Serbia mining law impacts and local effects, ministry will adopt investors suggestions on exploration rights?

15. March 2013. / Mining

Dragan Jovanovic, President of Topola Municipality, warns that local governments will lose right to make decisions about mineral research and exploitation on their territory with adoption of the new law for geological research and mining.

State took control over all research and mineral exploitation of strategic significance. It tightened conditions by obligating investors to enter strategic partnership with republic and taking over power to make decisions and take incomes from minerals on their territory from local governments. Investors, expert public and municipal representatives criticized these innovations, planned with the draft of new law for mining and geological research.

Despite the speculations that law will be withdrawn from procedure in the office of Milan Bacevic, Minister of Natural Resources, Mining and Spatial Planning, that won’t happen- it was said to “Politika”. Only complains and suggestions that refer on strategic partnership, certain guaranties and fees will be accepted. They will be taken into text of the final law version and it should be presented to public in seven days.

Investors thought that the new law can influence further investments in the mining sector negatively because the relation between investor and state is not clearly defined. They believe that it supposes to be known how big investment is in order to do safer business and be able to return invested assets.

Tomislav Subaranovic, State Secretary in this Ministry, announces that the article 11, which refers to this, will be changed.

-I can’t say how it will sound exactly, because it is in the phase of preparation. The new draft of the law for mining and geological research will accommodate investors and their position will be improved- Subaranovic promises.

With this accommodation to investors, state takes jurisdiction from municipalities. Dragan Jovanovic, President of Topola municipality warns that local governments will lose power to make decisions and take incomes from fees.

-Nobody will ask anything about exploitation of minerals on Vencac Mountain and mineral water “Knjaz Milos”. All money from fees will go to republic cashbox and we’ll keep the overage of employees that issued contents and permissions. If investor wants to build factory for nickel processing on our territory, we won’t decide where it will be placed or how big area it will cover- Jovanovic claims.

On the other side, Subaranovic reminds that local governments are obligated to issue permissions for geological research performance, exploitation, mining work and geological and mining inspection, according to the currently valid law.

Only 9 of 123 local municipalities have confirmed that they will take over this work. The rest of them returned it to the Ministry of Natural Resources, Mining and Spatial Planning.

-This is the only reason why it was proposed in the draft of new law for geological research that local governments shouldn’t do mentioned work. However, the act of state body in charge of urbanism is still required with request for exploitation field approval i.e. exploitation. Defense of the Environmental Influence Estimation Study will remain public in municipalities where excavation is placed- Subaranovic claims and adds that this was proposed because of more efficient and faster subject resolving.

He stressed that fees for geological research and fees for use of minerals won’t be subject of this law draft, the will be placed in the law for fees.

Mining rent must be selective and it depends on mineral- it was emphasized in Serbian Chamber of Commerce. The scale of mining rent needs to be progressive and functionally depended on investment’s height and safety.

However, State Secretary in the Ministry of Natural Resources, Mining and Spatial Planning says that “there won’t be any surprising increase of fees for minerals consumption so companies and investors won’t be endangered”.

-The law defines base and upper limit for mineral fee height determination, so called mining rent fee. Influence of mining rent fees on business of companies from these areas and prices on Serbian or appropriate world market will be considered in the adoption process of act that will determine the height of mineral rent fees.

Source Serbia Energy/Agencies/ Politika

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