18 July 2014

Kenya: Firms to Get Mining Licences Within 90 Days

MINING prospectors will be able to apply for licences online and get feedback within 90 days, according to new amendments to the Mining Bill.

The fresh amendments to the proposed mining law presented to Parliament in January also effectively cuts the Commissioner of Mines' power on licence issuance through a provision to set up a Mining Advisory Board to oversee the licensing process.

Mining Cabinet secretary Najib Balala said yesterday that the Bill tabled in Parliament early this year had gone through the first reading but before the departmental committee could present it for second reading, all parties concerned together with stakeholders in the sector met and proposed changes resulting in the negotiated Bill whose report was tabled on Wednesday.

"Under the law that we have tabled, role of the investor in terms of compliance, the CS and the mining committee have clearly been distinguished," Balala told journalists after attending a forum on taxation of the mining sector.

He said that through the online licensing system, "if you get a licence and fail to be compliant, it cuts you off automatically."

A taskforce that was appointed last year to probe issuance of mining licences found out that there was rampant corruption in the issuance which it partly attributed it to too much discretion at the hands of one individual - the commissioner of mines.

The report added that there was no criteria upon which that discretion was exercised leading to abuse of power.

The report recommended that proper structures be established to vet and issue licences to address the problem.

The taskforce had also unearthed licences issued to various speculators who had no intention of prospecting for minerals or mining but just wanted to sell their licences to the highest bidder.

Under the proposed law, provision has also been made to only allow tax-related incentives for companies with an investment of more than $500 million(Sh4.4 billion) to reduce abuse of these incentives and promote national interest.

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