mining in the philippines

7/27/2019 Mining in the Philippines

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Bohol

Mateo

Natural Resources Law

GO3


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1987 Constitution

Republic Act 7942

Republic Act 7076

IPRA Law


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all lands of the public domain

water, minerals, coal, petroleum and other mineraloils

all forces of potential energy, fisheries, forests or

timber, wildlife, flora and other natural resources

owned by the state.

exploration, development and utilization of these

natural resources under the full control and supervision

of the state. States option-entering into co-production, joint

venture or production-sharing agreements with

Philippine citizens or Philippine corporations or

associations.


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At least 60% of the capital of acorporation or association-owned byPhilippine citizens to be considered as aPhilippine corporation or association.

Exception- President of the Philippinescan enter into agreements with foreign-owned corporations involving eitherfinancial or technical assistance, for thelarge-scale exploration, development andutilization of minerals, petroleum andother mineral oils.


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Regalian Doctrine-State owns all natural

resources.

Ownership of Private Lands-Only Filipinocitizens and corporations 60% Filipino owned

may acquire private lands.


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Philippine Mining Act of 1995

Effectivity- March 3, 1995

An Act Instituting a New System of Mineral

Resources Exploration, Development,

Utilization and Conservation


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Owned by the State

Exploration, development, utilization and

processing thereof shall be under States full

control and supervision. State may directly undertake activities or

enter mineral agreements with contractors

Rights indigenous people shall be recognized


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Can be allowed for scientific, cultural or

ecological value

President upon the Directorsrecommendation through the Secretary

Mining operations in existing mineral

reservations shall be undertaken by theDepartment or through a contractor- 25% of

such mineral reservation shall be subject to

valid exiting mining quarrying rights


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All submerged lands within the contiguous zoneand exclusive economic zone in RP are mineralreservations

10% share of all royalties and revenues to be

derived by the government from thedevelopment and utilization of the mineralresources within mineral reservations shallacrrue to Mines and Geosciences Bureau

Mining operations in reserved lands other thanmineral reservations may be undertaken by theDepartment or qualified person in accordancewith the rules and regulations promulgated bythe Secretary.


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right to develop and utilize minerals shall be

awarded to the President through

recommendation by the Director and

approval of the Secretary- party whoundertook exploration shall be given priority.

mineral land to be awarded shall be

automatically excluded-right of lessee of avalid mining contract shall not be prejudiced

or impaired


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Secretary shall periodically review


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Department shall be the primary government

agency responsible for the conservation,

management, development and proper use of

the States mineral resources

Bureau shall have direct charge in the

administration and disposition of mineral

lands and mineral resources and shallundertake geological, mining, metallurgical,

chemical and other researches as well as

geological and mineral exploration surveys


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No ancestral land shall be opened for mining

operations without prior consent of the

indigenous cultural community concerned

Royalty payments shall also be agreed upon

and shall for part of a trust fund for the

socioeconomic well-being of the indigenous

cultural community


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military and other government reservations,

except upon prior written clearance by the

government agency concerned

near or under public or private buildings,

cemeteries, archeological and historic sites,

bridges, highways, waterways, railroads,

reservoirs, dams or other infrastructure projects,

public or private works including plantations or

valuable crops, except upon written consent ofthe government agency or private entity

concerned

areas covered by valid and existing mining rights

areas expressedly prohibited by law


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In areas covered by small-scale miners as defined by lawunless with prior consent of the small-scale miners, in

which case a royalty payment upon the utilization of

minerals shall be agreed upon by the parties, said royalty

forming a trust fund for the socioeconomic development

of the community concerned

Old growth or virgin forests, proclaimed watershed forest

reserves, wilderness areas, mangrove forests, mossy

forests, national parks, provincial/municipal forests,

parks, greenbelts, game refuge and bird sanctuaries as

defined by law in areas expressly prohibited under the

National Integrated Protected areas System (NIPAS) under

Republic Act No. 7586, Department Administrative Order

No. 25, series of 1992 and other laws.


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Mining Geosciences Bureau (MGB) shall have the

authority

Maximum areas shall be:

Onshore, in any one province (1) For individuals, twenty (20) blocks; and

(2) For partnerships, corporations, cooperatives, or

associations, two hundred (200) blocks

Onshore, in the entire Philippines (1) For individuals, forty (40) blocks; and

(2) For partnerships, corporations, cooperatives, or

associations, four hundred (400) blocks.


