CSO comments on the new Mining Bill 2010

 Policy Forum, together with other Civil Society Organisations and mining interest groups prepared and submitted analysis of the new Mining Bill of 2010 to the Parliamentary Energy and Minerals Committee at the Public Hearing on Sunday the 18th of April 2010 in Dodoma. In a nutshell, and according to our scrutiny, the new bill does not go far enough to meet the recommendations of the presidential Bomani Commission that reviewed the mining sector two years ago. Below are a few pointers which build upon the comments we made earlier before the Bill became publicly available:

1. The new law gives the Minister for energy and minerals and the commissioner of minerals excessive powers over the proposed Minerals Advisory Board. Under the new law, the Advisory Board is still limited in its independence. The Bomani Commission proposed that the advisory committee be abolished and in its place an independent authority with oversight functions in the mining sector be created.

2. There is also absence of fairness during dispute settlements and the lack of due process in the new proposed legislation. The Minerals Commissioner will have regulatory functions as well as powers for dispute settlement. This new law proposes that the Commissioner assume quasi-judicial powers but we are not sure of their suitability and qualification. Also, the bill places an assumption that the commissioner will consistently act in good faith.

3. With respect to royalties, we note that although the Mining Bill provides for a 50% penalty in the case of a failure to pay royalties or taxes owed, there is no mention of interest being accrued where failures persist. Because the proposed law has no interest provision, there is a possibility that once the penalty has been assessed, there will be no further financial penalty to push for payment. An initial penalty with interest would result in an increasing inducement to pay.

4. On issues of land compensation, the proposed law provides that the Land Act and the Village Land Act apply in setting compensation rates. The application of the Land Acquisition Act will deny land occupiers fair compensation as this law does not take into consideration the market value of the land after it is determined to have mineral resource. Moreover, the law is very vague in its criteria for compensation. We also noted that it would be appropriate if the law provided for landowners to receive some support from the Government in any negotiations they must undertake with regard to compensation.

5. On environmental and social Issues, we note that although the bill requires the filing of an environmental management plan in an application for a special mining license, and special license holders are obligated to adhere to it, the proposed legislation is not clear with respect to the extent of the participatory process that is to be undertaken prior to the commencement of mining activity. We propose that the law provide for consultation with affected communities when Environmental and Social Impact Assessments are being undertaken.

6. We see that the new bill does not provide for transparency as it classifies different types of information such as mining companies’ books of account which may relate to payments or values of minerals produced as ‘confidential’. The bill is also vague with regards to transparency in the tendering process. Because Tanzania is a candidate country to be included in the Extractive Industries Transparency Initiative (EITI), the new law should have included a specific reference to this. Tanzania made clear its commitment to transparency in the mining sector when applying to join the EITI, the new law should similarly allude to this obligation. Also for reference, see attached analysis matrix and the Mining Bill below: