I. Regulations
(I) The 1987 Constitution of the Republic of the Philippines
The Constitution of the Philippines stipulates that all natural resources in the Philippines are owned by the State, and all activities related to the exploration, development, and utilization of natural resources are subject to the full supervision and control of the State. The State has the right to jointly develop mineral resources with Filipino citizens, or corporations and associations at least 60% of whose capital is owned by such citizens, through co-production, joint venture, or production-sharing agreements. The Constitution authorizes the President of the Philippines to enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other mineral oils. Only Filipino citizens or corporations at least 60% owned by Filipino citizens may acquire private land; foreigners and foreign-owned corporations may lease private land through lease agreements for a term of 50 years, renewable for another 25 years.
(II) The Philippine Mining Act of 1995
The Philippine Mining Act of 1995 stipulates that the Department of Environment and Natural Resources (DENR) is the primary agency responsible for the management, development, and rational utilization of mineral resources, as well as the issuance of corresponding regulations. The Secretary of the DENR may sign mining contracts on behalf of the government. The Mines and Geosciences Bureau (MGB), under the DENR, is directly responsible for the management and allocation of mining areas and mineral resources, conducting geological and mining research, and geological exploration of mines. In addition, it is responsible for recommending mining contracts and contractors for the Secretary's approval and supervising the implementation of contractor agreements. The MGB has regional offices responsible for handling authorization matters.
Philippine mining exploration and mining permits mainly include: Exploration Permit (EP), Mineral Production Sharing Agreement (MPSA), Co-Production Agreement (CPA), Joint Venture Agreement (JVA), Financial or Technical Assistance Agreement (FTAA), Quarry Permit (QP), Sand and Gravel Permit (SAG), Small-Scale Mining Permit, Mineral Processing Permit, and Ore Transport Permit.
1. Exploration Permit (EP)
An Exploration Permit is issued by the Director of the MGB or the Regional Director. It allows any qualified Filipino citizen or corporation (at least 60% Filipino-owned) or foreign-owned corporation (less than 50% Filipino-owned) to conduct various mineral exploration activities within a specified area, but it does not grant the right to mine. The contractor must have a minimum authorized capital of 10 million pesos and a minimum paid-up capital of 2.5 million pesos. If exploration reveals that the mineral deposit is economically and technically feasible for mining development, the holder may submit a mining project feasibility report. Upon approval, they may apply to upgrade the Exploration Permit to a mining agreement or a Financial or Technical Assistance Agreement. The term of an Exploration Permit is 2 years, renewable for 2 years at a time, with a total term not exceeding 6 years (for non-metallic minerals) or 8 years (for metallic minerals). Exploration Permit area: (1) Onshore: in any one province, 1,620 hectares for individuals and 16,200 hectares for corporations; nationwide, 3,240 hectares for individuals and 32,400 hectares for corporations; (2) Offshore: beyond 500 meters from the coastline, 8,100 hectares for individuals and 81,000 hectares for corporations.
2. Mining Agreement (MA)
Issued by the Secretary of the DENR. Includes Mineral Production Sharing Agreement (MPSA), Co-Production Agreement (CPA), and Joint Venture Agreement (JVA). It allows any qualified Filipino citizen or corporation (at least 60% Filipino-owned) to enjoy the exclusive right to explore, develop, and mine mineral resources within the contract area. The contractor must have a minimum authorized capital of 10 million pesos and a minimum paid-up capital of 2.5 million pesos. Mining permit area: (1) Onshore: in any one province, 810 hectares for individuals and 8,100 hectares for corporations; nationwide, 1,620 hectares for individuals and 16,200 hectares for corporations; (2) Offshore: 4,050 hectares for individuals and 40,500 hectares for corporations.
(1) Mineral Production Sharing Agreement (MPSA)
Requires the contractor to provide the necessary financing, technology, management, and personnel to complete the agreement, with the Philippine government sharing in the gross output of the mining. All MPSAs must be applied for at the MGB regional office and may be transferred upon approval by the MGB Director or the head of the MGB regional office. While the MPSA application is pending approval by the DENR Secretary, the MGB Director may issue a Temporary Exploration Permit (TEP) valid for 1 year. If the MPSA application is approved, the exploration period is deducted from the MPSA term; if not approved, it automatically expires. The term of an MPSA cannot exceed 25 years and may be renewed for a period not exceeding 25 years. Upon expiration of the MPSA, the operation is taken over by the government or its designated contractor (the highest bidder in a public tender), and the original MPSA contractor has the right to continue to obtain the MPSA at the highest bid price after repaying all reasonable expenses. During the exploration period, the contractor may relinquish all or part of the contract area; after exploration ends, areas outside the feasibility report must be relinquished. The final MPSA area is: 5,000 hectares for metallic minerals and 2,000 hectares for non-metallic minerals.
(2) Co-Production Agreement (CPA)
Signed between the government and the contractor, where the government provides mining inputs rather than mineral resources.
(3) Joint Venture Agreement (JVA)
The government and the contractor form a joint venture company, where the government shares in the profits based on its contributed assets and also shares in the gross output of the mining.
3. Financial or Technical Assistance Agreement (FTAA)
Issued by the President of the Philippines. Allows any qualified Filipino citizen or corporation (at least 60% Filipino-owned) or foreign-owned corporation (less than 50% Filipino-owned) to conduct large-scale exploration, development, and utilization of mineral resources. The contractor must have a minimum investment of 50 million USD and a minimum authorized capital of 4 million USD. An FTAA is granted for gold, copper, nickel, chromite, lead, and zinc, but not for cement raw materials, marble, sand, and gravel aggregates. The terms of the contract and the government's share are negotiable. The contract term cannot exceed 25 years and may be renewed for a period not exceeding 25 years. Mining permit area: (1) Onshore: 81,000 hectares; (2) Offshore: 324,000 hectares.
4. Mineral Processing Permit (MPP)
Issued by the Secretary of the DENR. Allows any qualified Filipino citizen or corporation (at least 60% Filipino-owned) and foreign-owned corporation (less than 50% Filipino-owned) to establish and operate a mineral processing plant. Valid for 5 years, renewable for 5 years at a time, but the total term shall not exceed 25 years.
(III) Environmental Regulations
The Department of Environment and Natural Resources (DENR) is the environmental protection and management agency in the Philippines. Its subordinate Environmental Management Bureau (EMB), local governments, and other agencies assist in formulating and enforcing environmental policies.
1. Environmental Impact Statement (EIS) System
Resource development is classified as an environmentally critical project. Before the project begins, an Environmental Compliance Certificate (ECC) must be obtained from the Environmental Management Bureau. The ECC indicates that the project will not cause significant negative impacts on the environment; the project complies with all requirements of the EIS and implements the approved Environmental Management Plan. The ECC includes specific methods and conditions to be adopted before and during project implementation, as well as measures to mitigate environmental impacts at the end of the project.
2. Ecological Solid Waste Management Act
3. Toxic Substances and Hazardous and Nuclear Wastes Control Act
4. Clean Air Act
5. Clean Water Act
6. Pollution Control Law
7. Water Code
8. National Environmental User's Fee (NEUF)
