs to engage
in mining through various state-private agreements that shall ensure that mining shall help
spur more domestic investments, increase agricultural production and produce both
consumer and producer goods and manufactures;


an. National park — an area of the public domain essentially natural wilderness, scenic, or
historic in character which has been withdrawn from settlement, occupancy, or any form of
exploitation except in conformity with an approved management plan and set aside
exclusively to conserve the area or preserve the scenery, the natural and historic objects,
wild animals, and plants therein mainly for the purpose of biodiversity conservation and/or
human enjoyment; :

oo. Natural forest — forests composed of indigenous tees, not planted by man, whose
structure, functions, and dynamics have been largely the result of natural succession
processes;

pp. Natural parks ~ is a relatively large area not materially altered by human activity where
extractive resource uses are not allowed. These parks are maintained to protect outstanding,
natural and scenic areas of national or international significance for scientific, educational
and recreational use;

qq. Open-pit mining — Extracting metal ores and minerals that lie near the surface by
removing the overlying material and breaking and loading the ore. Also known as open-cast
mining and open-cut mining;

material that contains minerals in such quantities that it can be mined and worked
lly to extract that mineral. The mineral is usually contained in chemical
combination with some other clement in addition to various impurities;

Pollution control and infrastructure devices — infrastructure, machinery, equipment
and/or improvements used for impounding, treating, or neutralizing, precipitating, filtering,
conveying and cleansing mine industrial waste and tailings as well as eliminating or reducing,
hazardous effects of solid particles, chemicals, liquids or other harmful by-products and
gases emitted from any facility utilized in mining operations for their disposal;

Private land — any land belonging to any private person which includes alienable and
disposable land being claimed by a holder, claimant, or occupant who has already acquired a
vested right thereto under the law, although the corresponding certificate or evidence of title
or patent has not been actually is

uu. Processing — includes all treatment an ore receives after its extraction and beneficiation,
which involves changes in the chemical nature of the mined minerals;

vw. Progressive rehabilitation — rehabilitation which involves the staged treatment of
disturbed arcas during exploration, construction/development and mining operations;

ww. Protected areas — identified portions of land and water set aside by reason of their unique
physical and biological significance, managed to enhance biological diversity and protected
against destructive human exploitation;

xx, Protected landscapes, seascapes, marine sanctuaries — areas of national significance
which are characterized by the harmonious interaction of man and the environs ‘while
providing opportunities for public enjoyment through recreation and tourism within the
bounds of the normal lifestyle and economic activity of these areas;


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Quarry resources — any common rock or other mineral substances as the Director of the
Mines and Geosciences may declare to be quarry resources such as, but not limited to,
andesite, basalt, conglomerate, coral sand, diatomaceous earth, diorite, decorative stones,
gabbro, granite, limestone, marble, marl, red burning clay for potteries and bricks, rhyolite,
rock phosphate, sandstone, serpentine, shale, tuff, volcanic cinders, and volcanic glass,
Provided, That such quarry resources do not contain metals or metallic constituents and /or
other valuable minerals in economically workable quantities; Provided further, That, non-
metallic minerals such as kaolin, feldspar, bull quartz, quartz or silica, sand and pebbles,
bentonite, talc, asbestos, barite, gypsum, bauxite, magnesite, dolomite, mica, precious and
semi-precious stones, and other non-metallic minerals that may later be discovered and
which the Director declares the same to be of economically workable quantities, shall not be
classified under the category of quarry resources;

Quarrying — process of extracting, removing and disposing quarry resources found on or
undemeath the sueface of private or public land;

Regional Director — the regional director of any mines regional office;
Regional Office — any of the mines regional offices;

Recycling — shall refer to the treating of used or waste materials through a process of
making them suitable for beneficial use and for other purposes, and includes any process by
which solid waste materials are transformed into new products in such a manner that the
original products may lose their identity, and which may be used as raw materials for the
production of other goods or services: Provided, That the collection, segregation and re-use
of previously used packaging material shall be deemed recycling under the Act;

Rehabilitation — the process by which the land will be returned to a form and productivity
in conformity with a prior land use plan including a stable ecological state that does not
contribute substantially to environmental deterioration and is consistent with surrounding
aesthetic values;

Remediation — removal of pollution or contaminants from environmental media for the
general protection of the area and the peoples

Remining — maximizing and recovering the remaining minerals from the rejects or wastes
of previous mines and mining operations;

Restoration — where the intent is to recreate an ecosystem as close as possible to the
original which existed at the site, with most of the structure and productivity matching that
of the otiginal ecosystem, and most of the original biodiversity: in time ecological processes
and functions will match those of the original forest;

Selfdetermination - refers to the right of a people to determine its own political destiny as
defined by existing Philippine laws. The right to self-determination has includes the right of
ICCs/IPs to choose their form of goverment within existing national borders to achieve a
greater degree of autonomy to help preserve their culture, ancestral domain, and way of life;


ii, Small-scale mining — mining activities which rely heavily on manual labor using simple
implements and methods and do not use explosives or any heavy mining equipment,
primarily engaged in for sustainable living. Impacts from small-scale mining shall not be
large-scale, otherwise, the mining activity shall be defined as large-scale mining;

ij. Small-scale mining permit — permit issued for small-scale mining;

kkk. Strategic minerals — minerals needed for national industrialization, including rural
development;

li Tailings Disposal System or Tailings Placement — the method wherein the waste from
mining operations are dumped, placed, or disposed;

mmm. Traditional small-scale mining — small-scale mining using traditional means and
without the use of chemical or mechanized extraction and separation means, methods,
implements, and/or equipment,

ana, Watershed continuum — shall refer to an area consisting of the watershed and its divide
including its connection from the headwaters to the reef or a land area drained by a Stream
or a fixed body of water and with tributaries having a common outlet for surface runoff. It
is the system by which the mining-affected communities shall be determined following the
drainage of a stream or fixed body of water with tributaries having a common outlet for
surface runoff;

000. Wildlife — undomesticated forms and varieties of flora and fauna;

CHAPTER IV
OWNERSHIP AND GOVERNANCE,

Section 21. Authority of the Bureau. The Mines and Geosciences Bureau shall be a scientific
research institution under the Department of Environment and Natural Resources (DENR)
primarily conducting and developing research of mineral resources and mining technologies and
training of local communities, local government units and indigenous peoples. It shall also regulate
the operations of persons involved in mining activities. It shall also work with the Multi-Sectoral
Mineral Council in the monitoring of mining activities.

Section 22. Regional offices. The Burcau shall have as many regional offices in the country as may
be established by the Secretary, upon the recommendation of the Director.

Section 23, Bureau as repository of information. The Bureau shall be the central repository of
information regarding mineral lands, resources, permits, studies and other information relevant to
the operation of a mine, including the necessary requirements which a contractor is obliged to
submit. All other governmental offices and other bodies created under this Act shall copy furnish
the Bureau of all other information related to mining.

Section 24. Recording system. There shall be established a national and regional filing and
recording system. A mineral resource database system shall be set up in the Bureau which shall
include, among others, a mineral rights management system.


Section 25. Publication. The Bureau shall publish at least annually a mineral gazette of nationwide
circulation containing among others, a current list of mineral rights, their locations specified in the
appropriate map, mining rules and regulations, other official acts affecting mining, and other
information relevant to mineral resources development. A system of publication fund shall be
included in the regular budget of the Bureau.

Section 26. Bureau to conduct exploration activities. Exploration of mineral resources shall be
exclusively and directly undertaken by the State through the Bureau. In no case shall this function
be delegated or contracted out to private corporations or persons.

Section 27. Non-invasive exploration. Exploration activities shall only be non-invasive such as
seismic, gravity, magnetic, electromagnetic, radar, induced polarization, radio-wave and electro-

geochemical.

Section 28. Consent. The Bureau shall not conduct any exploration activity without the free, prior
and informed written consent of relevant land owner, possessor and/or occupant; the affected
communities; and/or of the ICC/IP. Neither shall the Bureau enter into any part of the ancestral
domains lands of ICCs/TPs without their free and prior informed consent. Further, the Bureau shall
not enter into any distributed land under the Comprehensive Agrarian Reform Program within the
10 years prohibited period of the said program.

Section 29. Ownership of ICCs/IPs. The mineral resources within ancestral domains/ahcestral
lands are the collective private property of the indigenous cultural communities/indigenous peoples
(ICCs/1P3) as provided by law. The management of such mineral resources shall build on the
indigenous knowledge systems and practices of the ICCs/IPs.

Section 30. Free, prior and informed consent. No mining activity shall be conducted within the
ancestral domains/lands of ICCs/IPs without their free, prior and informed consent (FPIC), in
addition to the conditions set forth under the succeeding sections of this Act.

