The Mining (Amendment) Bill, 2023
Status Timeline
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Executive
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Final
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Establishment of the Mining Regulatory Authority
Establishes a new Mining Regulatory Authority under Section 30 to replace the advisory Mineral Rights Board. This body corporate will:
- Regulate the exploration, extraction, production, processing, refining, transport, storage, and sale of minerals.
- Issue, renew, modify, suspend, or revoke mining licenses and permits.
- Impose administrative fines up to KSh 100,000 per day for compliance violations.
Establishment of the Mining Rights Tribunal
Establishes the Mining Rights Tribunal under Section 31N to hear disputes. Key features include:
- A chairperson nominated by the Judicial Service Commission who is qualified to be a High Court judge.
- Jurisdiction to hear appeals from any person aggrieved by decisions of the Authority regarding licensing, fees, or mining rights.
- Power to confirm, set aside, or vary decisions, with further appeals directed to the High Court within 14 days.
Artisanal Mining Capital and Depth Thresholds
Amends Section 4 of the Act to introduce clear definitions for artisanal mining operations:
- Must be carried out by a person, group, or cooperative using basic equipment without formal training.
- Capital investment must not exceed KSh 1 million.
- Vertical depth of exploration or excavation is capped at thirty meters.
Fines Up to KSh 1 Million for Obstructing Mining Inspectors
Amends Section 205 to strengthen enforcement of compliance monitoring. Anyone who hinders, obstructs, or fails to comply with orders issued by a mining inspector faces:
- Imprisonment for a term not exceeding three years.
- A fine of not less than KSh 1 million.
- Or both penalties simultaneously.
Bill No.
No. 51 of 2023
Gazette No.
Supplement No. 149 of 2023
Sponsor
David Gikaria
Background
The Mining Act (No. 12 of 2016) currently converges sector policy formulation, day-to-day administration, and dispute resolution under the Cabinet Secretary and the advisory Mineral Rights Board. This structure has created regulatory challenges and administrative delays. The Mining (Amendment) Bill, 2023 proposes to separate these functions to enhance transparency and compliance by establishing dedicated administrative and dispute resolution bodies.
Key Amendments
Decoupling of Sector Roles
- The Cabinet Secretary: Relieved of day-to-day licensing and administrative duties, focusing instead on policy direction and strategic recommendations.
- Mining Regulatory Authority: Takes over the day-to-day administration, regulation, and enforcement of mining operations in Kenya.
- Mining Rights Tribunal: Takes over judicial and dispute resolution functions from the Cabinet Secretary and courts of first instance.
Mineral Royalty Sharing
Amends Section 183 to mandate the distribution of royalties won by virtue of a mineral right as follows:
- Seventy percent (70%) to the National Government.
- Twenty percent (20%) to the County Government.
- Ten percent (10%) to the local community where mining operations occur.
New Obligations
Consent and Compensation
- Applicants for mining rights must secure express consent from private landowners (Section 37) or community land administrators (Section 38) prior to commencing operations.
- Mining operators are required to deposit an environmental protection bond and compensation guarantee bonds (Section 181) to cover land restoration obligations.
Local Equity and Content
- Large-scale mining license holders are required to submit a detailed program for recruiting and training Kenyan citizens to encourage local capacity building (Section 46).
- Licensees with planned capital expenditures exceeding prescribed limits must float at least twenty percent (20%) of their equity on a local stock exchange within three years of commencing operations (Section 49).
Penalties
- Conflict of Interest: Any member of the Authority's Board who fails to disclose a direct or indirect interest in a matter before the Board faces a fine of up to KSh 500,000, imprisonment for up to seven years, or both (Third Schedule, paragraph 11).
- Offences Relating to Inspection: Hindering an inspector, refusing to produce documents, or providing false information carries a prison term of up to three years, a fine of not less than KSh 1 million, or both (Section 205).
- Administrative Compliance Fines: The Authority may impose daily fines of up to KSh 100,000 for licensing violations, up to a maximum of thirty days (Section 31A).
Transitional Provisions
- The Chairperson and members of the former Mineral Rights Board will be transitioned to the Board of the Mining Regulatory Authority for their remaining unexpired terms.
- Any staff currently serving under the Mineral Rights Board are transitioned to the new Authority.
- Existing orders, permits, licenses, or notices issued by the Cabinet Secretary or Director of Mines prior to this Amendment will remain valid and active.
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