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Onshore, beyond five hundred meters (500m)

from the mean low tide level

(1) For individuals, one hundred (100) blocks;

and

(2) For partnerships, corporations,

cooperatives, or associations, one thousand

(1,000) blocks.


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Mineral production sharing agreement - is an agreementwhere the Government grants to the contractor the

exclusive right to conduct mining operations within acontract area and shares in the gross output. The

contractor shall provide the financing, technology,

management and personnel necessary for the

implementation of this agreement. Co-production agreement - is an agreement between the

Government and the contractor wherein the Government

shall provide inputs to the mining operations other than the

mineral resource

Joint venture agreement - is an agreement where a joint-venture company is organized by the Government and the

contractor with both parties having equity shares. Aside

from earnings in equity, the Government shall be entitled

to a share in the gross output.


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Maximum Contract Area. The maximum

contract area that may be granted per

qualified person, subject to relinquishment

shall be:

(a) 1,000 meridional blocks onshore;

(b) 4,000 meridional blocks offshore; or

(c) Combinations of (a) and (b) provided that it

shall not exceed the maximum limits foronshore and offshore areas.


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Provincial governor shall grant permit

5 years-25 years


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Provincial Mining Regulatory Board shall

formulate own policies

Mining Rights: Timber and water rights;

subject to taxes excise taxes on mineralproducts


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Late or non-filing of requirements

Violation of terms and conditions of permits

or agreements

Non-payment of taxes and fees Suspension or cancellation of tax incentives

and credits

Falsehood or omission of facts in the

statement


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Violation Description Penalty

False Statements Presents any false application,

declaration or evidence to

Government

Not exceeding P10000 fine

Illegal Exploration Undertaking exploration work

without necessary permit

Fine of not exceeding P50000

Theft of Minerals Extracting minerals and

disposing the same without amining agreement, lease,

permit, license

Steals minerals or ores or the

products thereof from mines or

mills or processing plants

Imprisonment of 6 months to 6

six years or fine from P10000to P20000 or both

Pay damages and

compensation for the minerals

removed, extracted and

disposed of

Destruction of Mining

Structures

Willfully destroys or damages

structures in or on the mining

area or on the mill sites

Not to exceed 5 years

imprisonment

Pay compensation for damages

Mines Arson Willfully sets fire to any mineral

stockpile, mine or workings,

fittings or a mine

Convicted based on RPC and

pay compensation for the

damages caused thereby


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Violation Description Penalty

Willful Damage to a Mine Any person who willfully damages a

mine, unlawfully causes water to run

into a mine, or obstructs any shaft or

passage to a mine, or renders useless,

damages or destroys any machine,

appliance, apparatus; rope, chain,tackle, or any other things used in a

mine,

Not exceed 5 years imprisonment and

pay compensation for damages

caused thereby

Illegal Obstruction to Permittees or

Contractors

Any person who, without justifiable

cause, prevents or obstructs the

holder of any permit, agreement or

lease from undertaking his mining

operations shall be punished,

fine not exceeding Five thousand

pesos (P5,000.00) or imprisonment

not exceeding one (1) year, or both, at

the discretion of the court.

Violation of the Terms and Conditionsof the Environmental Compliance

Certificate

Any person who willfully violates orgrossly neglects to abide by the terms

and conditions of the environmental

compliance certificate issued to said

person and which causes

environmental damage through

pollution

Imprisonment of six (6) months to six(6) years or a fine of Fifty thousand

pesos (P50,000.00) to Two Hundered

Thousand Pesos (P200,000.00), or

both at the discretion of the court.

Illegal Obstruction to Government Officials Any person who illegally

prevents or obstructs the Secretary,

the Director or any of their

representatives in the performance of

their duties under the provisions of

this Act and of the regulations

promulgated hereunder

fine not exceeding Five thousand

pesos (P5,000.00) or by imprisonment

not exceeding one (1) year, or both, at

the discretion of the court.

Other Violations Any other violation of this Act and its

implementing rules and regulations

fine not exceeding five thousand

pesos (P5,000.00).


