There have been significant changes to the mining- legal regime in Tanzania.
The Mining (Local Content) Regulations, 2018 which were included in the Written Laws (Miscellaneous Amendments) Act No. 7 of 2017:
- These Regulations were enacted following the Amendments of the Mining Act, 2010.
- These Regulations have to be followed by contractors in order to ensure that local content rules are adhered to all persons or companies involved in the mining industry.
- A Committee has been established so as to oversee the implementation of these Regulations in the mining industry in Tanzania.
- These Regulations clearly state that priority has to be given to qualified Tanzanians in employment and on job training.
- Further, these Regulations provide that preference has to be given to local service providers and goods which are manufactured locally.
- Companies which will be given first preference in the grant of mining license are indigenous Tanzanian companies.
- These Regulations also provide that legal services have to be provided only by local legal practitioners or local law firms.
- Insurance and financial services used by these companies should be local ones only.
- The Mining (Local Content) Regulations, 2018 provide that Tanzanian companies which are indigenous must hold an equity participation of at least 20% in mandatory joint venture arrangements for supply of goods and services which will be required.
- Further, indigenousTanzania companies are required to have at least 5% equity participation in a mining company.
- Lastly, the Regulations provide that failure to comply with the Regulations attracts cumbersome criminal and administrative sanctions and fines up to US$ 5 Million.
Mining (Mineral Rights) Regulations, 2018:
- These Regulations which replace the Mining (Mineral Rights) Regulations, 2010 were published in January, 2018 under GN. No. 1 of 2018.
- These Regulations provide that Application for mineral right has to be made to the Mining Commission through a prescribed form.
- The maximum size of each mining area is provided in the Regulations.
- These Regulations also provide for a minimum expenditure for holders of prospecting license.
- Further, the Regulations require that every area of land which is subject to a mineral right has to be secured and demarcated by erecting a post that shall be placed in the ground at each corner of the relevant area.
- The Regulations also impose an obligation to holders of prospecting mining license to keep full and proper accounts of all expenditure incurred along with the required receipts.
To ensure compliance with these new legislative provisions, every mineral right holder must prepare and submit to the Mining Commission a procurement plan indicating the proposed use of services, works, goods and services in Tanzania. The procurement plan must be for a period of at least 5 years.
Within sixty days of the end of each calendar year, every mineral right holder must submit to the Mining Commission a report detailing its achievements in utilizing Tanzanian goods and services during that calendar year.