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Part A: General Topics | 13. Anti-Bribery/Anti-Corruption/Conflict of Interest

Anti-bribery/Anti-corruption/conflict of interest often refer to provisions that prohibit license holders and government officials from engaging in fraud and corruption as it applies specifically to all activities related to mining operations. The inclusion of anti-bribery and anti-corruption provisions in mining laws, focusing on both the demand side (officials) and the supply side (companies or individual intermediaries), is a recent innovation that reflects a strong commitment to deter corruption in the administration of the sector. These provisions may also lay out processes that further discourage both license holders and government officials from engaging in corrupt and fraudulent activities such as language prohibiting government officials from individually owning a stake in mining operations. To the extent that economic penalties and sanctions are provided for in the mining code the sanctions should be meaningful for deterrence.

Although anti-corruption and anti-bribery provisions usually belong to the realm of criminal law, international best practice promotes the reinforcement of such prohibitions in mining laws, given high corruption risks in the sector. To the extent that economic penalties and other sanctions are provided for in the mining code, these should be meaningful for deterrence.

The inclusion of anti-bribery and anti-corruption provisions in mining laws is a recent innovation that reflects a strong commitment to deter corruption in the administration of the law. The more traditional provisions (see Example 3) focus on conflict of interest. This subject may be sufficiently treated in general laws sanctioning bribery and corruption and not necessitate specific sectoral measures in the mining law.

13. Example 1:

Article [_]

(1) It is a prosecutable offence for any company which is active in the mining sector or has any interest in it, including any director, shareholder, employee, representative or subcontractor of such a company to make offers or promises, or offer donations, gifts or benefits of any kind whatsoever:

(a) a government official or an elected representative so as to influence a decision or an action taken as part of the carrying out of their public functions, including those which relate to the mining sector;

(b) any other individual, association, company, natural person or legal entity so as to use their imputed or actual influence over any action or decision by any government official or an elected representative as part of the carrying out of their public function, including those which relate to the mining sector.

Article [_]

Should a mining rights holder or one of their officials, directors, employees, representatives, subcontractors or shareholders, duly acting in the name of said mining right holder, violate the provisions of the present [Code][Act][Law] relating to the prohibition of corrupt activities, this may lead to penalties including, without limitation, revoking the relevant mining right. The penalty shall be applied once there has been an investigation into the severity of the offence, the time which has lapsed since the offence was committed, the actions implemented by the rights holder in order to report the offence and inform the government, the level of investment which the rights holder has already expended to develop the project.

Article [_]

It is a prosecutable offence for any civil servant in the judiciary or administration, or any other representative of the Civil Service of [Country], or any elected representative responsible for deciding on an administrative action in the mining sector to solicit or accept offers, promises, donations, gifts or benefits of any kind whatsoever, to perform, refrain from performing, or to abuse their influence in the carrying out of their functions, in particular in the context of allocating mining rights, overseeing activities and payments, and approving applications, or decisions relating to the extension, subleasing, assignment, transfer or cancellation of a mining right.

Annotation

Drawn from Guinea’s mining law (2011), this provision seeks to establish a balanced framework for dealing with bribery and corruption. Supply side measures include prohibition of mining companies from inducement of public officials in relation to decisions on mineral rights, requirement of mineral right holders to sign a code of conduct to respect anti-bribery laws, to submit to anti-bribery investigations where necessary, and to uphold the EITI principles. Additionally, mineral right holders must prepare and submit an anti-corruption monitoring plan to be published annually setting out among other things the holder’s compliance with anti-corruption provisions, control measures instituted to prevent corruption and how bribery allegations have been dealt with. Demand side measures include prohibition against solicitation and acceptance of bribes by public officials in relation to any decision making concerning mineral rights.

13. Example 2:

Article [_]

(1) No public officer shall directly or indirectly, acquire any right or interest in any mineral right and any document or transaction purporting to confer any right or interest in any such officer shall be null and void.

(2) Subject to subsection (3), no public officer shall own or retain any shares in a company carrying on reconnaissance, exploration or mining operations, or the import, export or marketing of minerals in the country.

(3) Where an officer is at the assumption of the functions of his office, the holder of shares in such company as is mentioned in subsection (2), the officer shall divest himself from such right or interest or dispose of the shares within ninety calendar days after assumption of office.

(4) An officer who contravenes this section commits an offence and shall be liable on conviction to a fine not less than [insert appropriate amount that would be sufficient for deterrence] United States Dollars or its equivalent in [national currency] or to a term of imprisonment not exceeding twelve months or to both such fine and imprisonment.

(5) For the purposes of this section, “officer” means a public officer for the time being engaged in the administration of this [Act][Code][Law].

Annotation

Adapted from Sierra Leone’s mining law (2009), this provision, in contrast with Example 1, is focused on conflict of interest and abuse of office situations. It requires public officials responsible for administering the mining law not to hold any interest in any mineral operations. This provision will affect persons who own a direct interest in mineral operations.