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Part B: Mineral Rights - Part B-6: Beneficiation - Processing, Trade & Transport - 35. Beneficiation – Processing, Trade and Transport | 35.1 Institutional Framework for Beneficiation and Trade of Development Minerals

The mining law should make provision for an institutional framework for the licensing and regulation of processing, trade and transport of development minerals that is most expedient, efficient and appropriate for the promotion of the subsector. It should also be consistent with the Constitution and government structure of the country and with other laws and rights that might apply or be affected.

When these activities are conducted as part of an integrated mining operation, they should generally be licenced and regulated by the Regulating Authority as part of the integrated mining project.

However, when development mineral beneficiation is conducted separately by independent actors, depending on the scope, type and complexity of the activity, it may be licenced by a national authority or by a provincial regulating entity that coordinates with the national Regulating Authority responsible for mining. For example, licensing of a cement plant might be by a national authority whereas a crushing plant for aggregates might be licenced by a provincial or state regulating entity. Similarly, the licensing of trader/dealers who trade in a national or regional market and the licensing of transporters who transport development minerals throughout a national or regional market should be the responsibility of a national licensing authority, whereas a provincial/state regulating entity should have responsibility for the licensing of such activities that operate solely within a single province/state. Furthermore, the national licensing authority for a complex processing facility, or a nationwide or regional trader or transporter may be different than the Regulating Authority that issues mineral licences.

Multiple licences from multiple regulating entities may be necessary for these activities (e.g., business, environmental, etc.). However, licensing requirements should be tailored to the national and regional context and capabilities, avoiding overlapping and excessive burdens while protecting the public interest. Therefore an institutional framework for coordination among the regulating entities involved is highly desirable.

The mining law should specify which regulating entities or authorities are responsible for issuing standards and regulations for the implementation of the law with respect to the various activities, including in particular the sequencing of any multiple licensing requirements.

35.1. Example 1:

Article [_]

(1) Integrated projects to mine, process, transport and trade development minerals shall be licenced and regulated by the [Regulating Authority], which shall issue regulations specifying the applicable requirements consistent with the provisions of this Act.

(2) Independent processing of development minerals, whether integrated with transport and/or trade of such minerals or separate, shall be licenced and regulated by the [national regulating entity] in the case of [processing facilities specified here or in the regulations] and in all other cases by [the provincial/state regulating entity]. The national or provincial/state licensing authority shall issue regulations specifying the requirements applicable to the processing facilities, trade and transport activities for which they are the licensing authority, consistent with the provisions of this [Act][Code][Law].

(3) Independent trade in development minerals shall be licenced and regulated by the [national regulating entity] in the case of [trade activities that are national or regional in scope] and by [the provincial/state regulating entity] in the case of trade activities that are carried out solely within the province/state. The national or provincial/state licensing authority shall issue regulations specifying the requirements applicable to the trade activities for which they are the licensing authority, consistent with the provisions of this Act.

(4) Independent transport of development minerals shall be licenced and regulated by the [national regulating entity] in the case of [transport activities that are national or regional in scope] and by [the provincial/state regulating entity] in the case of trade and/or transport activities that are carried out solely within the province/state. The national or provincial/state licensing authority shall issue regulations specifying the requirements applicable to the transport activities for which they are the licensing authority, consistent with the provisions of this [Act][Code][Law].

(5) Notwithstanding the foregoing, other licences from other authorities may be required for these activities.

(6)The licensing authority specified in this [Act][Code][Law for the particular activity shall be the lead authority for purposes of organizing a coordinating mechanism among multiple licensing authorities.

Annotation

This provision distinguishes between processing, trade and transport of development minerals that are part of an integrated project and those that are conducted separately from the extraction of the minerals. It provides that the Regulating Authority (e.g., often the Mines Ministry) shall be the licensing and regulating authority of the integrated projects. This provides a one stop shop for the licensing and regulation of the integrated projects and nationwide consistency in the application of policy to them.

The provision states that a national or provincial regulating entity shall be the licensing and regulating authority for the licensing of independent development minerals processing, trading and transport, depending on the type of processing facilities and the scope of the trade or transport activities. The larger scale and more complex processing facilities such as cement plants would be licenced by a national regulating entity, which may be the Ministry of Industry rather than the Mines Ministry. The smaller scale and less complex processing facilities such as crushing plants for aggregates would be licenced by a provincial or state regulating entity.

Similarly, the provision also states that trade and transport of development minerals that are conducted separately from extraction by independent actors would be licenced and regulated by a national regulating entity if the activities are national or regional in scope, but would be licenced and regulated by a provincial or state regulating entity if the activities are to be conducted solely within a single province or state. Since these activities are commercial activities that do not involve extraction of minerals, they can be appropriately licenced and regulated at the provincial/state level, which is more readily accessible and provides greater flexibility, when the activities take place solely within that jurisdiction. Trade and transport of development minerals that are national or regional in scope must be licenced and regulated at the national level in order to be able to operate in multiple provinces or states, and within neighbouring countries.

For both trade and transport of development minerals, the licensing and regulating entity may be different from the Regulating Authority for mining; and different licensing authorities may be responsible for trade and transport, respectively (for example, the Ministry or Department of Commerce and Trade, on the one hand, and the Ministry or Department of Transportation, on the other hand), at both the national and provincial/state levels.

The example provides that the entity responsible for licensing and regulating the activity is the entity authorised to issue regulations for the activity, provided that they must be consistent with the provisions of the Act.

Finally, the provision makes clear that other licensing requirements may apply, in which case it provides that the entity that is the licensing authority under the Act is to be the lead authority for organizing a coordinating mechanism to enhance efficiency, proper sequencing and reduction of overlaps.