RECEIVED

Republic of the Philippine: pare 08 AUG 2016
HOUSE OF REPRESENTAT' 7

Quezon City Time TM

BY: wh
SEVENTEENTH CONG!

First Regular Session pore

2633 |

House Bill No.

Introduced by AKBAYAN Representative Tomasito S. Villarin

EXPLANATORY NOTE

Upon appointment of Ms. Gina Lopez as Secretary of the Department of
Environment and Natural Resources (DENR), she immediately ordered the
audit of all existing mining operations in the Philippines. The audit seeks to
establish the current scale of operations of mining firms and ascertain if
there are violations of existing mining regulations.

To date, the audit of mining firms continue with particular focus on those
operators with alleged violations.

‘The current law governing exploitation of mineral resources in the country is
Republic Act No. 7942, otherwise known as the “Philippine Mining Act.” It
liberalized the mining industry and was highly touted to spur economic
growth at the time of its approval into law on 3 March 1995

However, after 20 years of its operation, the Mining Act was not able to meet
its objective of bringing economic growth and rural progress. Its hyped
promises were never attained.

What the mining actually ushered were externalities such as the massive
destruction of the environment, displacement of communities, blatant
disregard for the rights of indigenous peoples in their ancestral domains,
and human rights violations.

Therefore, there is a need to replace the existing mining rules in the country
It must be replaced with a new set of rules gathered from inputs not only
from experts, but also from the inputs of environmental advocates,
indigenous peoples and communities.

Specifically, this bill seeks to assure that primacy will be given on the
benefit of the people and the country over the interests of mining
concessionaires, Specifically, environmental protections, sustainable
livelihoods should be prioritized, humane conditions in the communities,
and local participation are given primary importance in this bill.

HUGS. F R PRESENT AHIVES


During, the 16% Congress, this legislative proposal was also filed by
Akbayan’s representatives and other district representatives seeking to

reform the current mining regime.

‘Thus, the immediate passage of this bill is earnestly sou,

at
TOMASITO S. VILLARIN


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session
2633

House Bill No.

Introduced by AKBAYAN Representative Tomasito S. Villarin

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 2016.”

SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to:

a. 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;

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

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

c. Value the dignity of every human person and guarantees full respect for
human rights;

f. Promote social justice in all phases of national development;


g. Recognize and promote the rights of indigenous cultural 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;

i 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 to self-determination;

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

k. Ensure the autonomy of local governments;

1. 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

n, Adopt and accept the generally accepted principles as embodied in the
International Covenant on Civil and Political Rights, International
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.

SEC. 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.

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


The current export-orientation 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;

‘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;

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 their 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 technology 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  seli-
determination and ancestral domain shall be recognized and their
collective property rights are guaranteed by this Act;

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 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, harnessed,
expanded and upgraded;


m. 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;

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

o. 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 communities;

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

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

SEC. 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 IL
SCOPE AND GENERAL PRINCIPLES

SEC. 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

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accordance to the existing national and international policies on our
indigenous peoples.

SEC. 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.

SEC. 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.

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

SEC. 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 respective 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.

SEC. 13.— Mining shall be limited in scale in accordance with this Act.

SEC. 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.

SEC. 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.

SEC. 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

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rehabilitation/restoration of the immediate environs or each mining
project/activity in the country as provided by law.

SEC. 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.

SEC. 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.

SEC. 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

SEC. 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;

b. 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

7


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/IPs) 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);


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

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

Certificate of Ancestral Lands Title (CALT) ~ a title formally recognizing
the rights of ICCs/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;


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Critical habitats ~ place or 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 or 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 significance;

Customary laws - body of written and/or unwritten rules, 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,
electromeganetic, radar, induced polarization, radio-wave and
electrogeochemical;

Extraction ~ ore-removal activities that take place at the mine site
itself;

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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 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

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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 or 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 — either 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

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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;

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;

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

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;

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;

Ore ~ a material that contains minerals in such quantities that it can
be mined and worked commercially to extract that mineral. The
mineral is usually contained in chemical combination with some
other element 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;

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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 issued;

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

Progressive rehabilitation ~ rehabilitation which involves the staged
treatment of disturbed areas during —_ exploration,
construction/development and mining operations;

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;

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

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 underneath the surface of private or public
land;

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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
people;

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 original ecosystem,
and most of the original biodiversity: in time ecological processes and
functions will match those of the original forest;

Self-determination- 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 government within existing national borders to achieve a
greater degree of autonomy to help preserve their culture, ancestral
domain, and way of life;

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

4s


large-scale, otherwise, the mining activity shall be defined as large-
scale mining;

iii, Small-scale mining permit ~ permit issued for small-scale mining;

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

lll. 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;

nnn, 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

SEC. 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 researchof
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.

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

SEC. 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

16


governmental offices and other bodies created under this Act shall copy furnish
the Bureau of all other information related to mining.

SEC. 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

SEC. 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.

SEC. 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.

SEC. 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

SEC. 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/IPs 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.

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

SEC. 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.

SEC. 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

a


different title issued in favor of members of the [CCs/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

SEC. 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.— |P/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.

