OCBOCC’s Victor Angelo L Galura takes a close look at mining law in the Philippines, its development over the years and the greatest concerns facing mining companies in the nation.
What are the key regulations governing ownership of mineral rights in the Philippines?
The following are the primary laws that regulate the ownership of mineral rights in the Philippines:
- The 1987 Constitution, which provides that the exploration, development and utilisation of natural resources is reserved to Filipinos, whether natural persons or juridical persons;
- Republic Act 7942 (otherwise known as the ‘Mining Act’) as implemented by DENR Administrative Order 2010-21;
- RA 8371 Indigenous People's Rights Act, which protects the rights of indigenous cultural communities and indigenous peoples (ICCs/IPs) and entitles them to share the benefits from the exploration and exploitation of the mineral resources that are found in their ancestral domain;
- RA 7076, or the People's Small-Scale Mining Act of 1991, which regulates small scale mining done for subsistence purposes; and
- PD1899, which regulates small-scale mining done for commercial purposes.
More broadly, what are the significant laws surrounding health and safety in mining operations and who is allowed to work a mineral deposit?
In addition to the requirements under the Labor Code, the Mining Act also states that all contractors and entities are to strictly comply with safety rules promulgated by the Secretary. This includes DENR Administrative Order No. 2000-98, which provides for the safety and health standards in mining operations. The Mining Act also provides the minimum age of persons who are to be employed in any phase of a mining operation.
The Bureau of Working Conditions (BWC) also issues occupational safety and health standards which must be complied with by all employers in the country. Under these standards, the mining industry falls under the definition of a ‘hazardous workplace’ and must comply with these additional requirements:
- One full-time safety officer has to be appointed to the site for every one thousand (1000) workers. These safety officers are required to take training courses under the BWC.
- Mining operations also have to provide occupational health services, such as full-time occupational health physicians, a full-time dentist and an emergency medical clinic. Furthermore, the BSW also provides the minimum amount of medicines, medical supplies and equipment that must be kept within the establishment.
In your experience, where do conflicts regarding mining law typically emerge?
From our experience, most conflicts regarding mining laws arise from the issue of ownership over the land in which the minerals are found. Our Constitution provides that the state owns all minerals and other natural resources. It also explicitly provides that: “The exploration, development, and utilisation of natural resources shall be under the full control and supervision of the State.”
Notwithstanding the state ownership of the minerals, this does not completely do away with the rights of the owners of the land in which these minerals are present.
In the Philippine Mining Act, it is provided that “subject to prior notification, holders of mining rights shall not be prevented from entry into private lands and concession areas by surface owners, occupants, or concessionaires when conducting mining operations therein”. This being the case, the contractor authorised by the government to conduct mining operations cannot be prevented by the owners of private lands from mining there. However, these owners must be justly compensated for any damage to the property caused by said mining operations. Conflict arises when there is a disagreement on what would amount to just compensation for the damage done to the property.
In addition to this, if it is necessary to build, construct or install infrastructure on private land for mining operations, the contractor may build these on said private land, subject to the payment of just compensation.
Another point of conflict appears when the land containing the minerals is considered part of the ancestral domain of indigenous people. In this scenario, the Indigenous People’s Rights Act provides that “No ICCs/IPs will be relocated without their free and prior informed consent, nor through any means other than eminent domain. Where relocation is considered necessary as an exceptional measure, such relocation shall take place only with the free and prior informed consent of the ICCs/IPs concerned.”
From our experience, most conflicts regarding mining laws arise from the issue of ownership over the land in which the minerals are found.
What legal pitfalls should mining companies therefore be aware of when operating in the Philippines?
Mining companies should ensure they comply with all environmental regulations, including obtaining the necessary permits and licenses, conducting environmental impact assessments and implementing effective environmental management plans. Failure to comply with these regulations can result in fines, penalties, or even closure of operations.
