Structures for traditional miners to undertake mining activities

The National Development Plan confirmed the structures established by the law in order for the traditional miners to undertake activities in the area of a third party’s mining concession contract, i.e. mining formalization subcontracts and areas’ devolution for mining formalization.

Areas’ Integration

The National Development Plan sets forth the possibility to integrate areas of mining titles from different types and that have been granted under any legal regime, even if they are not adjacent, provided that they belong to the same deposit.

Fee

Article 20 of the National Development Plan modified article 230 of the Mining Code and established that the calculation of the fee payment shall be made taking into account the number of hectares and the year of the exploration stage in which the concession agreement is when the payment is made. The amount to be paid is calculated in legal daily minimum wages per hectare as follows:

No. Hectares	0-5 years	5-8 years	8-11 years
0-150	0,5	0,75	1
151-5.000	0,75	1,25	2
5.001-10.000	1,0	1,75	2

The fee payment for the construction and assembly stage will be the equivalent to the fee paid for the last year of the exploration stage.

Reserve Areas for the Mining Development

The National Development Plan enabled the mining authority to determine for an indefinite period, special areas for the exploration and exploitation of minerals of strategic interest for the country.

Said areas will be granted by means of objective selection processes.

Areas Reserve for Mining Formalization.

The national mining authority will be able to establish reserve areas for mining formalization.

For this purpose, the mining authority shall be entitled to use free areas or areas that have been relinquished for mining formalization processes.

Reserve Areas for Mining and Energetic Development.

These zones may be delimitated for a 2 year term, extendable for the same term.

The reserve areas for mining and energetic development will be granted by means of an objective selection process.

Classification of Mining

According to the National Development Plan the mining activities will be classified as subsistence mining, small, medium and large mining.

Financial Capacity

As per the National Development Plan in order to: (i) Grant mining concession contracts; (ii) assign mining titles; and (iii) assign areas, the applicants and the assignees shall be required to demonstrate their financial capacity for the exploration, exploitation, execution and development of the project.

Likewise, the titleholder must explain the financial reasons that support the extension of the exploration stage.

The National Development Plan established that the minutes of the mining concession contracts must include the obligation for the titleholder to prepare and carry out social management plans.

Extension of the Mining Concession Contract

The extension of the mining concession contract must be requested at least 2 years before the end of the exploitation period.

The National Development Plan determined that the mining authority could establish new conditions as a requisite to grant a time extension to the mining concession contract and to agree on different compensations other than the royalties.

This provision was challenged before the Constitutional Court on August 18, 2015.