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  • GDP, US$bn: 7.8
  • GDP per capita, US$: 1,528.6
  • Population, mn: 4.6
  • Inflation, CPI ave: 3.5
  • FX, LCY/US$: 592.9
  • Budget Balance, % of GDP: -11.6
  • Mining GVA, US$bn: 4.3
Regulatory Risk Rating
47
0
100
Score: 47
Substantial Risk
The Republic of Congo's mining code shadows best practice, but remains largely in the dark; its most profound weakness is the imposition of a mining convention as a condition to exploitation, thereby casting the state into the spotlight as the main protagonist and ultimate determinant of economic return.

Corruption Potential Index

Score: 40
Very High Corruption Potential

Corruption Risk Index

Score: 43
Moderate Corruption Risk

Regulatory Risk Rating

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Mining Overview Commentary plus sign

REPUBLIC OF CONGO (CONGO-BRAZZAVILLE) - MINING REGULATION

GENERAL

The Republic of the Congo (Congo-Brazzaville) is located in Central Africa, with Gabon bordering the west, Cameroon to the northwest, the Central African Republic to the northeast and the Democratic Republic of Congo the east and south. Since 2002, when the new constitution was issued, it has been divided into 12 departments (départements), which are further subdivided into districts and communes. The country is considered politically stable, although the government has faced numerous accusations of corruption and it is rated at 148th out of the 168 countries covered by Transparency International’s 2015 Corruption Perceptions Index.

The Republic of the Congo is known for its oil reserves with the oil sector being the largest contributor to GDP, however it also possesses numerous large-scale, undeveloped natural resources, including iron ore, magnesium, diamonds, potash, phosphate, copper, lead, zinc and gold. The country is one of the largest petroleum producers in Africa, but the government has actively promoted the mining industry in more recent years. Small-scale artisanal miners have dominated the diamond and gold mining sectors, while international mining companies are focused on exploration for base and precious metals, as well as industrial minerals. MagMinerals, a Canadian company, recently commenced construction of a large potash mine in the country.

PRINCIPAL LEGISLATION AND REGULATOR

The primary minerals legislation in the Republic of Congo is the Mining Code (Law no. 5-2005 dated 11 April 2005) (Mining Code). While a new Mining Code has been anticipated since late 2014, at the time of writing (Jan 2016) it has yet to be promulgated. Additional details relevant to mining are provided in the Loi no. 24-2010 du 30 décembre 2010 fixant les taux et les règles de perception des droits sur les titres miniers and the Décret no. 2007-274 du 21 mai 2007 fixant les conditions de prospection, de recherche et d’exploitation des substances minérales et celles d’exercice de la surveillance administrative (Mining Regulations). The Mining Code does not apply to liquid or gas hydrocarbons, which are regulated by specific legislation. The granting of mining rights confers immovable, non-mortgageable rights, which are distinct from surface rights.

The mining industry is governed by several agencies. The President of the Republic of Congo has jurisdiction over the enactment of mining regulations, while the Ministry of Mines oversees the Mining Code (through its Department of Mines and Geology, which is the administrating agency). The Ministry of Mines was restructured in 2009 to simplify and streamline the process by providing a single government focal point for mining companies. As well, the Bureau for Assay, Evaluation and Certification of Precious Metals was created in 2008 to control artisanal alluvial diamond extraction. In addition, the government has recently established several institutions to facilitate investment in the mining sector: the Centre for Geological and Mining Research, tasked with conducting research to collect data to improve knowledge of the subsoil and develop maps in accordance with international standards; the Investment Promotion Agency to facilitate investment in the Republic of Congo; and the Office for the Expertise, Assessment and Certification of Precious Minerals, tasked with cataloguing the country’s mineral wealth and organizing the certification process. An Investment Code (Loi no. 06-2003 du 18 janvier 2003 portant charte des investissements) provides that all natural persons and legal entities, regardless of nationality, can conduct mining activities in the Republic of Congo.

