1 Legal and regulatory framework

1.1 Which legislative and regulatory provisions govern mining in your jurisdiction?

The Mining Code, established by Law 036-2015/CNT dated 26 June 2015, is the main statute governing mining in Burkina Faso.

Law 028-2017/AN dated 18 May 2017 on gold marketing and other precious metals (the Law on Gold) is also applicable.

In addition, and without being exhaustive, numerous decrees and orders have been adopted to implement the Mining Code, including the following:

  • Decree 2017-0068/PRES/PM/MEMC/MEEVCC/MINEFID/MATDSI dated 15 February 2017 relating to the rehabilitation fund and closure of mines;
  • Decree 2017-0047 dated 1 February 2017 on the rehabilitation fund, artisanal mining sites and the fight against the use of prohibited chemicals;
  • Decree 2017-0035/PRES/PM/MEMC/MINEFID/MCIA/MATDSI/MJFIP/MFPTPS/MEECVV dated 26 January 2017 pertaining to the mining agreement template (‘Decree 2017-035');
  • Decree 2017-0036/PRES/PM/MEMC/MATDSI/MINEFID/MEEVCC/MCIA dated 26 January 2017 on mining permits and authorisations;
  • Decree 2017-034 dated 26 January 2017 on the fund for the financing of geological and mining research;
  • Decree 2017-0023/PRES/PM/MEMC/MINEFID dated 23 January 2017 on taxes and royalties;
  • Decree 2017-0024 dated 23 January 2017 on the mining fund for local development;
  • Decree 2007-901/PRES/PM/MCE/MS/MTSS dated 31 December 2007 on health and safety in the mining sector (Decree 2007-901);
  • Order 2018-018 dated 20 June 2018 on standard models of specifications for holders of authorisations for artisanal and semi-mechanised mining of quarry substances; and
  • Order 2018-019 dated 20 June 2018 on specifications for holders of semi-mechanised mining permits and authorisations for artisanal mining.

1.2 When was the mining legislation last reviewed?

The mining legislation was last reviewed in 2018 with the adoption of the orders set out in question 1.1.

1.3 What other legislative and regulatory provisions have relevance for mining operations in your jurisdiction?

Without being exhaustive, the following legislative and regulatory provisions also have relevance for mining operations in Burkina Faso:

  • the Environmental Code established by Law 006-2013/AN dated 2 April 2003;
  • Law 009-2018/AN dated 3 May 2018 on expropriation; and
  • the General Tax Code.

1.4 Are there any regional treaties or laws that need to be taken into account?

The West African Economic and Monetary Union foreign exchange regulation (ie, Regulation 09/2010/CM/UEMOA) should be taken into account.

1.5 Which bodies are responsible for enforcing the applicable mining laws and regulations? What powers do they have?

The following bodies are responsible for enforcing the applicable mining laws and regulations:

  • Ministry of Mines: The Ministry of Mines – through its agents – ensures that the provisions of the Mining Code are complied with. These agents can intervene at any stage of a given mining activity (eg, during the exploitation phase). Without being exhaustive, these agents have a remit that includes the power:
    • to ensure that safety measures taken at a given site are appropriate;
    • to access a given site in order to ensure that no violations of the provisions of the Mining Code are occurring; and
    • to obtain copies of documents at a given site.
  • Police officers: The main tasks of police officers include investigating potential violations of the Mining Code and establishing the existence of these violations.
  • Agents of the Ministry of Environment and of specific territorial subdivisions: Like agents of the Ministry of Mines, these ensure compliance by operators with their environmental obligations.

1.6 What is the regulators' general approach in regulating the mining sector?

In regulating the mining sector, the Burkinabe regulators pay special attention to the following objectives:

  • maximisation of state revenues;
  • community development;
  • proper management and rehabilitation of the environment;
  • promotion of the supply of local goods and services;
  • creation of jobs and valorisation of national skills; and
  • proper governance of the mining sector.

2 Mining industry

2.1 How mature is the mining industry in your jurisdiction?

The mining industry in Burkina Faso may be considered as mature. Mining activities have been carried out in the country for years and many operators are active in the country. In addition, the Burkinabe authorities seem to have a good understanding of the mining industry.

2.2 What are the key minerals which are mined in your jurisdiction and where is mining activity typically based?

Gold is the primary key mineral mined in Burkina Faso.

Without being exhaustive, the main regions/areas in which mining activity is conducted are Sahel and Boucle du Mouhoun.

