On May 9, 2024, Supreme Decree No. 10 was approved, which modifies the Regulations of the Mining Code to adapt it to the latest legal changes.
These modifications correspond to Law No. 21,649, published in the Official Gazette on December 30, 2023, introducing changes to the Mining Code, the Constitutional Organic Law on Mining Concessions and the Law that creates the National Geology and Mining Service (SERNAGEOMIN).
Likewise, Supreme Decree No. 9 of the Ministry of Mining was approved, which establishes the new regulations that regulate the obligation to deliver geological information.
The main changes introduced to the mining legal and regulatory framework are summarised below”
A) Amount of annual mining licenses
The difference between metallic and non-metallic concessions is eliminated, increasing the value of non-metallic mining patents in accordance with the standards reviewed below:
Exploration patents increase their amount from 1/50 to 3/50 of the Monthly Tax Unit (UTM) per hectare.
Regarding exploitation concessions for the year 2024, 1/10 of UTM per hectare will continue to be paid exceptionally for exploitation concessions. From now on, if the mining properties do not fall within the scenarios provided by law, they will be subject to a progressive increase from 4/10 of UTM per hectare during the first five years since they are not considered in the assumptions of the law for the reduced patent, up to 12 UTM per hectare from the thirty-first year.
The law establishes the following hypotheses of reduced patent (1/10 UTM per hectare):
Effective work in the concession: The performance of mining work, having to prove annually that work, activities or works have been started that permanently and continuously allow the development of mining operations, understood as those referred to in Law No. 20,551. That Regulates the Closure of Mining Sites and Facilities (Site Closure Law), including those that derive from compliance with a mining site closure plan. The consideration for such operations will apply regardless of whether they are carried out on owned or leased property.
B) Duration of exploration concessions
Exploration concessions will be valid for 4 years, renewable for up to 4 more years if some requirements for the delivery of geological information or processing before the SEIA are met.
For this, the mining concessionaire must, within the first six months of the last year of its concession, present to SERNAGEOMIN a report with all the geological information obtained in the exploration works that have been carried out during the validity of its concession, and must comply with Supreme Decree No. 9 of 2024 of the Ministry of Mining or the regulation that replaces it.
Alternatively, the holder may present to SERNAGEOMIN the documentation that accredits the obtaining of an RCA with respect to his mining project in the period of duration of the concession, or the admission of his project for processing in the SEIA.
Furthermore, once the exploration concession has expired, a one-year prohibition is established on the original exploration concessionaire and its related persons from reacquiring exploration concessions in the area of the expired exploration concession.
C) Limitation on the exercise of possessory actions
There is a change in the exercise of possessory actions in the sense of requiring the mining concessionaire, who exercises a possessory action (such as the complaint of new construction, for example) against the owner, possessor or mere holder of the surface properties, to prove that he is holder of an easement right or other real right over said surface property.
Likewise, it is established that it is optional for the judge to decree the suspension or stoppage of the reported works, and the concessionaire must prove that he is the holder of a real right and provide background information that justifies the serious and imminent danger that the non-granting of the suspension or stoppage entails. . Furthermore, if the cessation of the works is decreed, the owner may cause their effects to cease by providing sufficient security to allow them to respond for their demolition or compensation for damages.
This represents a radical change in the protection of assets and critical infrastructure of projects, and the maintenance of much mining property that was only maintained for reasons of security of non-mining assets must be re-evaluated.
D) Delivery of geological information
A change is introduced in the delivery of geological information, specifying delivery times and increasing the fine for non-delivery to 100 UTA, which may be doubled if said information is required by SERNAGEOMIN, also disabling the mining concessionaire from obtaining the benefit of a reduced patent.
Along with the above, the exploration concessionaire must submit a report with all the geological information obtained in the exploration work that has been carried out during the validity of its concession before requesting the renewal of its concession for another 4 years.
Regarding the exploitation concessionaire, it must send to SERNAGEOMIN every two years a report with all the geological information obtained from the geological exploration work carried out during said period.
The detail of the geological information to be delivered is contained in the new regulation that regulates the obligation to deliver geological information contained in Supreme Decree No. 9 of 2024 of the Ministry of Mining.
The report with the geological information must be presented through a form that SERNAGEOMIN will have for these purposes on its website.
The background information that must be accompanied and its delivery format are established, which include a presentation of the project, georeferenced geological maps, geophysical surveys, geochemical surveys, drilling information, and others. The geological information received by SERNAGEOMIN will continue to be the property of the reporting company but will be public information in accordance with the provisions of Law No. 20,285 on Access to Public Information (the reporting company may request that said information be considered confidential for up to 4 years).