Section 31. When ancestral domain is not formally recognized. When ancestral domain is not
covered by a Certificate of Ancestral Domain Title/Certificate of Ancestral Land Title
(CADT/CALT), or is covered by a different title issued in favor of members of the ICCs/IPs,
mineral resources shall nevertheless be managed by the ICCs/IPs concerned when it can be
presumed that the area is part of ancestral domain. An area is presumed to be part of ancestral
domain by virtue of historic rights and self-<delineation by the ICCs/IPs.

Section 32. When ICCs/IPs displaced from ancestral domain, and when ancestral domain is
already covered by other titles emanating from the State other than CADT/CALT. 1P/ICC
rights over ancestral domain subsists notwithstanding the fact that the ICCs/IPs who hold such
rights have been displaced therefrom or that such ancestral domains have been occupied by other
persons or corporations under another claim of title emanating from the State. In such cases,
ICCs/IPs shall continue to own such mineral resources.

Section 33. Questions on the validity of FPIC. In instances that there are questions on the
legality or validity of the issued free prior and informed consent, mining operations shall not be


allowed to be conducted in the ancestral domains or lands of the ICCs/IPs without the final
resolution of such question on the legality or validity of the FPIC.

Section 34. Ownership of the State. The mineral resources found outside ancestral
domains/lands shall be owned by the State. The State shall ensure that the management of mineral
resources shall be primarily for the benefit of the local communities in whose territory the same shall
be found. Any minerals extracted shall be solely used for local industries consistent with the
Minerals Management Plan. ‘The State may directly undertake development, utilization and
processing of mineral resources or it may enter into mineral agreements with eligible parties
pursuant fo the provisions of this Act.

Section 35. Inventory of mineral resources. ‘The Bureau shall identify and provide an inventory of
the available mineral resources, including the mine tailings and wastes within the country. It shall
submit to the DENR a report which shall contain the following information:

2) the classification of minerals;
b) the quality and grade of the ore;

©) the potential mine life;

the geological description of the area;

6) the economic viability of mine tailings;

§) whether the area is a key biodiversity area or if itis a critical habitat;

) and all other relevant information necessary for potential mineral investments.

‘The process for mineral exploration and/or approval for a mining permit shall not commence
without the said inventory.

Section 36. Identification of strategic minerals. ‘The Bureau shall conduct researches and studies
prior to any mining operations to identify strategic mineral resources. Only mineral resources that
shall be needed for local industries, agricultural modernization and rural development shall be
opened to mining subject to the implementing rules and regulations of this Act.

Section 37. Demarcation of mineral areas. ‘The Bureau shall demarcate the boundaries of all areas
identified as containing commercial quantities of mineral resources on the ground.

Section 38, Baseline information on watershed continuums. ‘The baseline information on all
watersheds in the country shall be required and made available to the public, online as much as
possible. No mining permit shall be issued without this baseline information.

Section 39. Affected local community and local government unit. For the purposes of this Act,
the affected local community and the affected local government unit are defined in relation to the
watershed continuum which is potentially negatively impacted by mining operation in the
demarcated area. The local communities and the local government units therefore are those who are
dependent on the watershed eco-system and its resources.

Section 40. Establishment of Multi-Sectoral Mineral Councils. A Multi-Sectoral Mineral
Council shall be established for the purposes of this Act. There shall be as many Multi-Sectoral
Mineral Councils are there are watershed continuums with demarcated mineral areas.


Section 41. Powers of the Council. The Council shall have the following powers, among others:

2) To determine whether or not mining operations shall be allowed;
b) To deliberate on proposals for mineral agreements;

©) To approve the proposal for mineral agreements;

To monitor the conduct of mining operations;

©) To establish its internal rules of procedure which are not contradictory to this Act;

Section 42. Composition of the Multi-Sectoral Mineral Council. The Multi-Sectoral Mineral
Council shall be composed of representatives from the Bureau, one representative from each of the
affected provincial governments/independent component cities/highly urbanized cities,
representatives from peoples /community/sectoral/non-governmental organizations as many as the
representatives of local government units, and the affected ICCs/IPs within the watershed
continuum. The Bureau shall be the convenor of the Council.

No mining operations shall be allowed without the Council having been properly convened,

Section 43. Areas open to mining. The Council shall have the power to determine whether or not
the land where mineral resources are found shall be opened to mining. Areas may only be opened to
mining upon the vote of two-thirds of all the members of the Council pursuant to the guidelines
provided by this Act. In determining whether or not such area shall be opened, the following shall
be required:

Report of the Bureau on the conducted exploration;

Existence of downstream industries for the mineral resources;

Potential environmental impacts;

Potential cultural impacts;

Conflict and risk assessment;

Potential health impacts;

Potential economic benefits of the development and utilization of the minerals;
Carcying capacity and the ecological profile of the area;

Existing and alternative land uses of the area; 5
Local government land use plan.

Eeces

No mining application shall be allowed unless an environmental economic audit or resource
valuation of the proposed mining area has been conducted or prepared applying acteptable
valuation standards. This audit or resource valuation shall be conducted in coordination’ with
multisectoral group of experts and community stakeholders. It shall include determination of the
expected economic returns and the potential negative impacts ftom mining on the enjoyment and
exercise of human rights, cultural rights, and on peace and security. A detailed study must mention
the flora, fauna and environment present in the mining claim and the impact of mining operations
on the environment, the possible environmental degradation and the attendant loss of subsistence
resources cause. There must be mention of existence of sacred areas or areas otherwise of cultural
significance and address the impacts of resource exploitation on indigenous peoples and local
communities.

‘This information shall be accessible to the public at all times. Provided That in no case shall the
Council open the following areas to mining:


a) Areas declared by Local Government Units as No-Mining Zones as specified ,by local
ordinances, and other issuances;

b) Densely populated areas, especially residential areas;

c) Head waters of watershed areas;

d) Areas with potential for acid mine drainage;

©) Critical watersheds;

) Critical habitats;

Climate disaster-prone areas;

h) Geohazard areas;

3) Small island ecosystems;

i) Culeural sites, which may include, but not limited to, sacred sites and burial grounds;

1) ‘Traditional swidden farms and hunting grounds;

1) Lands covered by the Comprehensive Agrarian Reform Law or Republic Act No. 6657, as
amende

m) Prime agricultural lands, irrigable and irrigated lands as defined by Republic Act No. 9700;

1) Cultural property enumerated under the National Cultural Heritage Act of 2009 or Republic
act No. 10066;

0) Community sites;

p) Key biodiversity areas;

) High conflict areas;

8) The Province of Palawan pursuant to Republic Act No. 7611 and other areas covered by
local ordinances;

8) In military and other government reservations, except upon prior written clearance by the
government agency /agencies concerned;

*) Near or under public or private buildings, cemeteries, archaeological and historic sites,
bridges, highways, waterways, railroads, reservoirs, dams or other infrastructure projects,
public oF private works including plantations or valuable crops, except upon written consent
of the government agency agencies or private entity concemed;

)_ Inareas expressly prohibited by law or ordinances;

¥) In areas covered by small-scale miners as defined by law unless with ptior consent of the
small-scale miners, in which case a royalty payment upon the utilization of minerals shall be
agreed upon by the parties, said royalty forming a trust fund for the socioeconomic
development of the community concerned; and

w) Old growth, natural or primary and secondary forests, watershed forest reserves, wilderness
areas, mangrove forests, mossy forests, national parks, protection forests,
provincial/municipal forests, parks, greenbelts, game refuges and bird sanctuaries and theit
respective buffer zones prohibited under the National Integrated Protected Area, System
(NIPAS) under Republic Act No. 7586, Department Administrative Order No. 25, series of
1992 and other laws and ordinances and those expressly prohibited by other laws.

‘The determination whether or not the same are absolutely closed to mining shall not only be limited
to the existence of a law or ordinance declaring it as protected areas, but also to the actual tise of
said area

Section 44. Process of determination for opening an area to mining. After the submission of
the exploration report and the resource valuation report, the Bureau shall convene the Council. The


Council shall thereafter convene their respective constituents to determine whether or not their
respective territories shall be opened for mining.

Sections 26 and 27 of the Local Government Code on consultation and consent shall be strictly
adhered to. Local government units at all levels shall conduct mandatory public hearings with the
affected local communities, to be catried out within their respective territories and presenting those
‘enumerated under Section 41.

‘The decision of the respective Sanggunians of all the local government units in. the watershed
continuum shall be made in accordance to the sentiment of the peoples of the local government unit
as a result of the consultations conducted.

