By Marcel Chimwala
The Malawi Government has printed the long awaited Revised Mines and Minerals Act, which is currently being distributed to stakeholders by the Government Print Offices in Lilongwe at a fee of K10,000.
The Mines and Minerals Bill was passed into an Act on December 14, 2018, assented to by State President Arthur Peter Mutharika on January 25, and gazetted on February 15, 2019.
The objectives of the new Act are to regulate the development of the mineral resources of Malawi through adherence to sustainable development principles, and ensure that the mineral resources benefit the economy and promote the economic growth of Malawi, protect and improve the welfare of the present and future citizens of Malawi, and provide an attractive and conducive environment for investment in the mining sector.
They also include to minimize or prevent economic declines related to decreased mining activity by creating through training and other means of a foundation for the future, social economic empowerment, uplifting and development of local communities, and regions affected by mining, and manage environmental impacts for the management of all present and future generations of Malawi.
“The entire property in minerals in, under or upon any land or waters in Malawi are vested in the Republic; but without prejudice to the exercise of any right under or pursuant to this Act,” reads the new Law.
The Law puts the overall administration of the minerals sector in the hands of the Mineral Resources Committee which shall consists of the Commissioner for Mines, Secretaries responsible for Mines, Local Government, Water, Lands, Treasury, Environmental Affairs and the Directors for Geological Survey, Parks and Wildlife, Forestry, Inspector General of Police and Solicitor General, or their representatives.
“The Minister shall not grant an exploration license, retention license, medium scale mining license or large scale mining license unless the Mineral Resources Committee has recommended the respective application, and any grant of a license that contravenes this subsection shall be null and void,” reads the Act.
The new law entitles the government to acquire a free equity of up to 10% in any mining project that will be subject to a large scale mining license.
It says any company that is a large-scale mining license holder and has provided free equity ownership interest to government shall have on its management committee or board, as the case maybe, a committee or board member nominated by the Minister responsible for Mines.
“The government as the holder of the free equity ownership interest derived under this section is not responsible for meeting the past, present or future exploration, development, operating, reclamation or any other costs of the project to which the free equity ownership interest relates,” the Act reads.
The new Act has also a provision for a mining company to develop a community engagement plan in collaboration with local government authorities, traditional leaders, communities, civil society organisations, women and minority groups in the area in proximity to the tenement.
The Act reads: “The Commissioner may suspend the operations of the holder of an exploration license, retention license, medium scale mining license or large scale mining license on its tenement area when the holder thereof has failed to have its community engagement plan or updated plan registered or has substantially failed to implement its community development plan.”
“Such suspension shall have effect until such time as the Commissioner is satisfied that the holder of the license has remedied the reason for which the license was suspended.”
The new Act, which has provisions to regulate trade in reserved minerals including gold, silver and precious stones, is viewed as a tool for the Malawi Government to address illegal mining of precious minerals which has been rampant across the country notably in Makanjira in Mangochi, Nanthenje and Lundu in Lilongwe, Kasungu, Mzimba nd Chitipa.
The Act says any person shall not possess any reserved mineral in its raw state unless the possessor is a holder of a mineral tenement and the reserved mineral was extracted from, or on its license area; a reserved mineral license holder or is an authorized agent acting on that license holder’s behalf; or a person who has acquired the reserved mineral from a holder of a reserved mineral license.
“A person shall not purchase in Malawi any reserved mineral in its raw state unless the purchaser has a reserved mineral license or is an authorized agent of such license holders, or purchased the reserved mineral from a holder of a reserved minerals license,” it reads.