SEC. 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.

SEC, 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 to the provisions of this Act.

SEC. 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:

a. the classification of minerals;

b. the quality and grade of the ore;

c, the potential mine life;

d. the geological description of the area;

¢. the economic viability of mine tailings;

f. whether the area is a key biodiversity area or if it is a critical habitat;
and

g. 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.

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SEC. 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

SEC. 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.

SEC. 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.

SEC. 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.

SEC, 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.

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

To determine whether or not mining operations shall be allowed;
To deliberate on proposals for mineral agreements;
‘To approve the proposal for mineral agreements;
d. To monitor the conduct of mining operations; and
¢. To establish its internal rules of procedure which are not contradictory
to this Act.

poe

SEC. 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/IPswithin the watershedcontinuum.The Bureau shall be the
convenor of the Council.

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

SEC. 43.Areas open to mining. The Council shall have thepower 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;
g. Potential economic benefits of the development and utilization of the
minerals;
h. Carrying capacity and the ecological profile of the area;
i, Existing and alternative land uses of the area; and
j. Local government land use plan.

meeoge

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 acceptable 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 from 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
tesource 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;

Densely populated areas, especially residential areas;

Head waters of watershed areas;

Areas with potential for acid mine drainage:

Critical watersheds;

peas

20


Critical habitats;

Climate disaster-prone areas;

Geohazard areas;

Small island ecosystems;

Cultural sites, which may include, but not limited to,
burial grounds;

‘Traditional swidden farms and hunting grounds;
Lands covered by the Comprehensive Agrarian Reform Law or Republic
Act No. 6657, as amended;

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

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

Community sites;

Key biodiversity areas;

High conflict areas;

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

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 or private works including
plantations or valuable crops, except upon written consent of the
government agency /agencies or private entity concerned;

In areas expressly prohibited by law or ordinances;

In areas covered by small-scale miners as defined by law unless with
prior 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

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 their 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.

sacred sites and

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 use of said area.

SEC. 44.Process of determination for opening an area to mining. — Alter
the submission of the exploration report and the resource valuation report, the

21


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 their 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 further, 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 finally, That any member of the community may file a protest with the
Council during the periodof consultations and deliberations for the Council's
consideration.

SEC. 45.Violation of Section 54.- Local government officials who are
administratively found to violate the preceding section and Section 54 of this
Act vis-a-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

SEC. 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

22


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

SEC. 48, Modes of mineral agreement. A mineral agreement may only take
the following forms as herein defined;

a, 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 to 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.

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 orpersons.

SEC. 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.

SEC. 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,

23


SEC. 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:

a. demonstration of financial capability;
b. proven social and environmental track record, including those of its
officers and directors;

c. clear corporate structure and ownership;

d. proof of physical office and operations of the proponent within the

Philippines;

identification of potential investors;

mining project feasibility;

mining operation work plan;

proposed operation, mitigation and prevention methods and/or

equipment;

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

peee

a eee

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.

SEC. 52. Environmental and Social Impact Assessment and Mitigation
Plan. The contractor 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 areas; aquaculture, watershed
development and water conservation; the relocation and return of displaced
population; and provisions for alternative livelihood and socioeconomic
development,

‘The ESIAMP 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.

24


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

SEC. 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 required under this Section.

SEC. 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

SEC. 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.

SEC. 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 ESIAMP 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 ESIAMP shall cause the cancellation
of the Certificate.

SEC. 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

25


also include corporations that shall have common directors or significant
shareholders.

SEC, 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
rehabilitation 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.

SEC. 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.

SEC. 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.

SEC, 62.Mandatory consultations in each mining phase. Mandatory
consultations with affected persons and communities shall be undertaken in
each 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.

SEC. 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.

26


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

SEC. 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.

SEC. 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.

SEC. 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

SEC. 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:

a. ‘The full disclosure of methods and processes of mining;
b. The full disclosure of environmental and social risks;
c. The full disclosure of ownership structure; and

d The full disclosure of financial sources.

27


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

SEC. 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 or 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.

SEC. 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.

SEC. 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.

SEC. 71.FPIC in small-scale mining. - Small-scale mining activities within

any ancestral domain by any person shall also require the free, prior, and
informed consent of ICCs/IPs.

28


SEC. 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 (ESICC) 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)

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 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:

a. 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 or recycling;

c. facilitating partnership among small-scale mining cooperatives;
and
a. other incentives to attract informal small-scale miners to formalize

their status.

SEC. 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.

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CHAPTER VII
QUARRY RESOURCES

SEC. 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
toat 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.

SEC. 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 liew
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

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

SEC. 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:
Provided, 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,

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SEC. 82.Commercial Sand and Gravel Permit. Any qualified person may be
granted a 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.

SEC. 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.

SEC. 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.

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

SEC. 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.

SEC. 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.

SEC. 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.

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SEC. 89.Council recommendation for approval.— All permits under Chapter
VII of this Act shall require the recommendation of the Multi-Sectoral Mineral
Couneil 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

SEC, 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.

