On April 28, 2005 , it was published in the Official Gazette published a decree by means of which diverse provisions of the Mining Law are amended. Some of these modifications to the Mining Law tend to replace the institution of the Mineral Resources Counsel under a new denomination which is Mexican Geological Service, that being a decentralized entity, has the fundamental function of acting as generating and depositary instance of public information regarding geology, geophysical, geochemistry and mining matters of the country. With these changes, the redefinition and enlargement of functions of the Counsel as Mexican Geological Service were sought.
In the reform the authority updated and complemented the different names of the chemical elements that can be extracted from minerals, as well as the minerals of industrial use. Some materials are subject of concession for their subterranean exploitation, such as the clays and varieties of mineral coal. On the other hand, certainty is given to the use of saltines and minerals. Including exploration and exploitation under the protection of a concession granted according to Law.
Another object of the reform is the administrative simplification of procedures. The figure of the joint concession for the exploration and exploitation of minerals or substances is contemplated. These concessions are granted for a term of 50 years that can be extended in equal term.
The legislator also contemplates a solution to the free lands surrounded by lands protected by mining concessions which are called holes. The procedure and rules for the granting of concessions for exploration and exploitation of these lands were regulated, giving preference to the concessionaires that surround these lands. Likewise, there are variations in the concept of free land, as in the Mexican marine zones case, that now are considered as such.
Reforms regarding incorporation of subterranean servants in the mining lots are included, by virtue of own composition and natural location of the deposits. In case of construction and minerals exploitation and exploration works or substances in lands protected by petroleum assignments, the obligation to request technical opinion to the Ministry of Energy was eliminated, except in coal and all its varieties.
Another intention of the legislators was the integration and optimization of a more complete database of concessionaires. From now on, the concessionaries should present a report to the Ministry of Economy in case of cancellation, termination and withdrawal, replacement by reduction, infraction or judicial resolution of the mining concession. These reports should be delivered by the Ministry of Economy to the Mexican Geological Service in order to integrate it, in the public system of information. On the other hand, the obligation is included to the concessionaires that have obtained these concessions by public offer, the concessionaries will submit to the Mexican Geological Service a semiannual report on activities carried out and production obtained during the term, to consider the payment of discovery bonus or any other economic consideration.
The reforms have also a labor spirit; from now on concessionaires have the obligation to appoint a legally authorized engineer as responsible for the fulfillment of the norms of security in the mines, when more of nine workers are involved in the mines of coal and forty-nine in the other cases.
A new provision is included in the reform and indicates that it is a right of the concessionaire to claim before the competent judicial authority, the illegal extraction and the recovery of the minerals inside the mining lots protected.
Nevertheless, updates the applicable sanctions by infraction to the new obligations that concessionaires acquire. Currently the cancellation of mining concessions proceeds when the concessionaire doesn't present the semiannual report before Mexican Geological Service; or when the exploration and exploitation activities of coal in all its varieties do not comply with the technical conditions set by the Ministry of Economy.
For more information on the reform content and its implications, as well as of the services we can lend you based on the reforms, do not hesitate to contacts us.
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