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Peoples Small Scale Mining of 1991

Effectivity- June 27, 1991

Subject: An Act Creating a Peoples Small-Scale Mining Program and For Other Purposes


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(a) The identification, segregation andreservation of certain mineral lands as people'ssmall-scale mining areas;

(b) The recognition of prior existing rights andproductivity

(c) The encouragement of the formation of

cooperatives;

(d) The extension of technical and financialassistance, and other social services;


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(e) The extension of assistance in processing andmarketing;

(f) The generation of ancillary livelihood

activities;

(g) The regulation of the small-scale miningindustry with the view to encourage growth and

productivity; and

(h) The efficient collection of governmentrevenue.


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Public lands not subject to any existing right;

Public lands covered by existing mining rights

which are not active mining areas; and

Private lands, subject to certain rights andconditions, except those with substantial

improvements or in bona fide and regular use as

a yard, stockyard, garden, plant nursery,

plantation, cemetery or burial site, or land

situated within one hundred meters (100 m.)from such cemetery or burial site, water

reservoir or a separate parcel of land with an

area of ten thousand square meters (10,000 sq.

m.) or less.


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No ancestral land may be declared as a people's

small-scale mining area without the prior

consent of the cultural communities concerned:

provided, that, if ancestral lands are declared as

people's small-scale mining areas, the membersof the cultural communities therein shall be

given priority in the awarding of small-scale

mining contracts.


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All persons undertaking small-scale mining

activities shall register as miners with the

Board and may organize themselves into

cooperatives in order to qualify for the

awarding of a people's small-scale mining

contract.


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The Board shall determine the reasonable size and shape

of the contract area following the meridional block systemestablished under Presidential Decree No. 463, as

amended, otherwise known as the Mineral Resources

Development Decree of 1974, but in no case shall the area

exceed twenty hectares (20 has.) per contractor and the

depth or length of the tunnel or adit not exceeding that

recommended by the director taking into account the

following circumstances:

(a) Size of membership and capitalization of the cooperative;

(b) Size of mineralized area;(c) Quantity of mineral deposits;

(d) Safety of miners;

(e) Environmental impact and other considerations; and

(f) Other related circumstances.


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A people's small-scale mining contract may be awarded

by the Board to small-scale miners who have voluntarily

organized and have duly registered with the appropriate

government agency as an individual miner or

cooperative; Provided, that only one (1) people's small-scale mining contract may be awarded at any one time

to a small-scale mining operations within one (1) year

from the date of award: provided, further, that priority

shall be given or city where the small-scale mining areais located.

Applications for a contract shall be subject to a

reasonable fee to be paid to the Department of

Environment and Natural Resources regional office

having jurisdiction over the area.


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A people's small-scale mining contract

entitles the small-scale mining contractor to

the right to mine, extract and dispose of

mineral ores for commercial purposes. In no

case shall a small-scale mining contract be

subcontracted, assigned or otherwise

transferred.


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A contract shall have a term of two (2) years, renewable

subject to verification by the Board for like periods as

long as the contractor complies with the provisions set

forth in this Act, and confers upon the contractor the

right to mine within the contract area: provided, that

the holder of a small-scale mining contract shall havethe following duties and obligations:

(a) Undertake mining activities only in accordance with a

mining plan duly approved by the Board;

(b) Abide by the Mines and Geosciences Bureau and thesmall-scale Mining Safety Rules and Regulations;

(c) Comply with his obligations to the holder of an

existing mining right;


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(d) Pay all taxes, royalties or governmentproduction share as are now or mayhereafter be provided by law;

(e) Comply with pertinent rules and regulations

on environmental protection andconservation, particularly those on tree-cutting mineral-processing and pollutioncontrol;

(f) File under oath at the end of each month a

detailed production and financial report tothe Board; and(g) Assume responsibility for the safety of

persons working in the mines.


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Exemption from the performance of annual work

obligations and payment of occupation fees, rental,and real property taxes;

Subject to the approval of the Board, free access to

the contract area to conduct metallurgical tests,explorations and other activities, provided such

activities do not unduly interfere with the

operations of the small-scale miners; and


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Royalty equivalent to one and one half percent

(1 1/2%) of the gross value of the metallic

mineral output or one percent (1%) of the gross

value of the nonmetallic mineral output to be

paid to the claim owner: provided, that suchrights and privileges shall be available only if he

is not delinquent and other performance of his

annual work obligations and other requirements

for the last two (2) years prior to the effectivityof this Act.