Provided, ‘That each Sangguniang Barangay within the watershed continuum shall convene theic
respective barangay assemblies for the purpose of this section. Local government units shall ensure
that the Bureau shall comprehensively explain the goals and objectives of the project or program, its
negative and positive impact upon the people and the community in terms of environmental or
ecological balance, and the measures that will be undertaken to prevent or minimize the adverse
effects thereof. The free prior and informed consent of all barangay assemblies within the watershed
continuum shall be a condition precedent for any mining activity.

Provided futher, ‘That no mining, activity shall be approved by the council without the free and prior
informed consent of all indigenous peoples within the watershed continuum.

For the purposes of declaring that an area is open for mining, the Council shall ensure that all the
requisites under Section 41 and 42 have been complied with.

Provided finaly, ‘That any member of the community may file a protest with the Council during, the
period of consultations and deliberations for the Council's consideration.

Section 45. Violation of Section 54. Local government officials who are administratively found to
violate the preceding section and Section 54 of this Act vis-i-vis the pertinent sections of the Local
Government Code shall be removed from office and perpetually disqualified from holding any
elective or appointive position in government, its divisions, subsidiaries and any government owned
and controlled corporations.

Section 46. Pool of consultants. There shall be a pool of independent consultants that may assist
the local government units, local communities or ICCs/IPs with regard to the technical aspects of
mining,

Section 47. Publication, posting and radio announcement requirements. ‘The decision of the
Council shall be published by the Bureau in the local newspaper in the local language, shall be
announced on the local radio programs for not less than six (6) weeks and notices shall be
distributed widely in communities. The notice containing relevant information shall likewise be
posted in conspicuous places for the information of the general public and shall be announced
during the local market day.

CHAPTER V
MINERAL AGREEMENTS :


Section 48. Modes of mineral agreement. A mineral agreement may only take the following.
forms as herein defined:

2) Mineral production sharing agreement — is an agreement where the Government grants
to the contractor the exclusive right to conduct mining operations within a contract area and
shares in the gross output. ‘The contractor shall provide the financing, technology,
‘management and personnel necessary for the implementation of this agreement,

b) Co-production agreement — is an agreement between the Government and the contractor
wherein the Government shall provide inputs t0 the mining operations other than the
mineral resource; and

©) Joint venture agreement — is an agreement where a joint-venture company is organized by
the Government and the contractor with both parties having equity shares. Aside from
earnings in equity, the State shall be entitled to a share in the gross output. t

In no case shall Financial or Technical Assistance Agreements, or any other similar agreements,
contracts, and/or executive issuances granting license or permission to explore, develop and/or
utilize mineral resources be awarded to foreign entities or persons.

Section 49. Eligibility. Only Filipino citizens or corporations sixty percent (60%) of whose equity
is owned or controlled by such citizens shall be allowed to conduct development, utilization and
processing of mineral resources within the country.

Section 50. Identification of mining projects. With the vote of two-thirds of all the members of
the Council, to open areas for mining operations, the Bureau shall prepare the necessary information
sheets on the said area for potential investments. ‘The Bureau shall call for proposals to develop the
mining area based on the Mineral Management Plan

Section 51. Pre-screening of mining proposals. Mining proposals shall be pre-screened by the
Bureau according to the National Industrialization Program and Mineral Management Plan upon the
submission of interested parties of the following:

2) demonstration of financial capability;
b) proven social and environmental track record, including those of its officers and directors;
©) clear corporate structure and ownership;

4) proof of physical office and operations of the proponent within the Philippines;

©) identification of potential investors;

8) mining project feasibility;

g) mining operation work plan;

) proposed operation, mitigation and prevention methods and/or equipment;

4) capacity to process minerals;

intent to develop downstream industries;

}) intent to contribute to local community development; and

}) Submission of the Environmental and Social Impact Assessment and Mitigation Plan


The Council shall fix the minimum capitalization that any bidder must satisfy based on its
determination of the expected economic returns and the potential negative impacts from mining,
upon reference to an independent study proposing such minimum capitalization.

Section 52. Environmental and Social Impact Assessment and Mitigation Plan. The
conteactor shall submit an Environmental and Social Impact Assessment and Mitigation Plan
(ESIAMP) containing the means, methods, processes and schedule by which the contractor shall
conduct its operations and mitigate negative environmental and social impacts. Social impact shall
include possible impacts on the enjoyment and exercise of human rights, cultural rights, The
ESIAMP shall include plans relative to mining operations; the rehabilitation, regeneration and
restoration of mineral areas; slope stabilization of mined out and tailings covered arcas; aquaculture,
watershed development and water conservation; the relocation and retum of displaced population;
and provisions for alternative livelihood and socioeconomic development.

The ESLAMP shall also contain a Social Development Plan which shall likewise contain the plans of
the proponent for the development of the community through the establishment of infrastructures
and programs that shall be sustainable even after the closure of the mine.

Section 53. Pre-qualification. The Bureau shall thereafter identify the top three (3) proposals and
shall recommend the same to the Council for deliberation. i

Section 54. Deliberation of the proposals. Pre-conditions provided in Section 45 on the free,
prior and informed consent of persons, landowners, possessors or occupants, communities or
barangay assemblies, IPs/ICCs, and/or local Sanggunians shall likewise be requited under this
Section.

Section 55. Posting and publication requirement. After notice, the Bureau shall notify the
proponent of the accepted proposal and cause the publication and posting of the accepted proposal.
Provided, That any member of the community may contest the decision of the Council within six (6)
weeks upon the posting and publication of notice of the acceptance of the proposal in the manner
provided in Section 44. No mining operations shall be allowed to be conducted pending any action
questioning the legality or validity of the proposal.

Section 56. Issuance of the permit. After six (6) weeks from the date of the posting and
publication, if no contest is filed, the Bureau shall issue a permit in accordance with the decision of
the Council on the winning proposal.

Section 57. Environmental and Social Impact Compliance Certificate. The mining proponent
shall be issued an Environmental and Social Impact Compliance Certificate by the Bureau with the
approval of the Council.

Provided, That no amendments to the conditions of the Certificate shall be allowed, unless such
proposed amendment shall work for the benefit of the communities, and in which case, the Council
and the Bureau shall be notified of any amendments to the ESLAMP and that the former should
give their consent to the same, after the proponent explaining in detail the reason for such
amendment and the possible impacts and consequences of these amendments.

Provided further, ‘That any violation of the ESLAMP shall cause the cancellation of the Certificate.


Section 58. Maximum areas for mineral agreements. ‘The maximum area under mineral
agreements that a person can hold at any one time shall be determined by the Council. Provided, ‘That
the contract area per agreement shall not exceed five hundred (500) hectares;

Provided further, That no person shall be awarded in excess of the total contract area of seven
hundred-fifty (750) hectares in any given watershed area. For the purposes of this Act, the
prohibition on the maximum area shall also include corporations that shall have common directors
or significant shareholders.

Section 59. Term of mineral agreement. ‘The term of the mineral agreement shall be equivalent to
the mine life plus an additional five (5) years for the rchabilitation of the mining area. Provided, That
in no case shall a Mineral Agreement have a term beyond fifteen (15) years. Provided further, That the
contractor shall already include rehabilitation /remediation of the mining area within the ten-year
term.

In no case shall a Mineral Agreement be extended without just cause to be determined by the
Council, Provided, That the extension shall not cause the term of the agreement to exceed the fifteen
(15) year term mentioned in the preceding section. Provided further, That for the purposes of this Act,
just cause shall mean acts or events resulting from war, force majeure or those beyond the control of
the mining proponent not attributable to the same.

Provided finally, That in no case shall mineral agreements be renewed after the expiration |of the
fifteen-year period.

Section 60. Prohibition on open-pit mining method and submarine tailings disposal. Open-
pit mining method for the extraction of mineral ores and the submarine tailings disposal'method
shall be prohibited. i

Section 61. Failure to initiate mining operations. Failure to commence the development stage of
the mining operations in accordance with the work program within two (2) years from the award of
the mineral agreement shall cause the cancellation of the mineral agreement. The contractor
thereafter forfeits the value of the improvements made upon the land. The contractor and other
corporations who are also run by the same directors and officers are thereafter banned from bidding
to conduct mining operations for ten (10) years after failure to commence the development stage of
the mining operations in accordance with the work program.

Section 62. Mandatory consultations in each mining phase. Mandatory consultations with
affected persons and communities shall be undertaken in cach phase of mining operation:
exploration, extraction, processing, and mine closure to ensure that the peoples shall be informed of
the proposed plans and methods that are proposed to be conducted.

Section 63. FPIC on each stage of mining operation. The free and prior informed consent of
the ICCs/IPs, the barangay assemblies, and private landowners, possessors, occupants shall be
required at each and every stage of the mining operations.

‘As to ICCs/IPs, their free and prior informed consent shall be secured in accordance with their
Jaws, practices and processes. Violation of any of the conditions imposed by the ICCs/TPs on the


contractot shall cause the cancellation of the mineral agreement. Included in this process is the
explanation of the rights of ICCs/IPs of ownership and self-determination.

