SECTION TWO

SECTION TWO

COMMENTARY ON THE MINERALS AND MINING BILL

PART I: Ownership of minerals and cadastral systems

Section 2:
There is no specification on who can require land. There is no restriction on land use in particular forest reserves and other national heritage sites and monuments such as the Castles and Akosombo Dam.
Section 2 is further reinforced by section 3

Section 3: This is a new provision. By implication, this provision suggest that all land may be subject to an application for mineral rights except those expressly reserved under sub b. but on the contrary, no land has been expressly reserved.( Are forest reserves not expressedly reserved?) It is vital for the Mineral and Mining Bill to take into consideration the pertinent issues of sustainable development and the livelihood of the masses in the area if operation of the mines.

Proposals

Stringent rules should be put in place to control lands available for application for mineral rights. To achieve sustainable development, forest reserves, wide settlement areas, water bodies and lands with unique features should not be given for mining.

The Bill should expressly exempt such lands as forest reserves, wild life sanctuaries, sacred groves, etc from the criteria of land for the application for mineral rights. It is an international recommendation that each country should have at least 20% of its land for forest reserves. Ghana is a signatory to the International Convention on Biological Diversity, which recommends that at least 20% of a nation's land should forest reserves.

Section 5: Experience has shown that the mining companies can easily influence government officials hence the powers vested in the minister through the bill are too wide. This provision gives the Minister an unfettered right to grant, revoke, suspend or renew mineral rights. To invest the Minister with such unfettered discretion is to place those who apply for mineral rights at the mercy of the Minister and gives him the awesome power to decide who should be entitled to mineral right or not. There is no guide nor yardstick or strict standard that the Minister is bound to apply in determining the reasons for a decision. This provision would enable the minister, out of prejudice; bias, or even political preferences to refuse or grant mining rights on flippant and untenable grounds.

Proposals
The government on areas suitable for mining purposes should do a geological survey and socio economic survey. The communities should be involved in the socio economic cost of their land. After the survey is done and all the opportunity cost is calculated then the land can be declared open for mining. Hence anyone interested in mining can know the full cost of mining in terms of compensation. The cost must be paid up front. There is therefore the need to enumerate justifiable and practical reasons to measure the legality of the minister's decision on an application for a mining right. Hence Parliament has to ratify the minister's decision.

Section 7
The bill seeks to diminish a lot of information, which is contained in PNDC Law 153. There is a provision for the right of pre-emption to be exercised but there are no adequate provisions for the extent of which the application of this right is permitted.

Proposals
We therefore propose that Sections 4 -7 on pre-emption rights of government under PNDC Law 153 should be retained in the present bill.

PART II: Mineral rights

Section 12
This provision places a limited time frame for the commission to broaden consultation and research on the application. Secondly where there are many applications the cost of processing applications per year will increase

Proposal
The law should spell out the processes to be undertaken by the mineral commission before it makes its recommendation. The process should be widened beyond the commission and the time frame should be extended or fixed to a review on an annual basis.

Section 13(7):
This does not take into consideration the comparative advantage between the mineral right holder and the actual owner of the land because too much power and advantage is vested on the mineral right holder to do as he may please once he has license to mine.

Proposal
This power or authority over the land once a license is granted should be subject to other terms and conditions aimed adequately compensating the landowners.

Section 17:
We recognize the need for mining companies to request for permit under the Water Resource Commission Act of 1996. However, we are concerned that there was not adequate publicity on the act for e.g. communities were required to register their interest in water bodies before the law came into being in six months unless all water bodies will become subject to the law.

Section 19 and 20:
These sections are vague and broad because it does not specify which information should necessarily be in the public domain and does not clearly stipulate a reasonable fee. The extent of the transparency should be reconsidered since many stories on human rights abuses within miming concessions would be subject to this clause.

Proposals
There should be a listing of documents, which should be confidential and we believe that the environmental annual audit reports are not to be confidential and should be made available.

Section 21:
There is wrong reference to section 19 (2) instead of section 20 (2).

PART III: Royalties, rentals and fees

Section 25: What are the justifications for the royalties to be reduced to between not more that 6% and not less than 3%? The maximum rate of royalties to be paid is too low as compared to 12 % of PNDC Law 153. As the law stands no company has ever paid more than 3% for royalties.

Proposal
The royalties should be left to be not more than 12% and not less than 3%.

Section 26:
This section gives room for arbitrary decision and actions and places the applicants for the mining rights under the whims and caprices of the minister. We know from experience that deferment in royalty payment has caused irrecoverable losses to the state and communities and should not be encouraged in our law books.

Proposal:
There should be no deferment of royalties. In order to achieve durable investment goals, companies with limited resources should not be allowed to invest in Ghana.

Section 27(2):
This section acts as a springboard for unscrupulous financial arrangements because it gives the minister a wide power to decide on financial issues pertaining to mineral rights.

Proposals
27 (1) adequately provided for debt recovery hence sub 2 is unnecessary.

PART V & VI: Recognisance and prospecting licences

Section 31 (4) and 33 (3):
These are very firm provision, which will make it impossible for the minister to reject any application once the first application is granted. It is necessary to reiterate that the minister has no power to compromise a breach of law. A breach of law should be treated as a breach of law if due to certain reasons the minister omitted to perform an act that should not be the basis for treating an application with out consideration of performance under the previous contract.

Proposals
Section 31 (4) and 33 (3) should be cancelled because it is improper to say that the mining companies can breach the terms of a contract without impunity. The applicants have obligations to imply with the terms of the contract and once there has been an infringement, it must be a factor to be considered before granting an extension on the mineral license.

PART VII: Mining lease

Section 39 (3) (b):
This reflects the provision in section 31 (4) and 33 (3) in which the onus is put on the minister to perform and act. Section 39 (3) (b) is an outrageous provision because it is to the effect that an applicant must suffer for his or her default and not the people or the minister as the case may be. Section 31, 33, 39 portrays that the minister has little room for rejecting an applicant and must proof under prescribed circumstances reasons for its decision.

Proposal
The minister should have powers of outright rejection and there should be no need for arbitration as provided in subsection 39 (3). Section 39 (3 ) & (4) should be deleted.

Section 43
This section confers rights on mining companies to stock or dump mineral or waste product. It does not provide for any precaution these waste products may have on the environment and consequently on the society.

Proposal
Provisions regulating the exercise of the rights conferred by section 43 should be spelled out either in the act itself or in the subsidiary legislation compelled by the act.
The subsidiary legislation should be considered alongside the minerals and mining bill.

Section 45:
The stability agreement gives unequal treatment to mining companies who are also companies' registered under the laws of Ghana like any other company. This amounts to unfair discrimination of the non-mining companies. This is in contravention of non-discriminatory provision (ARTIC LE 17 equality clause in the bill of rights in the Ghanaian constitution) of the constitution.

Stability agreements do not take account of the dynamics of industry. Economic situations can change for better or worse.

Proposal
There should be no stability agreements.

Section 46: The Company has to simply propose a development plan that involves half a billion dollars or more to the government to enter into a development agreement. For instance while the law provides for dispute settlement procedures, an investment agreement of half a billion dollars, can assert a different dispute settlement procedure, different from the procedure provided by the law. The section also discriminates in favour of large companies.

Proposal
The mere mention of a half a billion dollars should not be a factor for disregard of the mining law by the minister. Section 46 should not form part of the Bill.

Section 47: This provision is too weak. There is no commitment mechanism for hiring and training Ghanaian by the MCs. There is no standard of measurement for employment.

Proposal
There should be a provision for a penalty should a MC fail to submit to the Commission a detailed program for the recruitment and training of Ghanaians. The companies should furnish evidence that there are no qualified Ghanaians and West Africans to take up a job before it is available to expatriates (expatriates meaning people from the west Africa region).

Section 51: The fine for change of ownership is too small. There is need to work extensively on section 51 -56 because companies change names and incorporate them selves as new companies to benefit from the tax free incentives.

Proposal
Hence there should be a rigid mechanism to regulate change of control of mining leases.

PART X: Surface and rights of compensation

Section 68: This provision is vague because it does not give a concise meaning of a "lawful occupier". The compensation system needs to be reviewed radically. The key issue here is the need for a new social accounting that takes into account the cultural values of displaced communities. A proper survey can facilitate the social accounting process and compensation issues can be resolved as part of the licensing approval process. Compensation issues cannot be an afterthought to be resolved later between the government and the communities.

Proposal
The cultural and social value of different locations can be established in a socio economic survey that should accompany the geological survey for the bill. Many district assemblies are already gathering such data and this can be a contribution. The government of Ghana can inform MCs upfront with what magnitude of compensation cost to expect.
The scale of the Land Valuation Board has to be upgraded upgraded.
Mining operations should not be allowed to proceed until after compensation issues have been settled.

Section 69 (6): This is an abuse of the principle of separation of powers between the executive and the judiciary. This is an issue to be addressed by the court.

Proposal
The minister should not play a quasi-judicial role in settling compensation disputes.

Section 70 (f) does not recognise cultural values.
Proposal
Cultural values of lands have to be recognised and compensated

Section 71: (1) This is very tricky and sounds confusing. All citizens of the land must have equal access to the courts. There must be judicial redress in all-environmental matters according to Rio Principe declaration article 10. Under subsection (3) the high court is exercising its supervisory jurisdiction. By implication a person dissatisfied by the minister's decision cannot go to court. In other words, one cannot appeal against a minister's decision. By the mere fact that the matter has been dealt with by the minister will practicably preclude a person from going to court under section 71. Section 71 limits the right to access to justice.

Proposal
Community members should not be precluded to going to court after the minister's decision, for they may be dissatisfied with the decision and may want to take the matter further.

Furthermore the use of the word "shall is not appropriate. We request that "shall" be substituted with "may".

Section 71 (3) A supervisory decision is not sufficient to address this problem.

PART XIII: Administration and miscellaneous provisions

Section 97: There is not strict division of functions between the Minerals Commission and the Inspectorate of Mines.

Proposal
To ensure accountability and transparency, the Inspectorate of Mines must be distinct from the Mineral Commission

Section 98: This section seeks to oust the jurisdiction of the EPA. The Mines Inspectorate does not have the capacity to do environmental monitoring.

Proposal
Only the EPA should monitor issues of environmental concern.

Section 101: This section does not does not put a strong obligation for such companies as describe to use Ghanaian products and materials.

Proposal
Companies in this category should be made to report on its implementation of this section. It would be an alternative to look at the concept of reporting and notification as a means of accessing relevant information.

APPENDIX

LIST OF ORGANISATIONS OF THE NATIONAL COALITION ON MINING

(NCOM)

1. Third World Network-Africa (TWN-Afr)
2. Centre for Public Interest Law (CEPIL)
3. Centre for Environmental Law and Development (CELD)
4. Civic Response (CR)
5. Wassa Association of Communities Affected by Mining (WACAM)
6. Friends of the Nation
7. Grass Roots-Africa
8. Friends of the Earth Ghana, (FOE-Ghana)
9. Forest Watch-Ghana
10. Crisis Action Solutions (CASOLS)
11. ABANTU for Development
12. Integrated Social Development Centre (ISODEC)