Mining companies should be aware of the rights of indigenous communities and ensure that they are consulted and involved in decision-making processes related to mining activities on their ancestral lands. They should ensure they comply with all labour standards and respect human rights, including those of their workers and local communities.
In addition to the above, mining companies should ensure that benefit-sharing arrangements with local communities are fair and equitable and that local communities receive a fair share of the benefits generated by mining activities.
Finally, mining companies should be aware of the risks of corruption and bribery in the Philippines and ensure that they have effective anti-corruption policies and procedures in place.
In general, mining companies should be proactive in their approach to legal compliance and stakeholder engagement and work closely with local communities, governments and civil society organisations to ensure that mining activities are conducted in a responsible and sustainable manner.
Have you witnessed the practical or regulatory landscape of mining law change significantly during your time in practice?
The Philippine Mining Act of 1995 introduced significant changes to the regulatory landscape of mining law in the Philippines. The law required mining companies to conduct environmental impact assessments and implement environmental management plans, as well as introducing a revenue-sharing scheme to ensure that local communities benefit from mining activities.
In recent years, there have been several developments in the regulatory landscape of mining law in the Philippines. In 2012, the government implemented a moratorium on new mining permits and cancelled 75 existing permits due to concerns over environmental damage and social unrest. This was lifted in 2019, but stricter regulations on mining operations, including a requirement for mining companies to set aside funds for the rehabilitation of mining areas and the creation of a trust fund to benefit local communities are implemented. Disputes are usually over land rights, environmental damage, and alleged human rights violations by mining companies.
Mining companies should be aware of the rights of indigenous communities and ensure that they are consulted and involved in decision-making processes related to mining activities on their ancestral lands.
One of the more recent developments is the passing of DENR AO 2021-40, which lifted the ban on open-pit mining. However, this is still subject to restrictions which ensure that the operation of such project would not pose any hazard to public health and safety that might result from ground failure or physical deterioration.
Can you tell us about any current trends or developments that you are witnessing in the mining industry?
Increased global demand for minerals has led to increased exploration and mining activities in the Philippines, particularly in areas with high mineral potential.
As a counterpoint, there is a growing emphasis on responsible and sustainable mining practices in the Philippines, driven by concerns over environmental damage and the negative social impacts of mining activities. This has led to the development of stricter regulations and standards for mining operations, as well as increased scrutiny from civil society groups and the public.
The mining industry in the Philippines is increasingly using technology and innovation to improve efficiency and reduce the environmental impact of mining activities. This includes the use of drones and other remote sensing technologies to conduct exploration and monitoring, as well as the adoption of cleaner and more sustainable mining processes. Notwithstanding this, small-scale mining is still widely practiced in the country and is expressly allowed under the law.
There is a growing focus on community development in the mining industry in the Philippines, with mining companies working to engage and empower local communities and ensure that they benefit from mining activities. This includes the implementation of benefit-sharing arrangements and the provision of education, health and infrastructure projects in mining-affected communities.
The industry is working to balance economic growth with responsible and sustainable practices, while addressing the needs and concerns of local communities and stakeholders.
Victor Angelo L Galura, Associate
Ortega, Bacorro, Odulio, Calma and Carbonell Law Office (OCBOCC)
Ortega Bacorro Odulio Calma & Carbonell
140 L.P. Leviste St., Salcedo Village 1227 Makati City, Philippines
Tel: +63 28818-2321
Fax: +63 28810-3153
Victor Angelo L Galura is an associate at OCBOCC. He was first admitted to practice law in the Republic of the Philippines in 2017 and his practice covers immigration, corporate law, labour law, IP, mining law and civil and criminal litigation. In addition to his broad experience, he is fluent in both English and Filipino.
OCBOCC has a diversified general law practice and works alongside leading law firms in major cities around the world. It handles all aspects of corporate, commercial and international business transactions, protection and enforcement of intellectual property rights, technology transfers, civil and criminal litigation, admiralty, labour-management relations, taxation, aviation law, estates and trusts, media law, immigration and family law.