Section 64. Multi-partite monitoring. The Council shall form a multi-partite monitoring team to
monitor compliance by the contractor of the terms and conditions of the mineral agreement. It may
conduct ocular inspections of the contract area at any time of the day and night. It shall also inspect
all the books of contractors and refer the same to independent auditors. The Multi-partite
monitoring team and/or the Bureau may confiscate surety, performance and guaranty bonds posted
through an order to be promulgated by the Director. The Council, the Director or the local
government authorities may deputize, when necessary, any member or unit of the Philippine
National Police, barangay, duly registered nongovernment organization (NGO) or any qualified
person to police any and all mining activities.

Section 65, Withdrawal from the mineral agreement. The contractor may withdraw from the
mineral agreement at any time for justifiable cause with one (1) month’s notice to the Bureau, the
Council and/or the ICCs/IPs, and other government agencies as may be provided by law. The
Council, in cooperation with other concerned government agencies, shall issue a clearance for
withdrawal upon certifying that the contractor has complied with all its legal obligations, including
the appropriate measures for mine closure and rehabilitation. Funds and bonds which have been
put up by the contractor in accordance with this Act shall be forfeited.

Section 66, Non-transferability of mineral agreements. In no case shall mining rights under this
Act be transferrable. The contractor shall also immediately notify the Council and the Bureau of any
substantial change in the ownership and/or control of the corporation. Violation of this provision
shall cause the cancellation of the agreement and forfeiture of assets and equipment of the
contractor in favor of the State.

Section 67. Access to information. All contractors for mineral permits and agreements shall
provide information to affected indigenous peoples, local communities, and local governments. The
following information, among others, shall be required:

2) fall disclosure of methods and processes of mining F
b) fall disclosure of environmental and social risks {

©) fill disclosure of ownership structure :
d) full disclosure of financial sources

All information and documents related to proposals, mineral agreements, permits and mining,
operations shall not be considered confidential. Refusal to grant access to this information shall be
cause for the disqualification of prospective proponents or cancellation of mineral agreements and
permits.

‘The Bureau, being the repository of all relevant information under this Act is mandated to grant
access to the public of any information in its custody. Refusal or unnecessary delay by the officers of
the Bureau to give information shall be punishable by a fine of fifty thousand pesos (PhP 50,000.00)
for every instance of refusal or unnecessary delay. Information requested by indigents or
marginalized sectors shall be given to them for free.


CHAPTER VI
SMALL-SCALE MINING

Section 68. Applicability of RA 7076. Small-scale mining shall continue to be governed by the
provisions of Republic Act No. 7076 or the People’s Small-Scale Mining Act of 1991, Provided, That
the Provincial /City Mining Regulatory Board shall be composed of the Governor or City Mayor, as
chairperson, as the case may be, a representative from the DENR as co-chairperson, one (1) small-
scale mining representative, one (1) large-scale mining representative, one representative from a
nongovernment organization who shall come from an environmental group, one representative
from a people’s organization (PO) coming from the marginalized sector, and at least one (1)
representative from the indigenous communities, whenever applicable, as members. The
representatives from the private sector, non-government organization and indigenous communities
shall be selected by their respective organizations and/or communities, and appointed by the PMRB
‘ot CMRB: Provided further, That the conduct of small-scale mining shall also comply with the
prohibitions and regulations established herein for large-scale mining. Only qualified individuals and
cooperatives may apply for a small-scale mining permit.

Section 69. Maximum term of small-scale mining permits. ‘The term for small-scale mining
permits shall be three (3) years, extendable to a maximum of fifteen (15) years.

Section 70. Traditional small-scale mining within ancestral domains. The Council shall
conduct regular monitoring activities within its jurisdiction to determine if the provisions of relevant
laws are complied with in traditional small-scale mining by ICCs/IPs within their respective
ancestral domains.

Section 71. FPIC in small-scale mining. Small-scale mining activities within any ancestral domain
by any person shall also require the free, prior informed consent of ICCs/IPs.

Section 72. Requirement for an Environmental and Social Impact Compliance Certificate.
Small-scale mining shall likewise require an Environmental and Social Impact Compliance
Certificate. All small-scale mining applicants or proponents must show proof of compliance with the
terms and conditions of its Environmental and Social Impact Compliance Certificate (ESIC) prior
to the issuance of a small scale mining permit. Failure to submit this requirement will result in the
non-issuance of the small-scale mining permit (SSMP).

Section 73. Environmental measures in small-scale mining. ‘The State shall immediately address
the environmental and health hazards and problems in small-scale mining, including, the use of
hazardous chemicals, such as mercury, cyanide and other chemicals, in the amalgamation of gold by
small-scale miners, i

Section 74. Prohibition on the use of mercury. Mercury use in small-scale mining shall be
prohibited. The Bureau shall research, develop and actively promote appropriate technologies in
small-scale mining including labor-intensive methods, environmental protection and physical
techniques of gold extraction among small-scale miners.

Section 75. Multisectoral monitoring team. A multisectoral monitoring team shall be organized
to monitor the SSMP permittee’s compliance with the terms and conditions of its SSMP and ECC.


‘The MMT shall conduct ocular inspections of the SSMP area at any time of the day and night and
shall have visitorial powers.

Section 76, Alternative livelihood support. The state shall support the improvement of the
livelihood of small-scale-miners by extending the services for access to other more viable and
sustainable forms of livelihood, and, if the same is not possible, the following support services:

4) access to minerals markets and to financing;

b) facilitating partnership with mining companies or contractors by, among others, requiring
mining companies to buy tailings from small-scale mining operations for further processing
of recycling;

facilitating partnership among small-scale mining cooperatives; and

)_ other incentives to attract informal small-scale miners to formalize their status.

Section 77. Buying stations. The Bangko Sentral ng Pilipinas shall ensure that buying stations
acquire gold from small-scale traders at prevailing international gold market prices and the prevailing
exchange rate set by the BSP Treasury Department on a daily basis.

CHAPTER VIL
QUARRY RESOURCES

Section 78. Quarry resources within ancestral domains. Gathering of quarry resources, sand and
gravel, guano and other organic fertilizer materials, and gemstones within ancestral domains shall
likewise be subject to the free prior informed consent of ICCs/IPs. ICCs/IPs and the government
shall be entitled to at least ten per cent (10%) of royalties depending on whether the resources are
found inside or outside ancestral domains. Permits shall be limited to a maximum term of five (5)
years, renewable for like periods but not exceeding a total term of twenty five (25) years, and a
maximum area of five (5) hectares.

Section 79. Quarry Permit. Any qualified Filipino may apply for a quarry permit on privately-
owned lands except ancestral domains and/or public lands for building and construction materials
such as marble, basalt, andesite, conglomerate, tuff, adobe, granite, gabbro, serpentine, inset filling
materials, clay for ceramic tiles and building bricks, pumice, perlite and other similar materials that
are extracted by quarrying from the ground at the provincial/city mining regulatory board. ‘The
provincial governor shall grant the permit after the applicant has complied with all the requirements
as prescribed by the rules and regulations set forth by this Act. Provided, That gathering/extraction of
sand for its metallic contents such as magnetite from the country’s rivers and shorelines shall be
require a mineral agreement in lieu of a quarry permit.

‘The maximum area which a qualified person may hold at any one time shall be limited to a surface
area of five hectares (5 has.): Provided, That in large-scale quarry operations involving cement raw
materials, marble, granite, sand and gravel and construction aggregates, a qualified person and the
government may enter into a mineral agreement as defined herein. ‘

A quarry permit shall have a term of five (5) years, renewable for like periods but not: to exceed a
total term of twenty-five (25) years. No quarry permit shall be issued or granted on any area covered
by a mineral agreement.


Section 80. Quarry Fee and Taxes. A permittee shall pay a quarry fee as provided for under the
implementing rules and regulations. The permittee shall also pay the excise tax as provided by
pertinent laws.

Section 81. Cancellation of Quarry Permit. A quarry permit may be cancelled by the provincial
governor for violations of the provisions of this Act or its implementing rules and regulations or the
terms and conditions of said permit: Prosided, That before the cancellation of such permit, the holder
thereof shall be given the opportunity to be heard in an investigation conducted for the purpose.

Section 82. Commercial Sand and Gravel Permit. Any qualified person may be granted 4 permit
by the provincial governor to extract and remove sand and gravel or other loose or unconsolidated
materials outside ancestral domains which are used in their natural state, without undergoing
processing from an area of not more than five hectares (5 has.) and in such quantities as may be
specified in the permit.

