Ordinance No. 541/2014 From DNPM’s Head Director

Author:Mr Luiz Fernando Visconti
Profession:TozziniFreire Advogados

It was published on the Official Gazette on December 19th, 2014, the Ordinance no. 541/2014, issued by the Head Director of the National Department of Mineral Production (DNPM). The new Ordinance establishes several new proceedings to be adopted by the mining companies before Brazilian Authorities, and changes several previous regulations, such as assignment of mining rights, issuance of permits for temporary extraction (Guia de Utilização – "GU") and the clearance of encumbered areas available for new miners, among others. The Ordinance will be enforceable on February 2nd, 2015 and will be valid for the proceedings already ongoing before DNPM, in accordance to their stages.

One of the main changes is related to the requirements for assignment of mining rights. From February on, the approval and annotation of the assignment before DNPM will be conditioned to the non-existence of outstanding debts inscription in regard to the Financial Compensation for Exploitating Mineral Resources (Compensação Financeira pela Exploração de Recursos Minerais – "CFEM").

On the other hand, if an installment program was initiated for the Annual Fee per Hectare (Taxa Anual por Hectare – "TAH"), this will not be a condition anymore for the denial of the assignment of mining rights. If there are TAH debts pending, the assignee can provide a debts assumption agreement, which will allow the assignment.

The issuance of GUs for temporary extraction of mineral substances before the mining concession is ruled was also subject of major changes. Besides the payment of a tax of BRL 5,000 (five thousand Brazilian Reais) by the miner, the DNPM will not issue new GUs in the case of...

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