Making Brazilian industry more competitive, innovative and sustainable, with the possibility of generating new investments and increasing Brazil's GDP. According to President Michel Temer, these will be the result of three provisional measures (a form of executive order) for modernisation of the mining sector signed this Tuesday (25) during a ceremony in the Presidential Palace.

“We are taking a decisive step towards more modern laws and institutions for the mining sector to attract new investments," said the president. "Naturally we are talking about - and want to continue to talk about - a competitive, innovative and sustainable mining industry that requires an updated regulatory framework," he added.

According to the president, the new legal framework takes Brazil into the 21st century. The three provisional measures are part of the Brazilian Industry Revitalisation Programme, the most complete overhaul of the sector since the 1990s. The objective is to increase legal certainty, bring more investments and remove hurdles from mining activity.

“We have taken a decisive step to modernise laws and institutions of the mining sector to attract new investments; as was said here, for over 20 years there have been no legislation changes of this magnitude for the mining sector in Brazil," Temer said.

New rules

Signed today by Temer, the provisional measures make adjustments to the Mining Code, create a regulatory agency and also modify the amounts paid for mining rights. With these changes, the Ministry of Mines and Energy estimates that the share of mining in the Gross Domestic Product (GDP) will increase from 4% to 6%.

A new regulatory watchdog, the National Mining Agency (ANM), is being created to replace the National Department of Mineral Production (DNPM), the latter an autonomous agency linked to the Ministry of Mines and Energy. The measure also established that an annual contribution will be collected from mining projects (varying from R$ 500 s R$ 5,000) to fund the regulatory and supervisory activities of the new agency.

Meanwhile, mining royalties - the amounts collected by by the country in exchange for the right to explore ores in the territory - will be simplified and updated. The rate for iron one will vary according to international prices up to a ceiling of 4%, while royalties for minerals used in civil construction will be reduced from 2% to 1.5%.