SEC. 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.

SEC, 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.

SEC. 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 are parties to a Mineral Agreement or a Financial or Technical
Assistance Agreement, holders of quarry 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

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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

SEC. 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.

SEC. 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.

SEC. 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 their imported
counterparts.

SEC. 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

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CHAPTER X
BENEFIT SHARING, TAXES AND FEES

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

contractor's income tax;

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;

capital gains tax;

excise tax on minerals;

local business tax;

real property tax;

community tax;

occupation fees;

m, registration, accreditation, and permit fees; and

n. water usage fees.

FrocpeR me oo sp

SEC. 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.

SEC. 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 [CCs/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.

SEC. 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,

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mine rehabilitation, mitigating technologies, setting up and maintenance of an
independent pool of experts, and operational expenses of the Bureau.

SEC. 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.

SEC. 103,Local Government Unit share. Local Government Units shall be
entitled to a share of the net revenues from mining operations which shall be
paid directly to 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:

a. Classification of local government;
b. Vulnerability; and
c. 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 territory of the local government unit. Provided,
That the administrative and operational expenses of the Council shall also be
taken from this share.

SEC. 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.

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

SEC. 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.

SEC. 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 (50 %) of the total posted at the
end of every fiscal year. Full disclosure of profits is required. The full

35


repatriation of profits shall be allowed one year alter 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

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 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 willnot impede or obstruct work in progress
of a contractor or permittee. Monitoring reports and recommendations of the
Bureau shall be submitted to the Council.

SEC. 113. Power to issue orders. — The mines 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

36


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

SEC. 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

SEC. 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 liability 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
seek and consider the opinion of an independent expert as to the financial
credibility of the insurer.

SEC. 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 their operations.

SEC. 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

37


area as included in the work plan of the contractor or abandons the mine at
any time of its operations.

SEC. 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

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

SEC. 120. Adoption of Precautionary Principle. - When an activity 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.

SEC. 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.

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SEC. 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.

SEC. 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.

SEC. 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.

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

SEC. 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 or 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 negative 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.

SEC. 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 meet national standards.
Released water must at least be equivalent in quality to the baseline water
quality.

SEC. 128.Water user fee. A water user fee that reflects the value of water to
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 monitoring 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.

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C. ACID MINE DRAINAGE

SEC. 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.

SEC. 130. Establishment of a prediction and monitoring system. The
Bureau shall establish a prediction and monitoring system to identify potential
acid-producing materials and monitor their production of acid waste.

SEC. 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.

SEC. 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.

SEC. 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

SEC. 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 thirty (30) working days, after the

40


submission of the case by the parties for decision, the panel shall have
exclusive and original jurisdiction to hear and decide on the following:

a. 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,

c. 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 be refiled with the appropriate court, without costs to the
complainant or petitioner.

SEC. 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 decision.

SEC. 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:

a ‘Topromulgate 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

41


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;

c. ‘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:

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

e. 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.

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

CHAPTER XIII
ACCESS TO JUSTICE

SEC. 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

42


public participation and the right to self-determination of indigenous cultural
communities.

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 144,Piercing the corporate veil. When the separate personality of the
corporation from its shareholders is being invoked as defense in order to

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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.

SEC. 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 or its implementing rules and regulations;

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

c. 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
or duties 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

SEC. 146. Grounds for the cancellation of mineral agreements and
permits. -

a. _ Violation of any provision of this Act;

b. Human rights violations perpetrated by the contractor or any agent
of the contractor;

c. Non-payment of taxes;

d Bribery, use of force, intimidation, threat, coercion of public
officials and communities;

e. Any act that shall create or contribute to conflicts; and

f Other analogous acts.

4g


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 and/or officers found guilty of the above
enumeration may be subjected to a perpetual ban in the mining industry in the
Philippines.

SEC. 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 (PhP 100,000.00).

SEC. 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).

SEC. 149. Theft of minerals,— Any person extracting minerals 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 (6) years or pay a
fine from One Hundred thousand pesos (P100,000.00) to One Million pesos
(PhP1,000,000.00) or 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 each of the directors thereof shall be
responsible for the acts committed by such association, corporation, or
partnership.

SEC. 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.

SEC. 151.Destruction of mining structures.— Any person who willfully
destroys or 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 (5) years
and shall, in addition, pay compensation for the damages which may have been
caused thereby.

SEC. 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

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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.

SEC. 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 a period of five (5) years and shall, in addition, pay compensation
for the damages caused thereby.

SEC. 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).

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 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

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SEC. 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

SEC. 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.

SEC. 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
TRANSITORY PROVISIONS

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

SEC. 163. - All existing 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

SEC. 164.- The classification of public lands as mineral reservations pursuant
to pre-existing laws shall hereby cease. All such lands shall be closed 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.

SEC. 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

SEC. 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.

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SEC. 167. Repealing Clause. — Republic Act No. 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.

SEC. 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.

SEC. 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.

SEC. 170. Effectivity This Act shall take effect within fifteen (15) days
following its publication in two (2) national newspapers of general circulation in
the Philippines.

Approved,

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