Philippine Mining Sector Reforms

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Questions and Answers

What is the current excise tax on coal per metric ton?

P100 per metric ton

P50 per metric ton

P10 per metric ton (correct)

P150 per metric ton

What percentage of the total revenue from TRAIN will go to social mitigating measures?

40%

30% (correct)

20%

50%

What is the main objective of EO 130 of 2021?

Lifting the moratorium on mineral agreements under Section 4 of EO 79 (correct)

Establishing a new mining tax rate

Amending the TRAIN Law to increase excise tax on minerals

Prohibiting the use of mercury in small-scale mining

What is the main objective of Sec 11 of EO 79 of 2012?

To improve and address issues on small-scale mining Signup and view all the answers

What is the total mining contribution to the total Philippine revenue of Php1900 billion?

1% (Php12.9 billion) Signup and view all the answers

What is the minimum period for the operationalization of P/CMRBs in provinces and cities where they have not been constituted?

3 months Signup and view all the answers

What is the new mining tax rate under the TRAIN Law?

4% on metallic and non-metallic Signup and view all the answers

What is the main objective of fast-tracking the release and access of LGUs to their share from mining revenues?

To support the development of local communities Signup and view all the answers

What is the main objective of updating the mineral commodity profile and database?

To improve the accuracy of mining data and statistics Signup and view all the answers

What is the primary purpose of EO 79 of 2012?

To implement reforms in the Philippine mining sector and ensure environmental protection Signup and view all the answers

What is the main objective of conducting a study on existing mechanisms for benefit sharing and reviewing existing taxes and fees?

To identify opportunities for improving the benefit sharing mechanism Signup and view all the answers

What type of areas are closed to mining according to Section 1 of EO 79 of 2012?

Areas under Sec. 19 of RA 7942, protected areas, and prime agricultural lands Signup and view all the answers

Who is responsible for ensuring environmental standards in mining are fully enforced?

The DENR and LGUs Signup and view all the answers

What is the purpose of the review of existing mining operations led by the DENR?

To evaluate the performance of existing mining operations Signup and view all the answers

What is the status of new mineral agreements under Section 4 of EO 79 of 2012?

They are suspended until legislative reforms are implemented Signup and view all the answers

What is the purpose of declaring certain areas as Mineral Reservations?

To identify areas with known mineral resources for future development Signup and view all the answers

Who has the right of first option for mining rights in areas with known mineral resources?

Grantees of exploration permits Signup and view all the answers

Who is responsible for preparing competitive public bidding for mining rights?

The MGB Signup and view all the answers

What is the status of valuable metals in abandoned ores and mine wastes?

They are owned by the State and subject to competitive public bidding Signup and view all the answers

What is the purpose of the Mining Industry Coordinating Council (MICC)?

To coordinate mining policies and ensure environmental sustainability Signup and view all the answers

Study Notes

Executive Order 79 of 2012

Implements reforms in the Philippine mining sector to ensure environmental protection
Provides policies and guidelines to ensure environmental protection

Areas Closed to Mining

Areas under Section 19 of RA 7942
Protected areas under NIPAS
Prime agricultural lands, fisheries development zones, and fish refuge and sanctuaries
Tourism development areas
Other critical areas

Environmental Standards

The government and DENR, with the LGUs, shall ensure environmental standards in mining are fully and strictly enforced
Only those who comply with all requirements are eligible for the grant of mining rights

Review of Existing Mining Operations

A multi-stakeholder team led by the DENR shall conduct a review of the performance of existing mining operations

New Mineral Agreements

No new mineral agreements shall be entered into until legislation rationalizing existing revenue sharing schemes and mechanisms have taken effect
DENR may continue to grant Exploration Permits
Grantees of exploration permit have the right of first option

Mineral Reservations

Potential and future mining areas with known mineral resources shall be declared as Mineral Reservations
Identified in the Philippine Development Plan and a National Industrialization Plan
"National Government Owned Mining Assets" - mining areas/tenements previously held by operators

Grant of Mining Rights

The grant of mining rights and mining tenements over areas with known mineral resources shall be undertaken through competitive public bidding prepared by the MGB

Abandoned Ores and Mine Wastes

All valuable metals in abandoned ores and mine wastes and/or mill tailings generated by previous/defunct mining operations belong to the State
Shall be developed and utilized through competitive public bidding

Mining Industry Coordinating Council (MICC)

Co-chaired by chairpersons from two clusters
Members:
- Secretary
- Department of Justice
- Chairperson, NCIP
- President, ULAP (Union of Local Authorities of Philippines)
Functions:
- Demand operational and financial reports from both large and small-scale miners
- Conduct verification of taxes and fees at the national, regional, and local levels
- Fast-track release and access of LGUs to their share from mining revenues
- Update mineral commodity profile and database
- Conduct a study on existing mechanisms for benefit sharing and review of existing taxes, fees
- Study the terms and conditions of service contracts entered by DOE
- Study the imposition of higher export fees
- Consider tapping 3rd party international auditors to validate the volume and value of mineral exports
- Increase mine wastes and tailings and occupation fees (DENR)
- Provide benchmarks for the valuation of minerals (DENR)
- Prepare and maintain revenue baseline data (BIR)

Executive Order 130 of 2021

Amends Section 4 of EO 79, 2012
Lifts the moratorium on mineral agreements
The government may enter into new mineral agreements, subject to compliance with the Philippine Mining Act of 1995 and other applicable laws

Mining Tax Reforms

Increase in Excise Tax from 2% to 4%
Coal Excise Tax: P10 per metric ton (current), P50 per metric ton (1st yr), P100 per metric ton (2nd yr), P150 per metric ton (3rd and succeeding years)
Petroleum Excise Tax:
- Liquefied, Diesel: None (current), P3 per kg (2020 onwards)
- Premium Gasoline: P4.35 per liter (current), P10 per liter (2020 onwards)

Revenue Allocation

70% of revenue from TRAIN will go to:
- Infrastructure and new road networks
- Military
- Drinking Supply
30% of revenue from TRAIN will go to:
- Social mitigating measures: Education, health, nutrition, and anti-hunger programs

Small-Scale Mining

Comply with RA 7076 or People's Small-Scale Mining Act of 1991
Comply with the EIS requirements under PD 1586
Operate only within the declared Minahang Bayan
Pursuant to Section 24 of RA No. 7076, P/CMRBs in provinces and cities shall be operationalized within three (3) months from the effectivity
Not applicable for metallic minerals except gold, silver, and chromite
Use of mercury in small-scale mining shall be strictly prohibited
Training and capacity building measures in the form of technical assistance for small-scale mining cooperatives and associations shall be conducted by concerned government agencies

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Description

This quiz covers the implementation of reforms in the Philippine mining sector, including policies and guidelines for environmental protection. It specifically deals with areas closed to mining and the enforcement of environmental standards.