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The private landowner or lawful possessor shall be

notified of any plan or petition to declare his land asa people's small-scale mining area. Said landownermay oppose such plan or petition in an appropriateproceeding and hearing conducted before the Board.

If a private land is declared as a people's small-scalemining area, the owner and the small-scale miningcontractors are encouraged to enter into a voluntaryand acceptable contractual agreement for the small-scale utilization of the mineral values from the

private land: provided, that the owner shall in allcases be entitled to the payment of actual damageswhich he may suffer as a result of such declaration:provided, further, that royalties paid to the ownershall in no case exceed one percent (1%) of the gross

value of the minerals recovered as royalty.


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The small-scale mining contractor shall be

the owner of all milllings produced from the

contract area. He may sell thelings or have

them processed in any custom mill in the

area: provided, that, if the small-scale

mining contractor decide to sell its milllings,

the claimowner shall have a preemptive right

to purchase said milllings at the prevailing

market price.


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All gold produced by small-scale miners in

any mineral area shall be sold to the Central

Bank, or its duly authorized representatives,

which shall buy it at prices competitive with

those prevailing in the world market

regardless of volume or weight.

The Central Bank shall establish as many

buying stations in gold-rush areas to fullyservice the requirements of the small-scale

minerals thereat.


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The establishment and operation of safe and

efficient customs mills to process minerals or ore-bearing materials shall be limited to mineral

processing zones duly designated by the local

government unit concerned upon recommendation

of the Board. In mining areas where the private sector is unable

to establish custom mills, the Government shall

construct such custom mills upon the

recommendation of the Board based on the viability

of the project.


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The Board shall issue licenses for theoperation of custom mills and otherprocessing plants subject to pollution controland safety standards.

The Department shall establish assaylaboratories to cross-check the integrity ofcustom mills and to render metallurgical andlaboratory services to mines.

Custom mills shall be constituted aswithholding agents for the royalties,production share or other taxes due theGovernment.


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The revenue to be derived by the

Government from the operation of the

mining program herein established shall be

subject to the sharing provided in the Local

Government Code.


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The noncompliance with the terms and conditions of

the contract or violation of the rules and regulations

issued by the Secretary pursuant to this Act, as well as

the abandonment of the mining site by the contractor,

shall constitute a ground for the cancellation of thecontracts and the ejectment from the people's small-

scale mining area of the contractor. In addition, the

Secretary may impose fines against the violator in an

amount of not less than Twenty thousand pesos

(P20,000.00) and not more than One hundred thousandpesos (P100,000.00). Nonpayment of the fine imposed

shall render the small-scale mining contractor

ineligible for other small-scale mining contract


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Small-scale miners who have been in actual

operation of mineral lands on or before

August 1, 1987 as determined by the Board

shall not be dispossessed, ejected or

removed from said areas: provided, that they

comply with the provisions of this Act.


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The Board shall be composed of the Department of

Environment and Natural Resources representative as

Chairman; and the representative of the governor or city

mayor, as the representative of the governor or city

mayor, as the case may be, one (1) small scale miningrepresentative, one (1) big-scale mining representative,

and the representative from a nongovernment

organization who shall come from an environmental

group, as members. (a) Declare and segregate existing gold-rush areas for

small-scale mining;

(b) Reserve future gold and other mining areas for

small-scale mining;


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(c) Award contracts to small-scale miners;

(d) Formulate and implement rules and

regulations related to small-scale mining;

(e) Settle disputes, conflicts or litigations over

conflicting claims within a people's small-scale

mining area, an area that is declared a small-

mining; and

(f) Perform such other functions as may be

necessary to achieve the goals and objectivesof this Act.


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Violations of the provisions of this Act or of

the rules and regulations issued pursuant

hereto shall be penalized with imprisonment

of not less than six (6) months nor more than

six (6) years and shall include the

confiscation and seizure of equipment, tools

and instruments


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Approved on 29 October 1997.

Grants to indigenous cultural communities or

indigenous peoples (ICCs/IPs)- preferential

rights to their ancestral domains and all resources

found therein.