Section 83. Industrial Sand and Gravel Permit. Any qualified person may be granted an industrial
sand and gravel permit by the Bureau for the extraction of sand and gravel and other loose or
unconsolidated materials outside ancestral domains that necessitate the use of mechanical processing,
covering an area of not more than five hectares (5 has.) at any one time. The permit shall have a
term of five (5) years, renewable for a like period but not to exceed a total term of twenty-five (25)
years.

Section 84, Exclusive Sand and Gravel Permit. Any qualified person may be granted an exclusive
sand and gravel permit by the provincial governor to quarry and utilize sand and gravel or other
loose or unconsolidated materials from public lands for his own use, Provided, ‘That there will be no
commercial disposition thereof.

Section 85. Government Gratuitous Permit. Any goverment entity ot instrumentality may be
granted a gratuitous permit by the provincial governor to extract sand and gravel, quarry ot loose
unconsolidated materials outside ancestral domains needed in the construction of building and/or
frastructure for public use or other purposes over an arca of not more than two hectares (2 has.)
for a period coterminous with said construction.

Section 86. Private Gratuitous Permit. Any owner of land may be granted a private gratuitous
permit by the provincial governor to extract sand and gravel, quarry or loose unconsolidated
materials within his property.

Section 87. Guano Permit. Any qualified person may be granted a guano permit by the provincial
governor to extract and utilize loose unconsolidated guano and other organic fertilizer materials in
any portion of a municipality where he/she has an established domicile outside ancestral domains.
‘The permit shall be for specific caves and/or for confined sites with locations verified by the
Department's field officer in accordance with existing rules and regulations. Provided, That extraction.
does not violate and is consistent with the provisions in the Cave Conservation Act and the Wildlife
Act.


Section 88. Gemstone Gathering Permit. Any qualified Filipino may be granted a non-exclusive
gemstone gathering permit by the provincial governor to gather loose stones useful as gemstones in
rivers and other locations outside ancestral domains.

Section 89. Council recommendation for approval. All permits under Chapter VII of this Act
shall require the recommendation of the Multi-Sectoral Mineral Council prior to approval by the
provincial government unit. The absence of a recommendation from the Council prohibits the
approval of any permit in this Chapter.

CHAPTER VIII
TRANSPORT, SALE AND PROCESSING OF MINERALS

Section 90. Ore transport permit. A permit specifying the origin and quantity of non-processed
mineral ores or minerals shall be required for their transport. Transport permits shall be issued by
the Bureau. The absence of a permit shall be considered as prima facie evidence of illegal mining
and shall be sufficient cause for the confiscation of the ores or minerals being transported, the tools
and equipment utilized, and the vehicle containing the same.

Section 91. Mineral trading registration. No person shall engage in the trading of mineral
products, either locally or internationally, unless registered with the Department of ‘Trade and
Industry and accredited by the Department, with a copy of said registration submitted to the Bureau.

Section 92, Track record. Only mining companies with demonstrated capacity and good
environmental track record in mineral processing shall be given mineral processing permit. ‘The
Council shall encourage contractors to put up processing plants within the community with the end
in view of generating employment and developing other downstream industries.

Section 93. Mineral processing permit. No individual, partnership, partnership, cooperative,
corporation or other entity shall engage in the Secretary of the Department. Of Environment and
Natural Resources (DENR).

In the case of small-scale miners, the processing of mineral ores they produce, as well as the
licensing of their custom mills or processing plants, shall continue to be governed by the provisions
‘of Republic Act No. 7076.

In the case of individuals, corporations, partnerships, cooperatives or other entities who ate parties
toa Mineral Agreement or a Financial or Technical Assistance Agreement, holders of quarty and
industrial sand and gravel permits, the approved work program for the production period shall be
sufficient requirement for them to process minerals in lieu of a mineral processing permit.

‘A mineral processing permit shall be for a period of ten (10) years, renewable for like periods:
Provided, ‘That renewal shall not be allowed unless the permit holder has complied with all the terms
and conditions of the permit and has not been found guilty of violation of any provision of this Act
and its implementing rules and regulations.

After due process, a mineral processing permit may be suspended, revoked or cancelled by the
DENR for violation of its terms and conditions, or of pertinent laws, rules and regulations.


Mineral processing shall be included in the Investment Priority plan to be prepared by the Board of
Investment in accordance with Executive Order No. 226, as amended, otherwise known as the
Omnibus Investment Code of 1987 and shall always be listed as a preferred area of investment.

CHAPTER IX,
DEVELOPMENT OF COMMUNITIES, SCIENCE AND TECHNOLOGY

Section 94. Expenditure for community development. A contractor shall assist in the
development of the community, and the promotion of the general welfare of its inhabitants towards
sustainable development. Community development projects shall in no way decrease the obligation
of the corporation with regard to royalties and fees due to communities or local government units.
Community development projects should be consistent with the Comprehensive Land Use Plans
(CLUP), Ancestral Domains Sustainable Development and Protection Plan (ADSDPP) and annual
investment plans of the local governments, CADT/CALT holders and the like.

Section 95. Employment of Filipinos and training of members of the local community. A
contractor and/or permittee shall give preference to Filipino citizens in all types of mining
employment within the country. Members of the local community shall be trained in all aspects of
the mining operations, including remining, recycling, rehabilitation, and the management thereof.

Section 96. Use of indigenous goods, services and technologies. A contractor shall give
preference to the use of local goods, services, and the scientific and technical resources in all stages
‘of mining operations, where the same are of equivalent quality and are available on equivalent terms
as thei imported counterparts.

Section 97. Donation/turnover of facilities. Prior to the cessation of mining operations
occasioned by abandonment or withdrawal of operations, on public lands by the contractor, the
latter shall have a period of one (1) year therefrom within which to remove improvements;
otherwise all the infrastructure, facilities and equipment shall be turned over or donated tax-free to
the proper government authorities, national or local, to ensure that said infrastructure facilities and
equipment are continuously maintained and utilized by the host and neighboring communities. A
fine of one hundred thousand pesos (PhP100,000.00) shall be imposed for every day of delay.

CHAPTER X
BENEFIT SHARING, TAXES AND FEES

Section 98. Taxes and fees. The contractor shall pay all taxes and fees as required by law,
including, but not limited to:

a) contractor’s income tax;

b) customs, duties and fees on imported capital equipment;
) value-added tax on imported goods and services;

)_ withholding tax on interest payments on foreign loans;
©) withholding tax on dividends to foreign stockholders;
documentary stamps taxes;

2) capital gains tax;

h) excise tax on minerals:


}) local business tax;
}) real property tax;
) community tax;
1) occupation fees;
m) registration, accreditation, and permit fees;
n) water usage fees.

Section 99. Government share. Aside from the taxes and fees referred to in the preceding section,
Government shall have at least a share equivalent to ten per cent (10%) of the gross revenues from
the development and utilization of mineral resources that are owned by it to be set aside for the
general fund of the government to be used, among others, for special projects such as energy
development and generation and the management and conservation of protected areas in areas
within the vicinity or adjacent to mining operations.

Section 100. Indigenous cultural communities? royalty. In case of mineral operations within
ancestral domains, the contractor shall pay at least ten percent (10%) of the gross revenues as royalty
to the ICCs/IPs. Community development programs shall not be considered as royalty payment.
The payment of the royalties shall directly be given to the communities in a process that build on the
ICCs/IPs’ traditional and customary laws: Provided, That the royalty established in this Act shall be a
minimum royalty payment and may still be subject to other conditions to be agreed by the parties,
free from any external manipulation, interference, coercion, and other analogous acts, and obtained
after fully disclosing the intent and scope, including the positive and negative impacts of the activity,

in a language and process understandable and acceptable to them.

Section 101. Scientific research and development fund. A Scientific Research and Development.
Fund shall be set aside to be devoted to research and development of clean mining technologies,
improvement of mining processes, mine rehabilitation, mitigating technologies, setting up and
maintenance of an independent pool of experts, and operational expenses of the Bureau.

Section 102. Legal support services fund. A legal support fund shall be set aside for the use of
the communities and local government units for cases that they may file against mining permittees
or cases that may be filed against them by mining companies in trying to do their responsibility of
protecting the rights of the marginalized groups, the environment and sustainable development in
general.

Section 103. Local Government Unit share. Local Government Units shall be entitled toa’ share
of the net revenues from mining operations which shall be paid directly ito the
provincial /independent component city/highly urbanized city treasurer/s for distribution to, other
local government units. ‘To determine the government share, the following variables shall be
considered:

8) Classification of local government;

b) Vulnerability;

©) Human development index.

A percentage of this amount shall be set aside by the respective local government units for Disaster
Risk Management. This fund shall likewise benefit ICCs/IPs within the tertitory of the local
government unit. Provided, That the administrative and operational expenses of the Council shall also
be taken from this share.


