China recognizes how a strong mining industry plays significant role in the future of the country’s economy. However, in the recent years, there has been failure in meeting the requirements in domestic supplies for mineral commodities in terms of economic expansion. This situation has led to attempts at reformulating the minerals regulations system of China.
These measures are made in order to promote development in the mining industry in the hopes that it can aid in achieving the country’s social development and national economic objectives. According to China mining law policy, rights to mineral exploration and exploitation can only be granted by State enterprises or of Chinese-Foreign cooperative ventures.
Following that, certain rules about mining concerning foreign interests are strictly observed:
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1.
Foreign Interests
Foreign companies, under the 1983 “Special Industry” Rules, are not allowed to recover either gold or silver. According to the 1983 Rules, only the Bank of China can purchase and distribute gold and silver in the country. Additionally, all other precious metals cannot be exported and have to be sold to the Bank of China.
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2.
Foreign Investment
It was only in 1993 that the PRC allowed foreign investment in the country in terms of mining and exploring natural resources. Mineral resources that are available for exploration to foreign investors are divided into:
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“Encouraged”
Projects that are limited to Chinese- foreign joint business ventures. Includes oil and natural gas, coal-bed gas, mine gas, unconventional resources of oil, and more. -
“Restricted” Projects
– includes special and rare coal, precious metals, barites, diamonds and important non-metallic metals. -
“Prohibited” Projects
— includes exploration, exploitation as well as ore dressing of radioactive minerals and rare earth. Tin, fluorite, tungsten, stibonium and molybdenum are prohibited.
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3.
Environmental Protection
China’s Environmental Protection Law requires for enterprises with production facilities that can be cause to pollution to register with authorities on environmental protection. Before construction of facilities to be used for mining and exploration, environmental impact has to be done and submitted to the environmental authority.
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4.
Safety of Production
There is relatively wide set of laws and administrative regulations concerning production safety in the mining industry formulated by the Chinese government. According to this, no mining enterprise are ever allowed to engage in any production activities if they do not have a valid certificate on production safety.
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5.
Restriction on Rare Earth Metals
China holds about 37% of the Earth’s rare earth metal reserves and the country is known to outpace any other country in the capacity to process these rare metals. Currently, China is known to produce 95% of the rare earth metals being sold worldwide. The restriction on over 600 mineral resources is imposed by China as they consider them vital to national interest.