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generally belonging to ICCs/IPs

subject to property rights within ancestral domainsalready existing or vested upon the effectivity of

the IPRA

comprising lands, inland waters, coastal areas, and

natural resources held under a claim of ownership, occupied or

possessed by ICCs/IPs by

themselves or through their ancestors

communally or individually


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since time immemorial, continuously to the

present, except when interrupted by war,force

majeure or displacement by force, deceit,

stealth, or as a consequence ofgovernment

projects or any voluntary dealings entered intoby the government and private persons

which are necessary to ensure their economic,

social and cultural welfare.


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No mineral agreement shall be approved unlessthere is a prior certification from the NationalCommission on Indigenous Peoples (NCIP) thatthe area does not overlap any ancestral domainor that the prior free and informed written

consent as been obtained from the ICC/IPconcerned.

memorandum of agreement with the ICC/IPconcerned, through their Council of Elders.

memorandum of agreement will govern the

utilization, extraction and development ofnatural resources within their ancestral domain.

This agreement is subject to a limited term of 25years, renewable at the option of the ICC/IP foranother 25 years.


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ICCs/IPs have rights of ownership over lands,

waters, and natural resources and all

improvements made by them at any time

within the ancestral domains/lands.

right over the fruits, the right

to possess, the right to use, right to

consume, right to exclude and right torecover ownership, and the rights or

interests over land and natural resources.


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ICCs/IPs have the right to control, manage,

develop, protect, conserve, and sustainably use:

land, air, water and minerals;

plants, animals and other organisms;

collecting, fishing and hunting grounds;

sacred sites; and

other areas of economic, ceremonial and

aesthetic value in accordance with their

indigenous knowledge systems and practices

and customary laws and traditions, and duly

adopted Ancestral Domain Sustainable

Development and Protection Plan (ADSDPP)


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right to benefit from the utilization,

extraction, use and development of lands

and natural resources within their ancestral

lands/domains and to be compensated for

any social and/or environmental costs of

such activities.


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I. Human Rights The extractive industry worldwide has been

described as having an enormous and intrusivesocial and environmental footprint. The miningindustry has a deplorable record in relation to

human rights, resulting from militarization andcorruption, and leading to a broad array ofabuses up to and including complicity in crimesagainst humanity.

The extractive industry is utterly dominating in

terms of reported abuses, accounting for two-thirds of the total reported.

This trend is evident in the Philippines withabuses affecting local communities, especiallyindigenous people.


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a. Security Firms and Militarization

Following his country visit in 2003, the

Special Rapporteur on the Human Rights and

Fundamental Freedoms of Indigenous

Peoples, Professor Rodolfo Stavenhagen,

stated that the militarization of indigenous

areas is a grave human rights problem.

Members of the Subanon indigenous people

related that 169 armed security guards, hired by

the TVI mining company, 31 were manning

checkpoints and blocking access to their

ancestral domain.


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a(1). Extrajudicial Killings Between 2001-2006, it is claimed that at least 11

extrajudicial killings were related to protestsagainst mining.

There is a climate of fear developing amonglegitimate protesters against governmentpolicies and commercial projects and theapparent lack of effective protection of the rightto peaceful protest and opposition.

It is inadvisable to develop large-scale and

controversial mining projects in anenvironmentally and socially responsible way ifpeople feel threatened when they criticizegovernment and corporate practices.


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II. Corruption

A number of corruption activities is linked withmining at local government level.

The EITI is a multi-stakeholder initiative to

address corruption within the extractiveindustries. The EITI requires government,industry and civil society to work together topublish and verify company payments andgovernment revenues from mining.

The Government of the Philippines and thePhilippines Chamber of Mines have expressedinterest in this initiative but have not yet signedup to it. Its is currently a candidate for EITI.


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III. Pressure on the Judiciary

At the Philippine governments mining roadshow

in London in June 2005, the Speaker of the

House of Representatives, Jose De Venecia, told

international mining investors about his role inthe controversial reversal of a SC decision on the

constitutionality of the Mining Act in the La

Bugal-Blaan Tribal Assn v. Ramos case of 2004.

He announced that, together with the Chamberof Mines, he mounted a strong campaign to get

the Supreme Court to reverse itself.


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The statement appeared to indicate that the

Philippines judiciary may be vulnerable to

pressure from legislators.

In addition to that, while it is clear that laws

in the Philippines seem to provide a

framework for the protection of local rights,

it appears to be practically impossible for

local communities to obtain timely and

effective resolution of cases submitted at

municipal and regional trial courts.