Section 104. Mine wastes and tailings fees. A semi-annual fee to be known as mine wastes and
tailings fee is hereby imposed on all operating mining companies in accordance. with’ the
implementing rules and regulations. The mine wastes and tailings fee shall accrue to a fund, to be
used as support funds for monitoring activities of the Council. ‘The Secretary is authorized to
increase mine wastes and tailings fees, when public interest so requires.

Section 105. Incentives. Incentives that shall be given to the contractors shall only be limited to
pollution control or mitigation devices.

Section 106. Deposit of capital and profits requirement. As part of their demonstrated financial
capacity, all large-scale mining companies/contractors are required to deposit their capital
investment and profits in banks or financial institutions that are owned, managed and operated by
the Philippine government.

Section 107. General rule on profit repatriation. Contractors with foreign financial assistance
shall be allowed to repatriate their profits from mining projects that should not exceed fifty percent
(60 %) of the total posted at the end of every fiscal year. Full disclosure of profits is required. ‘The
full repatriation of profits shall be allowed one year after the cessation of mining activities and the
progressive rehabilitation of a mining area as specified in the mineral agreement of each contractor.

‘The guidelines for Sections 106 and 107 shall be issued by the Bangko Sentral ng Pilipinas and shall
be furnished to the Department, Bureau, Council and all respective contractors in the industry.

CHAPTER XI
SAFETY AND ENVIRONMENTAL PROTECTION

A. Safety

Section 108. Mines safety. All contractors and permittees shall strictly comply with all the mines
and safety rules and regulations concerning the safe and sanitary upkeep of the mines and mining
development. Government personnel involved in the implementation of mines safety, occupational
health and environmental rules and regulations shall be covered under Republic Act No. 7305 or the
Magna Carta of Public Health Workers.

Section 109. Mine labor. No person under sixteen (16) years of age shall be employed in any place
‘of mining operations and no person under eighteen (18) years of age shall be employed in a mine.

Section 110. Mine supervision. All mining and quarrying operations shall have at least, one (1)
licensed mining engineer for every fifty (50) employees. Such engineer/s shall have at least five (5)
years of experience in mining operations, and one (1) registered foreman.

Section 111. Safety of workers. All mining companies shall provide safeguards to the health and
well-being of workers. The Regional Office of the Department of Labor and Employment shall
inspect all mining sites within their areas of jurisdiction to determine the conditions of workers.
Denial of entry shall be punishable under this Act. Representatives of labor unions shall also have
visitorial rights.


Section 112. Mine inspection. The mines regional directors and the Council shall have jurisdiction
over the safety inspection of all installations, surface or underground, in mining operations at
reasonable hours of day or night and as much as possible in a manner that will not impede or
obstruct work in progress of a contractor or permittee. Monitoring reports and recommendations of
the Bureau shall be submitted to the Council.

Section 113, Power to issue orders. The mincs regional director, in consultation with the
Environmental Management Bureau, forthwith or within such time as specified in the order, require
the contractor to remedy any practice connected with mining, which is not in accordance with safety
and anti-pollution laws and regulations. In case of imminent danger to life or property, the Director
may summarily suspend the mining operation until the danger is removed, or appropriate measures
are taken by the contractor. Unreasonable delay to remove the danger or introduce the necessary
improvements by the contractor shall be a cause for the cancellation of the mineral agreement.

Section 114. Report of accidents. In case of any incident or accident, causing or creating the
danger of loss of life or serious physical injuries, the person in charge of operations shall
immediately report the same to the regional office where the operations are situated. Failure to
report the same without justifiable reason shall be cause for the imposition of administrative
sanctions prescribed in the rules and regulations implementing this Act

B. Environmental Protection

Section 115. Environmental Insurance. Contractors and mineral processing permit holders shall
be obliged to execute an insurance contract as an environmental assurance for each and every source
of pollution or disaster, relative to the “worst case scenario” costs, following accepted actuarial
standards, Provided, ‘That in no way shall this provision be construed to remove or reduce the li ibility
of the contractors and/or permit holders to compensate any damage caused by their operations.
Provided further, That the insurer shall be an accredited international company in good standing.

Prior to the approval of the insurance contract by the DENR, the DENR shall seck and consider
the opinion of an independent expert as to the financial credibility of the insurer.

Section 116. Calamity and Human Rights Protection Fund, Persons issued a mineral agreement
shall deposit five million pesos (PhP 5,000,000.00) semi-annually in an interest-bearing account a
common fund maintained by the national government which shall be used for responding to, or
ameliorating the effects of calamities, natural disasters and human rights violations including
militarization, displacement, and forcible evacuation in any part of the country in relation to mining,
activities. Provided, That in no way shall this provision be construed to remove or reduce the liability
of the contractors and/or permit holders to compensate any damage caused by theit operations.

Section 117. Performance Bond. ‘The contractor shall put up a bond in an amount equivalent to
fifty per cent (50%) of the projected cost of rehabilitation as validated by independent studies. ‘This
amount shall be deposited in an interest-bearing account: The bond shall be forfeited in the event
that the contractor shall fail or default in the rehabilitation or remediation of the mining area as
included in the work plan of the contractor or abandons the mine at any time of its operations.


Section 118. Rehabilitation. Contractors and permittees shall technically and biologically
rehabilitate the excavated, mined-out, tailings covered and disturbed areas to the condition of
environmental safety, as may be provided in the implementing rules and regulations of this Act. A
mine rehabilitation fund shall be created, based on the contractor's approved work program, and
shall be deposited as a trust fund in a government depository bank and used for physical and social
rehabilitation of areas and communities affected by mining activities and for research on the social,
technical and preventive aspects of rehabilitation. Failure to fulfill the above obligation shall mean
immediate suspension or closure of the mining activities of the contractor/permittee concerned.

Mining firms are hereby mandated to reforest 100 hectares of land for every one hectare of land they
utilize in the course of their mining operations. Mining firms are also mandated to immediately
restore and replant areas that they have already finished excavating as they move on to other
development sites: Provided, That if mining firms cannot do the reforestation in their immediate‘area
they could do the reforestation in other areas provided they comply with 100:1 hectare ratio. Any
mining firm found to have violated or have not complied with the foregoing mandatory provisions
shall be held liable with the penalty of revocation of their mining permits and payment of a fine of
not less than One Million Pesos (PhP 1,000,000). :

‘The owners, officers and management employee of said mining firms shall also be held liable and be
subject to imprisonment of not less than one (1) year nor more than three (3) years.

Section 119. Progressive rehabilitation. Contractors shall also conduct progressive rehabilitation
activities.

Section 120. Adoption of Precautionary Principle. When an a ity related to mining raises
threats of harm to human health or the environment, precautionary measures shall be taken
proactively even if some cause and effect relationship are not fully established scientifically. ‘The
mining proponent and the Bureau shall also be obliged to disclose whether or not the cause and
effect have not yet been scientifically established.

Section 121. Adoption of Polluter Pays Principle. Polluters shall pay for the damage they cause to
the environment. The amount of damages shall be determined by accredited independent
consultants, to be chosen from a list and agreed upon by both the mining proponent and by the
Council.

Section 122. Tailings impoundment. Tailings impoundments shall be built away from critical
watershed drainage areas. Furthermore, it shall be ensured that impoundments will not endanger
critical watershed areas or low lying valleys in the event of accidents under abnormal conditions.
‘ailing impoundments and dams shall meet the international standards for large dams.

Section 123. Dumping of waste. Dumping of waste or tailings in any body of water shall be
prohibited. Provisions on the Clean Water Act and Clean Air Act shall be strictly implemented.

Section 124. Use of toxic chemicals and methods. At all times, mining contractors shall use
chemicals or reagents which would result to the least environmental and social destruction. The use
of mercury and cyanide for the extraction of gold, silver and other minerals shall be prohibited. The
use of blow torching to separate gold from amalgam shall likewise be prohibited.


Section 125. Preservation of topsoil. The removed topsoil, or the more productive horizons of the
soil shall be preserved for other uses.

Section 126. Priority use for water. The National Water Resources Board shall investigate any
existing use of water resources in the area whether or not covered by any existing water permit ot
registration. Upon determination of any existing use, the applicant shall procure the consent of all
water users and/or the free prior and informed consent of ICCs/IPs with or without water permits
within the same groundwater network or any downstream users of water resources, In all instances,
priority shall be given to use of water for domestic, municipal, and agricultural purposes. If potential
hegative impact on other water users is identified, the water permit shall not be granted. For water
resources within the ancestral domain of indigenous peoples, no water permit shall be granted by the
National Water Resources Board without the free and prior informed consent of indigenous
peoples.