The state will execute a mining agreement (convention minière) with holders of exploration or mining permits. This agreement defines the rights and obligations of the parties regarding the investments and operations, including arbitration and settlement of disputes. Under the mining agreement, the permit holder commits to respect the rights and interests of the landowners; give priority to the recruitment of equally qualified and experienced nationals, as well as the use of local products and services with equal delay and quality conditions; and ensure the permanent training of local personnel. Mining permit holders are required to incorporate a Congolese company as the operating entity, with at least 10% of the share capital held by the state.

According to the Mining Code all mineral substances in the soil and subsoil, including those beneath territorial and maritime waters, are owned by the state.

GRANT AND FORMS OF MINERAL TITLE

The Mining Code establishes several different types of mining rights, namely:

  • Prospecting Authorisation: This confers a non-exclusive prospecting right, which is valid for a one-year period, renewable once, and cannot be leased or transferred. Prospectors have the right to apply for an exploration or mining permit over the relevant area. This authorisation may be obtained by any natural person of at least 18 years of age or by any legal entity.

 

  • Exploration Permit: The principle of “first come, first served” is modified insofar as financial and technical competence may be weighed in the grant of an exploration permit. These permits, granted by decree of the Council of Ministers upon report of the Minister of Mines, confer exclusive prospecting and exploration rights within the relevant perimeter for the substances for which it is granted. The permits are indivisible, immovable rights, and may be assigned subject to the prior approval of the Minister of Mines. The permit can be obtained by any natural person over 18, or any legal entity. The surface area covered by a permit cannot exceed 2,000 km for sedimentary formations, or 1,000 km for other formations. The permits are valid for three years and can be renewed twice for two-year periods. For each renewal, the permit is reduced to a maximum of 50% of the pervious surface area. Successful exploration works allow the permit holder priority in applying for a mining permit for the relevant area. If the exploration permit expires prior to the administrative decision on the request for the mining permit, the exploration permit is extended.

 

  • Mining Permit: This permit is granted by decree of the Council of Ministers at the proposal of the Minister of Mines following a public hearing. The permit grants the exclusive right to mine the relevant substances and can be assigned, transferred or leased with the consent of the Minister of Mines. Applicants must submit a feasibility study, a plan for development and mining of the deposit and an EIS (including an environmental protection plan and a site rehabilitation plan). The permit is granted to the following: exploration permit holders who demonstrate the existence of an exploitable deposit and present a technical and financial plan; persons who are at least 18 years of age or legal entities that demonstrate their technical and financial capacity; and, in certain cases, holders of a (small-scale) mining authorization. The permit cannot exceed 25 years and is renewable for periods not exceeding 15 years.

 

Other permits may be granted in respect of small-scale operations, including an Artisanal Mining Authorisation (to natural persons of Congolese nationality) and Mining Authorisations, which applies to quarries and small mines.

DEVELOPMENT CONSIDERATIONS

The Environmental Protection Law (Loi No. 003/91 sur la protection de l’environnement (1991)) states that all economic development projects in the Congo must include an EIS, and the specific requirements are established by a Decree of the Council of Ministers (Décret no. 2009-415 du 20 nombre 2009 fixant le champ d’application, le contenu et les procédures de l’étude et de la notice d’impact environnemental et social). The Mining Code also requires an EIS with an environmental protection plan detailing the measures adopted to reduce or avoid nuisance and pollution and a site rehabilitation plan as a precondition to the grant of a mining permit.

According to Décret no. 2007-274 fixant les conditions de prospection, de recherche et d'exploitation des substances minérales, a mining title holder may obtain authorization via Arrêté d’occupation of the Minister of Mines to occupy the terrain necessary for the holder’s mining and related industry activities and to cut wood necessary for work in conformity with the Forestry Code. For any natural resource exploitation in lands traditionally used by indigenous populations, a socioeconomic and environmental study is required, and such populations cannot be displaced except for the public interest. The decree establishing the EIS requirements (Décret no. 2009-415 du 20 novembre 2009 fixant le champ d’application, le contenu et les procédures de l’étude et de la notice d’impact environnemental et social) requires that the EIS include social, cultural and economic impacts on citizen life, including public health. The decree further requires public consultation or a public hearing for the majority of projects.