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IV. Environmental Concerns The record of mining companies with regard to

environmental protection, disasters and post-mining clean-up in the Philippines is very poor.

The DENR has described the Philippines as thehottest of hotspots in the world in terms ofthreats to its mega diverse biodiversity. Ithighlighted the urgent need to properly managenatural resources and protect the environment.

The loss of forest has resulted in increased

flooding, devastating landslides, siltation andthe destruction of biodiversity areas. Large-scalemining has the potential to seriously exacerbatethis.


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Many mining applications in the Philippines arein water catchment areas very close to the sea,and pose a major threat to valuable marineenvironments.

The Philippines has very high geo-hazard risks.

Typhoons, earthquakes, volcanoes and landslidesare common. Alarmingly, over half of the activemining concessions and two-thirds of exploratoryconcessions are located in areas of high seismicrisk where earthquakes are considered likely.

The Marcopper disaster was blamed by PlacerDome, the company operating the mine, on aminor earthquake. The spill of tailings slurryaffected 20,000 people and resulted in the Boacriver being declared biologically dead.


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a. Food and Water Security Grave concerns about the potential impact on

the volume and quality of water have beenraised by communities downstream of existing

mines. International experience suggests that if pursued

on the scale currently proposed by the Philippinegovernment, mining could weaken the foodsecurity of affected communities and even of

the country as a whole. Local communities fear that pollution and

siltation of rivers may deplete water sources,reducing rice production and fisheries.


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In the Philippines, many mining and

exploration concessions overlap watershed

areas where demand for water exceeds the

available supply.

Mining in these areas would therefore be

likely to compete with the needs of other

users, including farmers and households, for

scarce water.

Many mining sites are located on mountains

that act as watersheds for numerous rivers,

potentially compounding the threat.


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b. Environmental Social Impact Assessments& Strategic Environmental Assessments

Hard-won provisions for public participationin Environmental Impact Assessments (EIAs)

are being eroded in the name ofstreamlining application processes.

Recent Administrative Orders have weakenedparticipation rights, including the right to

information, participation in decision makingand access to justice.

This undermines the protection afforded byEIAs in the Philippines.


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Locals and NGOs reported the difficultycommunities had in obtaining copies of EIAs, andof the lack of independent analysis orexplanation of their contents and implications.

Another area of concern is the seeming lack of

attention to the social and environmental impactof projects. This includes identification ofthreats to biodiversity and sustainabledevelopment and their potential accumulativeimpacts. To ensure protection of indigenouspeoples rights, all protected areas must beidentified as well.

Currently there seems to be no comprehensiveassessment of these important potentialimpacts.


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V. Indigenous People and Free, Prior, Informed,Consent

The Indigenous Peoples Rights Act (IPRA, 1997)and the Mining Code (Republic Act 7942, 1995)guarantee indigenous peoples the right to free,

prior, informed consent (FPIC) over decisionsaffecting them and developments on theirlands.

This right is being systematically denied to theindigenous peoples of the Philippines.

There is lack of independent informationregarding mining that is made available to IPs. Asa result they feel that they are not in a positionto make an informed choice.


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Another serious issue raised by theindigenous communities was what they

described as a type of foot in the door

policy being operated by mining companies.

Companies only provide IPs with details of

their initial planned operations and do not

give them information on the potential for

future expansion.


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Indigenous communities felt that miningcompanies lacked respect for theirtraditional cultures, viewing their right toFPIC as a technical obstacle to be overcome

as quickly as possible rather than a necessaryprotection of rights.

IPs also suffer from factionalism andmisrepresentation. In cases where theconsent of the indigenous people has notbeen forthcoming, non-representativeindigenous leaders have been created andrecognized by the NCIP and the miningcompanies.


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a. Lack of Independent Monitoring & ExpertiseProvision & the NCIP

The NCIP is the body mandated to protect andpromote the interest and well-being of the

ICCs/IPs. The perception among indigenous people, based

on their experience on the FPIC process to date,is that the NCIP is failing in its mandate and hasin many cases sided with mining companies.

Given this perception of the NCIPs bias againstindigenous peoples, there is a need to addressits lack of credibility and restore confidence inlegal processes.