Section 127. Recyling of water resources. Water used in mining operations shall be recycled.
Mining contractors shall be required to provide for the methods or equipment for the recycling or
reuse of water. Released contaminated water shall be treated accordingly to mect national standards.
Released water must at least be equivalent in quality to the baseline water quality.

Section 128. Water user fee. A water user fee that reflects the value of water {0 the country and
community shall be imposed by the Council for water used in mining operations. Contractors shall
pay the fee to the National Water Resources Board which shall use the same for monitoting and
improvement of the affected waterways and systems and the mitigation of negative impacts thereon
to ensure that communities shall have access to clean water.

C. Acid Mine Drainage

Section 129. Prohibition from using acid-generating waste rock to build roads or dams. ‘To
prevent or mitigate acid mine drainage, there shall be a prohibition against using acid-generating
waste rock to build roads or dams or other infrastructures. The use of such materials shall only be
used after treatment to neutralize the effect of acid mine drainage.

Section 130. Establishment of a prediction and monitoring system, The Bureau shall establish
1 prediction and monitoring system to identify potential acid-producing materials and monitor theit
production of acid waste.

Section 131, Avoidance of waterways. Open pits, waste rock piles and tailings impoundments shall
not be built near or on waterways to prevent contact and subsequent acid production and
groundwater contamination.

Section 132. Remining. Remining shall be prioritized over the opening of new mines to maximize
and recover the remaining minerals from the rejects or wastes of previous mines and mining
operations, Provided, That remining operations shall follow the processes, standards, parameters and
guidelines set for mining operations in this Act.

Section 133. Suits after the termination of contracts or projects. Recognizing that the effects of
mining may be seen or felt, actions relating to the health of affected communities or peoples,
environmental degradation and other similar effects may be maintained against the project
proponent and/or persons even after the mineral agreement or mining project has terminated.


CHAPTER XII
RESOLUTION OF CONFLICTS

Section 134. Panel of arbitrators. There shall be a panel of arbitrators in the regional office of the
Department composed of three (3) members, two (2) of whom must be members of the Philippine
Bar in good standing and one a licensed mining engineer or a professional in a related field, and duly
designated by the Secretary as recommended by the Mines and Geosciences Bureau Director. ‘Those
designated as members of the panel shall serve as such in addition to their work in the Department
without receiving any additional compensation As much as practicable, said members shall. come
from the different bureaus of the Department in the region. The presiding officer thereof shall be
selected by the drawing of lots. His tenure as presiding officer shall be on a yearly basis. The
members of the panel shall perform their duties and obligations in hearing and deciding cases until
their designation is withdrawn or revoked by the Secretary. Within thitty (30) working days, after the
submission of the case by the parties for decision, the panel shall have exclusive and original
jurisdiction to hear and decide on the following:

2) Questions involving compliance with the established technical guidelines and standards
herein established, or those to be established by the implementing rules and regulations of
this Act;

b) Questions involving the compliance with technical procedures herein established, or those to
be established by the implementing rules and regulations; and,

©) Other similar instances wherein the technological and technical expertise of the Department
shall be needed.

Disputes involving real rights, contractual obligations and the other causes of action that are outside
the technological and technical expertise of the Panel of Arbitrators shall be under the jurisdiction of
the regular courts or as otherwise provided by other special laws.

Provided, ‘That disputes pending before the Bureau and the Department at the date of the effectivity
of this Act shall undergo an immediate review within sixty (60) working days upon the passage of
this Act to determine the cause of action. Those which are outside the technical expertise of the
Department or Bureau shall he refiled with the appropriate court, without costs to the complainant
or petitioner.

Section 135. Appeal. The decision or order of the panel of arbitrators may be appealed by the
party not satisfied thereto to the Mines Adjudication Board within fifteen (15) days from receipt
thereof which must decide the case within thirty (30) days from submission thereof for decisio!

Section 136. Mines Adjudication Board (MAB). ‘The Mines Adjudication Board shall be
composed of three (3) members. The Secretary of the DENR shall be the Chairperson with the
Director of the Mines and Geosciences Bureau and the Undersecretary for Operations of the
Department as members thereof. The Board shall have the following powers and functions:


2) To promulgate rules and regulations governing the hearing and disposition of cases before it
as well as those pertaining to its internal functions, and such rules and regulations as may be
necessary to carry out its functions;

b) To administer oaths, summon the parties to a controversy, issue subpoenas requiring the
attendance and testimony of witnesses or the production of such books, papers, contracts,
records, statement of accounts, agreements, and other documents as may be material to a
just determination of the matter under investigation, and to testify in any investigation or
hearing conducted in pursuance of this Act;

©) To conduct hearings on all matters within its jurisdiction, proceed to hear and determine the
disputes in the absence of any party thereto who has been summoned or served with notice
to appear, conduct its proceedings or any part thereof in public or in private, adjourn its
hearings at any time and place, refer technical matters or accounts to an expert and to accept
his report as evidence after hearing of the parties upon due notice, direct parties to be joined
in or excluded from the proceedings, correct, amend, or waive any error, defect or
irregularity, whether in substance or in form, give all such directions as it may deem
necessary or expedient in the determination of the dispute before it, and dismiss the mining
dispute as part thereof, where it is trivial or where further proceedings by the Board are not
necessary or desirable:

To hold any person in contempt, directly or indirectly, and impose appropriate penalties
therefor; and

6) To enjoin any or all acts involving or arising from any case pending before it which, if not
restrained forthwith, may cause grave or irreparable damage to any of the parties to the case
or seriously affect social and economic stability.

In any proceeding before the Board, the rules of evidence prevailing in courts of law or equity shall
not be controlling and it is the spirit and intention of this Act that shall govern. The Board shall use
every and all reasonable means to ascertain the facts in each case speedily and objectively and
without regard to technicalities of law or procedure, all in the interest of due process and social
justice. In any proceeding before the Board, the parties may be represented by legal counsel. The
findings of fact of the Board shall be conclusive and binding on the parties and its decision or order
shall be final and executory. i

A petition for review by certiorari and question of law may be filed by the agerieved party with the
Supreme Court within thirty (30) days from receipt of the order or decision of the Board.

CHAPTER XIII
ACCESS TO JUSTICE

Section 137. Obligation to respect human rights. Corporations shall respect, protect and
promote the human rights of communities affected by mining, including the right to life, liberty and
property, freedom of movement, right of public participation and the right to self-determination of
indigenous cultural communities.


Section 138. Violations of human rights. Extrajudicial killing, torture, involuntary disappearance,
forcible displacement of populations, setting up of checkpoints, and imposition of toll fees which
impede the freedom of movement within mineral areas, deprivation of food and water sources,
vote-buying and bribery for the purpose of securing consent or endorsement for the mining project,
and other analogous acts are violations of human rights. Violations of human rights by contractors
shall cause the immediate cancellation of mineral agreements. The offending contractor, as well as
corporations having the same directors and/or officers as of the offending contractor shall be
perpetually disqualified from being granted a mineral agreement. All equipment and assets of the
corporation or person shall be confiscated in favor of the government.

Section 139, Use of paramilitary and military forces. All mining companies are strictly prohibited
from employing paramilitary groups. Use of private and military forces shall result in the automatic
cancellation of the mineral agreement and the filing of appropriate civil, criminal and/or
administrative charges.

Section 140. Strategic Legal Action Against Public Participation (SLAPP). SLAPPs shall be
strictly prohibited. SLAPP is any legal action, whether civil, criminal or administrative, filed to
harass, vex, exert legal action or stifle legal recourses of community members complaining against
violations of this Act or enforcing the provisions of the Act, or exercising their freedom of assembly
or right of public participation. The investigating prosecutor or court shall immediately determine
within a period of thirty (30) days from filing thereof whether a legal action is a SLAPP and
accordingly dismiss the same.

Section 141, Indigents? suit. Indigents shall be exempt from payment of any administrative or
court fees, including docket fees for the filing of a case. Lawyers shall be provided by the Public
Attorney's Office to pauper litigants in case they could not afford legal services.

Section 142. Application of the customary laws of ICCs/IPs. The contractor shall respect the
customary laws of the ICCs/IPs and shall submit to the processes of their customary laws, Provided,
‘That these laws are not contrary to the provisions of the Constitution.

Section 143. Strict liability. Mining corporations are strictly liable for all damages that the mining
operations might cause. In case of any actual damage, the burden of proof shall lie with the
corporations.

Section 144, Piercing the corporate veil. When the separate personality of the corporation from
its shareholders is being invoked as defense in order to perpetuate a crime, fraud: or other
machinations, or evade liability, the separate personality of the corporation shall be set aside. Civil,
criminal and administrative actions may thus be filed directly against the members of the Board of
Directors, officers and/or individual stockholders.

