Article 55p. 55

NATURAL RESOURCES AND ENVIRONMENTAL LAWS STATUTES and IMPLEMENTING RULES AND REGULATIONS

communication facilities, processing plants which are

necessary

for

the

effective

implementation

of

the

People's

Small-scale

Mining

Program,

subject

to

payment of reasonable fees to the operator, claimowner,

landowner or lessor.

Section 12. Rights Under a People's Small-scale Mining

Contract.

–

A

people's

small-scale

mining

contract

entitles the small-scale mining contractor to the right to

mine, extract and dispose of mineral ores for commercial

purposes. In no case shall a small-scale mining contract

be subcontracted, assigned or otherwise transferred.

Section 13. Terms and Conditions of the Contract. – A

contract shall have a term of two (2) years, renewable

subject to verification by the Board for like periods as

long as the contractor complies with the provisions set

forth in this Act, and confers upon the contractor the

right to mine within the contract area: provided, that the

holder of a small-scale mining contract shall have the

following duties and obligations:

(a) Undertake mining activities only in accordance with a

mining plan duly approved by the Board;

(b) Abide by the Mines and Geosciences Bureau and the

small-scale Mining Safety Rules and Regulations;

(c) Comply with his obligations to the holder of an

existing mining right;

(d) Pay all taxes, royalties or government production

share as are now or may hereafter be provided by law;

(e) Comply with pertinent rules and regulations on

environmental protection and conservation, particularly

those on tree-cutting mineral-processing and pollution

control;

(f) File under oath at the end of each month a detailed

production and financial report to the Board; and

(g)

Assume

responsibility

for the safety of persons

working in the mines.

Section 14. Rights of Claimowners. – In case a site

declared and set aside as a people's-scale mining area is

covered by an existing mining right, the claimowner and

the small-scale miners therein are encouraged to enter

into a voluntary and acceptable contractual agreement

with respect to the small-scale utilization of the mineral

values

from

the

area

under

claim.

In

case

of

disagreement, the claimowner shall be entitled to the

following rights and privileges:

(a) Exemption from the performance of annual work

obligations and payment of occupation fees, rental, and

real property taxes;

(b) Subject to the approval of the Board, free access to

the

contract

area

to

conduct

metallurgical

tests,

explorations and other activities, provided such activities

do not unduly interfere with the operations of the

small-scale miners; and

(c) Royalty equivalent to one and one half percent (1 1/2%)

of the gross value of the metallic mineral output or one

percent

(1%) of the gross value of the nonmetallic

mineral output to be paid to the claimowner: provided,

that such rights and privileges shall be available only if

he is not delinquent and other performance of his

annual work obligations and other requirements for the

last two (2) years prior to the effectivity of this Act.

Section 15. Rights of Private Landowners. – The private

landowner or lawful possessor shall be notified of any

plan

or

petition

to

declare

his land as a people's

small-scale mining area. Said landowner may oppose

such plan or petition in an appropriate proceeding and

hearing conducted before the Board.

If a private land is declared as a people's small-scale

mining area, the owner and the small-scale mining

contractors are encouraged to enter into a voluntary and

acceptable contractual agreement for the small-scale

utilization of the mineral values from the private land:

provided, that the owner shall in all cases be entitled to

the payment of actual damages which he may suffer as

a

result of such declaration: provided, further, that

royalties paid to the owner shall in no case exceed one

percent (1%) of the gross value of the minerals recovered

as royalty.

Section 16. Ownership of Milllings. – The small-scale

mining contractor shall be the owner of all milllings

produced from the contract area. He may sell thelings or

have them processed in any custom mill in the area:

provided,

that,

if

the small-scale mining contractor

decide to sell its milllings, the claimowner shall have a

preemptive

right

to

purchase

said milllings at the

prevailing market price.

Section

17.

Sale

of

Gold.

–

All

gold

produced

by

small-scale miners in any mineral area shall be sold to

the Central Bank, or its duly authorized representatives,

which shall buy it at prices competitive with those

prevailing in the world market regardless of volume or

weight.

The Central Bank shall establish as many buying stations

in gold-rush areas to fully service the requirements of

the small-scale minerals thereat.

Section

18.

Custom

Mills.

– The establishment and

operation of safe and efficient customs mills to process

minerals or ore-bearing materials shall be limited to

mineral processing zones duly designated by the local

government unit concerned upon recommendation of

the Board.

In mining areas where the private sector is unable to

establish custom mills, the Government shall construct

such custom mills upon the recommendation of the

Board based on the viability of the project.

The Board shall issue licenses for the operation of

custom mills and other processing plants subject to

pollution control and safety standards.

The Department shall establish assay laboratories to

cross-check the integrity of custom mills and to render

metallurgical and laboratory services to mines.

Custom mills shall be constituted as withholding agents

for the royalties, production share or other taxes due the

Government.

Section 19. Government Share and Allotment. – The

revenue to be derived by the Government from the

operation of the mining program herein established

shall be subject to the sharing provided in the Local

Government Code.

Section 20. People's Small-scale Mining Protection Fund.

– There is hereby created a People's Small-scale Mining

Protection Fund which shall be fifteen percent (15%) of

the national government's share due the Government

which

shall

be

used

primarily

for

information

dissemination and training of small-scale miners on

safety, health and environmental protection, and the

establishment

of

mine

rescue

and

recovery

teams

including

the

procurement

of

rescue

equipment

necessary in cases of emergencies such as landslides,

tunnel collapse, or the like.

© 2018 Compiled by RGL

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