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There is also a need to mandate anindependent body to provide scientific andlegal assistance to indigenous peoples duringthe FPIC process.

Such a body is essential to ensure thatindigenous people are in a position toconsider giving their informed consent.

There is a need to provide independent

assessments and explanations on the FPICprocess and it should be in a language andformat understandable to indigenouspeoples.


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b. Weaknesses in the Law

Two major problems in the current IPRA

legislation and its Implementing Rules and

Regulations (IRR), in relation to FPIC:

1. The short timeframe allotted for

consensus building in the Implementing Rules

and Regulations;

2. the current interpretation of Section56 of the IPRA which seeks to deny indigenous

peoples the right to FPIC for mining operations

that existed before the enactment of the IPRA.


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VI. The Philippines Local Government Code

The Local Government Code of 1991 requires

that local governments be consulted with

regard to development initiatives, including

mining operations, within their jurisdiction.

In practice it seems this requirement is

frequently over-ridden by national

government, or ignored, or renderedineffective by bribery.


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VII. Health Impacts

Mining can have serious health implications

for local communities.

In commercial mining, cyanide separation is used

to extract gold from ore. It is estimated that

one-millionth of a gram of cyanide per liter of

water can be fatal to fish. The mining process

can also lead to toxic metals being released from

the ore. If toxic metals, mercury or cyanide getinto the food chain they can seriously damage

health.


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VIII. Militarized Commerce The large economic rents generated by

extractive industries may help provoke orprolong civil conflict.

Indigenous peoples are particularlyvulnerable.

One of the core macro-governance criteriain relation to mining should be the absence

of conflict or ofa high risk of conflict andthat in no circumstance should the WorldBank support mining projects in areasinvolved in armed conflict.


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In the Philippines mining is currentlyproceeding in conflict zones.

There had been extensive human rights

violations by the army in northern Mindanao

in connection with economic development

projects including mining.

Both the Moro Islamic Liberation Front (MILF)

and Abu Sayyaf are reported to have beenactive in the Zamboanga provinces, where

TVI is operating.


79/100

a. Peace Agreements

The peace negotiations between the government

and the MILF may enable mining on indigenous

peoples lands without their consent.

Failure to address the concerns of indigenouspeoples in the peace negotiations could lead to

instability and the denial of rights their rights.

United Indigenous Nations of Mindanao expressed

their opposition to the inclusion of theirancestral domains and ancestral lands in the

proposed coverage of the Bangsamoro homeland.


80/100

IX. Economic Model

The government of the Philippines is

promoting mining as assisting in the

Governments program on poverty alleviation

and contributing to the general economic

well being of the nation.

However, evidence of mining benefiting the

local poor or the countrys economy as a

whole is quite scant.


81/100

On the evidence available to it, the fact-finding team has strong grounds to believe

that:

Large-scale, technologically sophisticated mining

appears unlikely to lead to job creation. There isconsiderable basis for the fear that more

livelihoods will be destroyed (through damage to

agricultural land and fisheries, and displacement

of small-scale miners) than new jobs created. It seems clear that revenues to the state, once

incentives have been accounted for, will be

substantially less than expected.


82/100

Based on all past experience, affected poor andindigenous communities on site and downstream

will be worse off. The fact-finding team was not

convinced that royalty payments would

adequately offset such impacts. They remainconcerned that the management of royalty

payments was lacking in transparency and

participation, and might become a source of

corruption and conflict.


83/100


84/100

Responsible Mining is complying with thelaws that already take into account its

environmental, social, economic, cultural,

and other impacts.

However, this assumes that the existing

regulations are enough to safeguard the

health of the environment and human

communities, and that these come with

effective mechanisms of implementation.


85/100

Responsible mining can also be measuredusing basic principles developed and adopted

by ethical mining companies worldwide.

The Philippine Chamber of Mines Compliance

and Beyond: A Guidebook on Corporate Social

Responsibility for the Philippine Mining

Industry


86/100

The following principles are the bases for theGuidebook:

Protect the environment as a paramount

consideration in all stages of mining and conduct

activities in a manner that will contribute to thebroader goals of sustainable development.

Protect the rights of affected communities,

including the rights of indigenous cultural

communities. Engage in adequate and timelycommunication and consultation with them and

work for the improvement of the quality of their

lives during and even after the life of the mine.


