December 03, 2008

China to tighten mining royalty payment system

According to a notice jointly issued by Chinese ministry of finance and the ministry of land & resources, mine owners have to pay for their mining rights and local governments must turn in 20% of the proceeds to the national coffer.

According to the notice, land and resources management departments will strengthen supervision on payment of mining charges by installment in reform pilots and mines are required to pay off the installments before they pass certificate registration and annual inspection.

Paying for prospecting and mining rights in the form of capital will be the focus of the follow on reform. If the prospecting charges are less than CNY 5 million or the mining charges less than CNY 30 million, then the charges should be paid one-off.

As to the prospecting and mining rights that get registered certificates issued by related provincial governments, one off payment standards will be made by the respective provincial governments according to local conditions.