The Constitution (2002) guarantees the right to acquire land and precludes the expropriation of land, except for public purposes in which case fair compensation must be paid to the landowner, while the Mining Code provides procedures for the occupation, expropriation and acquisition of lands, in addition to procedures for providing compensation to landowners affected by mining operations.

ENVIRONMENTAL REGULATIONS

See Republic of Congo (Congo-Brazzaville) Environmental Overview Commentary.

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REPUBLIC OF CONGO (CONGO-BRAZZAVILLE) - ENVIRONMENTAL REGULATION

GENERAL

The Republic of Congo (Congo-Brazzaville) is located in Central Africa, with Gabon, Cameroon, Central African Republic and Democratic Republic of Congo bordering and the South Atlantic Ocean running along its south-western coastline.

The country has coastal plains in the southwest with low mountains further inland, numerous vast plateaus and various mountainous regions and valleys. The Congo Basin area covers a large portion of the country and around 70% of the region is rainforest. The Republic of Congo has a tropical climate, typical of this area of the African continent; March to June marks the country’s rainy season, while June to October is considered the dry season; temperatures vary little throughout the year. The rainforest acts as a major source of timber; common trees include the African oak, red cedar, mahogany and walnut. Chimpanzees, gorillas, elephants, pangolins, lions, leopards and cheetahs are amongst the country’s notable wildlife.  

The Republic of Congo’s current environmental challenges include air pollution from vehicle emissions, water pollution from raw sewage, and deforestation. Natural hazards include seasonal flooding.

PRINCIPAL LEGISLATION AND REGULATOR

The Constitution (2002) makes several references to the environment and natural resources, with the preamble reaffirming the peoples’ permanent inalienable sovereignty over the country’s riches and natural resources. All citizens have a right to a healthy, sustainable environment, which they have the duty to defend, and the state ensures environmental protection and conservation. Further, the Constitution states that all pollution or destruction resulting from economic activity requires compensation. The principal environmental legislation in the Republic of is the Environmental Protection Law (Loi No. 003/91 du 23 Avril 1991 sur la protection de l’Environnement), which provides for the protection of human settlements, flora and fauna, air, water and soil. Decree 2009-415 establishes the terms and conditions for environmental assessments in the region.

Environmental management occurs at the national level and is currently overseen by the Ministry of Tourism and Environment. The government of the Republic of Congo has undergone numerous changes and environmental responsibility has been shifted between several ministries over recent years.

EIA PROCESS AND OTHER PERMITS

The Environmental Protection Law (as well as the Mining Code itself) states that all economic development projects in the Republic of Congo must include an environmental impact study (EIS). A decree by the Council of Ministers (Décret no. 2009-415 du 20 novembre 2009 fixant le champ d’application, le contenu et les procédures de l’étude et de la notice d’impact environnementale et social) establishes the terms and conditions for an EIS (for Category A - high impact activities) and a notice of environmental impact (for Category B - medium impact activities). Most mining projects are likely to be classified as Category A projects, which is reinforced by reference to the fees payable for extractive industries (non-petroleum) being found under Category A.

All activity subject to an EIS or a notice of environmental impact must be subject to a public inquiry organized by the project promoter. The promoter sends a request to conduct the EIS or notice to the Minister responsible for the environment with a copy of the project. The Minister responsible for the environment has ten days to respond to the request. At the end of this period, the promoter may send a reminder letter to the Minister, who has five days to respond. If there is no response to the second request, the promoter is deemed to have authorization for the project.

An EIS is “validated” after filing to determine whether or not (i) the proponent has correctly applied the guidelines and benchmarks for the type of project under consideration and (ii) the proposed measures to prevent and / or correct the expected adverse effects of the project on natural and human environment are sufficient and appropriate (Art. 27). The validation of the EIS is conducted in two phases (Article 30): (i) a public hearing or public consultation and (ii) a technical analysis. The public hearing is carried out by an investigating commissioner and results in a memorandum. After receipt of the memorandum the technical committee is convened within 15 days, and it then has three months to report and issue a technical opinion on the environmental feasibility of the project. This opinion must be approved by the Minister responsible for the environment within 7 days. If within three months the government does not react to the EIA report, the report is deemed to be approved.

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