87/100

Safeguard the health and safety of mineworkers,local population, host and impact communities,

and address foreseeable health- and safety-

related impacts associated with mining over its

full life cycle. Maintain a competent workforce that is

committed to responsible mining and whose

welfare is advanced. Make sure that affected

communities benefit from mining through

employment, whenever possible.


88/100

Respect, protect, and promote human rights ofthose affected by mining and promote human

rights-sensitive security arrangements.

Adopt responsible corporate governance and

management principles that nurture trust andpromote company integrity by developing

effective self-regulatory practices and

management systems and employing business

practices that are ethical, transparent and

accountable.


89/100

In the Philippines, a special concern forresponsible mining is the identification ofno-go areas.

Despite provisions in the law that identify

areas closed to mining, field implementationhas been beset by conflicts.

In 2000, DENR issued Administrative OrderNo. 83 on Guidelines for the Management

And Development of Small Islands, IncludingIts Coastal Areas but this regulation has notstopped the exploitation of mineral resourcesin small islands and coastal areas.


90/100


91/100

Responsible mining has to accurately assessand account for all relevant costs andbenefits: The appropriate valuation mechanisms should be

employed to ensure that the environmental andsocial responsibilities are accounted for, and thatthe negative impacts are mitigated and affectedcommunities compensated.

There must be a more comprehensive

articulation of risk assessment for disastermanagement, given that the Philippines is proneto geophysical disturbance and climate change-induced hazards.


92/100

Regulations on environmental impact studiesshould be reviewed to account for the value ofbiodiversity and ethno-diversity significance.

Responsible mining has to respect no-go

areas: There must be respect for the NIPAS and SEP for

Palawan that declare areas closed to mining.

There must be respect for the right of localgovernments to close areas within their

territorial jurisdiction to mining operations as aprecautionary measure, in the absence ofcredible information on impacts and acceptablerisks.


93/100

Small island ecosystems should be excluded from

mining. Agenda 21 of the United Nations

identifies small islands supporting small

communities as special cases for environment

and development, being ecologically fragile andvulnerable. The ocean and coastal environment

of small islands of strategic importance and

constitutes a valuable development resource.

Their small size, limited resources, geographic

dispersion and isolation from markets, placethem at a disadvantage economically and

prevent economies of scale.


94/100

Responsible mining has to respect the

decision of local stakeholders, especially

indigenous peoples:

Inconsistencies in the implementation of FPIC

raise serious doubts as to the validity of

community consent and benefit-sharing

agreements.

The right of IPs and local communities to say

no should be respected and not taken as aprovisional decision subject to negotiation until

communities finally say yes.


95/100

Small-scale mining should be held to the

same high standards:

Policies on small-scale mining should be revised

to account for the same impacts as large-scale

mining.


96/100


97/100

Defining a policy to get the best deal forthe people - The country and localcommunities apparently get little in terms ofbenefits from mining, compared to the

returns that investors get. The PhilippineDevelopment Plan (PDP) noted that the fairshare of the government from mining has notbeen achieved due to the existing incentivemechanism. Comparative data ongovernment benefits from mining areconflicting; therefore the government mustmake further studies to firm up itsnegotiating position.


98/100

Defining clear indicators for reforms Clearand measurable indicators are needed to

track compliance and progress in reforms

needed for responsible mining, including

inclusiveness of economic benefits, as well

as social, cultural, and environmental

safeguards. The government needs to design

and implement a systematic monitoring and

evaluation (M & E) process based on theseindicators.


99/100

Continuous capacity building In order tosupport stable, rational decision-making, the

government must have the capacity to

implement:

Natural resources valuation; Options for benefit-sharing schemes at the national,

local, and community level;

Measuring local economic impact;

Measuring impact on community values and culture;

Establishing systematic monitoring and evaluation of

environmental, social, and economic impacts at all

levels (project, local, and national); and

A genuine and inclusive process of obtaining free and

prior informed consent.


100/100

Setting a clear action plan with areasonable timetable and sufficient budgetand personnel supportThe actions neededmust be set in a clear, doable, time-bound,

and adequately funded action plan, so that

all stakeholders can reasonably expect

accomplishment of the reform goals. The

reforms are only as good as their

implementation. Government has to providethe manpower needed to implement the

reforms both at national and local

mining in the philippines

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