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Part C: Fiscal Terms - 36. Fiscal Terms | 36.9 Other Fees

“Other fees” cover a range of other payments a mining company may be required to make, depending on the laws within a particular country, including fees for registering the company locally, processing of mining license applications, stamp duties, and so on. These fees tend to be relatively small but can serve to augment budgets of administrative agencies and defray their costs. They should not be seen as a main fiscal tool and, where possible, should be minimized in favour of emphasis on main tools like royalties and corporate income tax.

36.9. Example 1:

Article [_]

(1) The issuance of mining rights and authorisations as well as, where applicable, their renewal, extension, continuation, transfer, assignment, and lease, are subject, upon the granting of the deed conferring the rights, to the payment of a fixed fee, the amount and terms of which are determined by regulations.

(2) Collection agents, trading douses, and accredited trading agencies for the trading of diamonds, gold and other precious substances are subject to the payment of a fixed annual royalty, the amount of which is determined by regulation.

(3) No licence granting a mining right shall be issued by the [Regulating Authority] until all prescribed fees payable in relation to the grant and registration of that licence have been paid.

Annotation

Adapted from Guinea’s mining code (2011) and Sierra Leone’s mining code (2009), these provisions together highlight a type of fee commonly included in mining laws: administrative fees associated with certain acts of processing necessary for the progression of a project. These fees provide small revenues to the state, which can be useful during the stages before production begins.

See discussion of property tax, 36.3(d).

36.9. Example 2:

Article [_]

An operating licence holder shall be required to contribute to the financing of capacity building and skills transfer for officials with [the regulating authority] and to the training of mining engineers and geologists from [Country]. The terms for this contribution shall be determined by decree.

Annotation

Drawn from Cote d’Ivoire’s mining code (2014), this provision details a payment that companies are required to make in order to reinforce the capacity of the regulating entity. Such a fee can be a meaningful contribution, but also carries with it the risk of conflict of interest. Countries considering this kind of approach should consider whether there are other modalities for promoting capacity development in the regulating entity with fewer risks. When this kind of approach is selected, a country should seek strong rules guarding against the conflict of interest risk.