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Uganda moots new law to streamline mining sector

The government of Uganda has commenced scrutinizing the Mining and Minerals Bill, 2021. Minister of State for Minerals, Peter Lokeris, led a team from the Ministry of Energy and Mineral Development to introduce the long awaited Bill to the Committee for scrutiny.

While presenting the Bill, Lokeris said the Mining and Minerals Bill, 2021 would repeal the Mining Act, 2003 which has become ‘inadequate’ and ‘obsolete’ in protecting and streamlining the mining sector in the country.

The Bill intends to cure the gaps unattended to by the current law [the Mining Act, 2003] by seeking to promote transparency of mining operations, organise, license, regulate and transform artisanal and small scale mining in Uganda and to create an enabling environment for attracting investments among others.

“Uganda is endowed with natural resources including valuable minerals such as copper, gold, iron ore and others, however, the sub sector continues to face challenges of low funding, institutional capacity to manage mineral resources, complex nature of artisanal and small scale mining, conflicts and environmental degradation despite the existing laws,” Lokeris said.

Acquisition of licenses

One of the clauses that the new Bill is introducing is the acquisition of licenses for building materials such as sand, murram, aggregate and clay, exploited for commercial purposes. Under Article 244 of the Constitution of the Republic of Uganda, building substances are not regarded as minerals but Parliament has the mandate to regulate the exploitation of such substances. According to the Minister, the new Bill will now require a person seeking to explore or mine or dispose of any building substance for commercial purposes to acquire a quarry license.

“These natural resources are for everybody but where these building substances are exploited for individual or domestic use, then you do not need to pay anything. But if a person is exploiting sand on a large scale then it should be treated as a commercial purpose because you are also selling it to other people and therefore, must be treated as a mineral and subsequently taxed,” Lokeris said.

The Bill among others seeks to introduce the production sharing agreement system, set up a National Mining Company to handle the State’s commercial interests in the mining subsector and establish the Mineral Protection Force within the Directorate of Geological Survey and Mines to protect minerals against malpractices and enforce compliance.

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