Section 145. Citizen suits. For the purpose of enforcing the provisions of this Act or its
implementing rules and regulations, any citizen may file appropriate civil, criminal and administrative
suits against any of the following:

a) Any person who violates or fails to comply with the provisions of this Act ot its
implementing rules and regulations;


b) Any public officer with respect to orders, rules and regulations inconsistent with this Act;

9) Any public officer who willfully or grossly neglects the performance of an act specifically
enjoined as a duty by this Act or its rules and regulations; or abuses the authority in the
performance of a duty/ies under this Act or its implementing rules and regulations.

‘The court shall exempt such action from the payment of filing fees, except fees for actions not
capable of pecuniary estimation, and shall likewise, upon prima facie showing of non-enforcement
or violation complained of, exempt the plaintiff from filing an injunction bond for the issuance of a
preliminary injunction

‘The court shall determine whether or not the complaint is malicious or baseless and shall
accordingly dismiss the petition within thirty (30) days upon the filing of the case.

CHAPTER XIV
PENAL PROVISIONS

Section 146. Grounds for the cancellation of mineral agreements and permits:

2) Violation of any provision of this Act;

b) Human rights violations perpetrated by the contractor or any agent of the contractor;
) Non-payment of taxes;

) Bribery, use of force, intimidation, threat, coercion of public officials and communities;
©) Any act that shall create or contribute to confli

§) Other analogous acts.

Provided, ‘That, violations of environmental provisions shall cause the immediate cancellation of
mining permits, and the contractor shall be required to pay for the rehabilitation, restoration or clean
up of the impacts of such violations.

Corporations, corporate directors /officers found guilty of the above cnumeration may be subjected
to a perpetual ban in the mining industry in the Philippines.

Section 147. False statements. Any person who knowingly presents any false application,
declaration, or evidence to the Government or publishes or causes to be published any prospectus
or other information containing any false statement relating to mines, mining operations or mineral
agreements and permits shall, upon conviction, be penalized by a fine of not exceeding One
Hundred Thousand pesos (PhP100,000.00).

Section 148. Illegal exploration. Any person undertaking exploration work without the necessary
exploration permit shall, upon conviction, be penalized by a fine of not exceeding Five Million pesos
(P5,000,000.00).

Section 149. Theft of minerals. Any person extracting mincrals and disposing the same without a
mining agreement, lease, permit, license, or steals minerals or ores or the products thereof from
‘mines or mills or processing plants shall, upon conviction, be imprisoned from six (6) months to six
© years or pay a fine from One Hundred thousand pesos (P100,000.00) to One Million pesos


(PhP1,000,000.00) ot both, at the discretion of the appropriate court. In addition, he shall be liable
to pay damages and compensation for the minerals removed, extracted, and disposed of, In the case
of associations, partnerships, or corporations, the president and cach of the directors thereof shall
be responsible for the acts committed by such association, corporation, or partnership.

Section 150. Unauthorized dealing, selling, and/or buying of gold. Any person, partnership or
corporation who shall sell, buy or in any manner deal gold from any miner or person without being
duly authorized by the Bangko Sentral ng Pilipinas shall be punished as unauthorized dealing and
shall be penalized in accordance with the provisions in this Act.

Section 151. Destruction of mining structures. Any person who willfully destroys ot damages
structures in or on the mining area or on the mill sites shall, upon conviction, be imprisoned for a
period not to exceed five 6) years and shall, in addition, pay compensation for the damages which
may have been caused thereby.

Section 152, Mines arson, Any person who willfully sets fire to any mineral stockpile, mine or
workings, fittings or a mine, shall be guilty of arson and shall be punished, upon conviction, by the
appropriate court in accordance with the provisions of the Revised Penal Code and shall, in
addition, pay compensation for the damages caused hereby.

Section 153, Willful damage to a mine. Any person who willfully damages a mine, unlawfully
causes water to run into a mine, obstructs any shaft or passage to a mine, renders useless, damages
or destroys any machine, appliance, apparatus, rope, chain, tackle, or any other things used in a
mine, shall be punished, upon conviction, by the appropriate court, by imprisonment not exceeding
period of five (5) years and shall, in addition, pay compensation for the damages caused thereby.

Section 154, Illegal obstruction to permittees or contractors. Any person who, without
justifiable cause, prevents or obstructs the holder of any permit, agreement or lease from
undertaking his mining operations shall be punished, upon conviction by the appropriate court, by a
fine not exceeding Five thousand pesos (PhP 5,000.00).

Section 155, Vitiation of FPIC. Any person found to have vitiated the consent of the ICCs/IPs
through bribery, threat, force, and/or intimidation, or any other similar means, shall suffer the
penalty of six (6) years and one (1) day to ten (10) years in prison, and a fine of at least two million
pesos (PhP 2,000,000.00). If the perpetrator is a government official, the penalty shall be eight (8)
years and one (1) day to twelve (12) years imprisonment, and a fine of at least: four (4) million pesos
(PhP 4,000,000.00). He/she shall be perpetually prohibited from assuming public office, and shall
be disqualified from receiving other benefits by virtue of his /her position in government.

Section 156. Penalty for human rights violations. Contractors or other persons who have
violated the human rights of communities in connection with the mining operations shall be
penalized with ten (10) years to fourteen (14) years imprisonment and a fine of at least five million
pesos (PhP 5,000.000,00) and shall indemnify the victims.

Section 157. Amendment to Section 27 of Republic Act No. 7076 or the Small-scale Mining
Act. Violations of the provisions of RA 7076 or of the rules and regulations issued pursuant hereto.
shall be penalized with imprisonment of six (6) years and 1 day to twelve (12) years. ‘The State shall


confiscate and seize equipment, tools and instruments; effect immediate suspension or closure of
the mining activities of the permittee concerned, and revoke the permit.

Section 158. Abandonment. Contractors and/or permittees who shall abandon mines shall be
perpetually banned or disqualified from conducting mining operations, directly or indirectly. The
ban and/or disqualification shall include the officers and directors of corporations that have
abandoned mines.

Section 159. Confiscation of equipment and property. The equipment and property of
contractors and permit holders violating this Act shall be forfeited in favor of the government.

Section 160. Non-application of the corporate veil. Any person violating the provisions of
Commonwealth Act No. 108, or the Anti-Dummy Law of the Philippines as amended, or is found
to have used the corporate structure to defeat the provisions of this Act shall suffer the penalty of
five million pesos (PhP 5,000,000.00) and perpetual ban in the mining industry.

Section 161. Reinstatement of revoked permits. After notice and hearing, revoked permits that
have undergone due process may be reinstated, Provided, That it may only be reinstated once.

CHAPTER XV i
TRANSITORY PROVISIONS

Section 162. There shall be a moratorium on all mining activities until all the systems are in place
for the proper implementation of the law.

Section 163. All cxisting mining permits, licenses and agreements are hereby deemed cancelled.
Those mine workers and their families that may be displaced during the transition period shall
receive livelihood support and job placements to be facilitated by the appropriate agencies of the
State.

Section 164. The classification of public lands as mineral reservations pursuant to pre-existing laws
shall hereby cease. All such lands shall be dosed to mining unless opened thereto in accordance
with the provisions of this Act. The President's power to declare mineral reservations shall
henceforth cease to exist. A review of the current mineral land classification shall be conducted to
determine the best livelihood and economic option for the said area.

Section 165. The members of the panels of arbitrators and the provincial or city mining regulatory
boards established under Republic Act No. 7942 shall hold-over their positions until replaced in
accordance with provisions of this Act.

CHAPTER XVI
FINAL PROVISIONS

Section 166. Separability clause. The provisions of this Act are hereby declared to be separable
and, in the event of any such provisions are declared unconstitutional, the other provisions which
are not affected thereby shall remain in force and effect.


Section 167. Repealing clause. Republic Act 7942, Presidential Decree 463, Presidential Decree
512, and other related mining laws are hereby repealed. All provisions in laws, decrees, issuances and
other regulations inconsistent with this present law shall be deemed amended or repealed if the
inconsistency is irreconcilable.

Section 168. Funds. The amount of One Hundred Billion Pesos (PhP 100,000,000,000.00) is
hereby appropriated for the proper functioning of the Bureau, the Council, and other bodies
established under this Act of which half of the said amount shall be allotted for the baseline mineral
exploration activities of the Bureau,

Section 169. Implementing rules and regulations. ‘The implementing rules and regulations of
this Act shall be the product of joint collaboration by the Department, and representatives from the
local government units, peoples’ organizations, sectoral organizations and non-governmental
organizations, and shall be drawn up after appropriate and exhaustive public consultations at all
levels nationwide.

Section 170. Effectivity clause. This Act shall take effect within fifteen (15) days following its
publication in two national newspapers of general circulation in the Philippines.