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Part A: General Topics - 22. General Offenses and Penalties | 22.2 Liability

Mining activity entails high risk for all the stakeholders involved. Since a substantive share of the activities are carried out by the operator (either a private corporation or a state owned company), thus making it the better risk bearer and the liability should be clearly borne by the operator. The operator should clearly know the extent of that liability, and if it extends to its shareholders, agents or other representatives.

Insurance and warranties can replace liability, but if they are not available or applicable for any reason, the responsibility of indemnification resides in the operator or holder of mineral rights.

22.2 Example 1:

Article [_]

(1) The holder of a mineral right shall indemnify, defend and hold the [Country] harmless against all actions, claims, demands, injury, losses or damages of any nature whatsoever, including claims for loss or damage to property or injury or death to persons, resulting from any act or omission in the conduct of mining operations by or on behalf of the holder.

(2) Such indemnity under subsection (1) shall not apply to the extent, if any, that any action, claim, demand, loss, damage or injury has resulted from any direction given by, or wrongful act committed on behalf of, the [Country].

Annotation

Drawn from Tanzania’s mining law (2010), this provision places liability obligations in the rights holder except in cases where the wrongful act was ordered or carried out by the country.

22.2 Example 2:

Article [_]

Holders of mining rights are liable to the State for breaches committed under this [Law][Act][Code] by themselves, their employees, agents, contractors and/or subcontractors. When several persons jointly hold Mineral or Quarry Rights, their liability is joint and several.

Annotation

Drawn from Liberia’s mining law (2000), this provision provides for joint and several liability to eliminate the determination of relative culpability and avoid compounded disputes concerning the extent of liability when multiple parties are involved.