Amendments to the Peruvian Mining Law
- Production penalty and cancellation of mining concessions:
On 5 January 2017, Legislative Decree No. 1320, which amends Articles 40 and 41 of the Peruvian Mining Law, was published in the El Peruano official gazette. These Articles rule: (i) the obligation of the titleholders of mining concessions to pay a penalty for not reaching the annual minimum production levels of minerals set forth by Peruvian law; and (ii) the cancellation of mining concessions for not achieving minimum production levels. The key aspects of these amendments are:
- Legislative Decree No. 1320 will come into force on 1 January 2019.
- The term granted to the titleholders of mining concessions for reaching minimum production has been extended to 30 years. In other words, mining concessions will be cancelled if minimum production is not reached by the thirtieth year following the year in which the relevant mining concession was granted.
- Titleholders of mining concessions shall pay the production penalty as from the eleventh year following the year in which the mining concession was granted.
- The penalty will vary. Initially, it will be 2% of the minimum production. If the minimum production is not reached by the fifteenth year from the year following that in which the mining concession was granted, the penalty fee will be 5% of the minimum production. If the minimum production is not reached by the twentieth year, the penalty will be 10% of the minimum production.
- Titleholders of mining concessions shall be exempted from paying the penalty if they invest, at least, an amount equivalent to 10 times the relevant penalty.
- Administrative regulations of Legislative Decree No. 1320 should be enacted within 180 days from 6 January 2017.
- Terms calculation:
- On 21 December 2016, Legislative Decree No. 2744 –“Legislative Decree amending Law No. 2744, Law on the General Administrative Procedure, and repealing Law No. 29060, Law on Administrative Silence”– was published.
- In addition to other important changes introduced to the rules generally governing all administrative procedures, this Legislative Decree has repealed Article 161 of the Peruvian Mining Law, which established that legal terms stemming from notices served by the mining authorities, started running as from the sixth day following the date in which the notice was dispatched by mail. Now these terms will start running as from the first business day following the day in which the notice is actually delivered.
The Natural Resources and Environmental Practice team of Rodrigo, Elías & Medrano Abogados remains at your service should you have any doubts or need to make a query with respect to the matters hereof.