2.3 Are any minerals deemed strategic and, if so, what impact does this have?

Gold is considered strategic and the revenues that the Burkinabe state derives from this mineral are significant.

2.4 Who are the key players in the mining industry in your jurisdiction?

The key players in the mining industry in Burkina Faso are as follows:

  • Ministry of Mines: Please see question 1.5.
  • Mining operators: An example of a key player is Iamgold Essakane SA, which operates the Essakane mine, the largest gold mine in the country.
  • Civil society: Numerous organisations are active in Burkina Faso, including non-governmental organisations (NGOs). In some cases, an NGO (eg, NGO Orcade) has denounced the non-compliance of operators with the Mining Code and asked local communities to refuse to collaborate with mining companies.

2.5 In addition to exploration rights and mining rights, what other mining rights and titles exist (eg, artisanal or small-scale mining rights)?

The other mining rights and titles that exist in Burkina Faso are as follows:

  • large-scale and small-scale industrial operating permits;
  • semi-mechanised operating permits;
  • artisanal mining authorisations; and
  • quarry operating authorisations.

3 Exploration rights

3.1 What licences are required to undertake prospecting and exploration activities in your jurisdiction? Do these vary depending on the type of mineral or the location of the activity?

Prospecting activities: Prospecting activities are subject to the grant of a prospecting authorisation. The minister of mines issues prospecting authorisations.

Any type of mineral can be covered by a prospecting authorisation. However, when it comes to radioactive mineral, a prospecting authorisation cannot be issued without a favourable opinion of the Burkinabe authorities in charge of radioactive matters. The location of the activity has no particular relevance when it comes to the issuance of a prospecting authorisation, except that:

  • there are certain designated areas in which prospecting activities are forbidden; and
  • areas already covered by an exploration permit or a mining permit cannot be used for prospecting purposes (unless expressly authorised in writing by the holder of the exploration/mining permit).

Exploration activities: Exploration activities are subject to the grant of an exploration permit. The minister of mines issues exploration permits.

Any type of mineral may be covered by an exploration permit, with the exception of minerals found in quarries which are subject to an authorisation The location of the activity has no particular relevance when it comes to the issuance of an exploration permit, except that:

  • there are designated areas within which exploration activities are forbidden; and
  • areas already covered by another exploration permit or a mining permit cannot be used for exploration purposes (unless the mining permit is an artisanal mining permit).

3.2 What requirements must be satisfied to obtain a licence?

Prospecting authorisation: The procedure set out question 3.3 must be followed. In addition, the relevant individuals at the mining registry will pay special attention to:

  • whether the mining area requested is already covered by an exploration/mining permit;
  • the nature of the planned work; and
  • whether the relevant taxes have been paid.

We understand that these are the most important requirements that need to be met.

Exploration permit: The procedure set out in question 3.3 must be followed. In addition, the relevant individuals at the mining registry will pay special attention to:

  • the nature and extent of the planned exploration work;
  • minimum annual expenditures per square kilometre; and
  • whether the relevant taxes have been paid.

We understand that these are the most important requirements that need to be met.

3.3 What is the procedure for obtaining a licence? How long does this typically take?

Prospecting authorisation: The procedure to obtain a prospecting authorisation is discussed below. It generally takes 30 days in total; although this is subject to administrative delay, which is not uncommon in Burkina Faso.

The first step is to submit an application for a prospecting authorisation to the Mining Registry. The dossier should contain the following documents and information:

  • For individuals:
    • a written request (properly stamped) addressed to the minister of mines;
    • the applicant's name, first name, nationality, job and address;
    • the representative's name, first name, address and qualifications;
    • the minerals for which the prospecting authorisation is requested;
    • the surface/size of the mining area that is requested;
    • a topographic map (scale of at least 1/200,000) localising the area requested and outlining its limits; and
    • a note detailing the purpose of the prospection, to which is annexed a work programme pertaining to the validity period of the prospecting authorisation.
  • For legal entities:
    • a written request (properly stamped) addressed to the minister of mines;
    • a copy of an extract from the companies register (or any other equivalent document);
    • the representative's name, first name, address and qualifications;
    • the minerals for which the prospecting authorisation is requested;
    • the surface/size of the mining area that is requested;
    • a topographic map (scale of at least 1/200,000) localising the area requested and outlining its limits;
    • a certificate of non-insolvency; and
    • a note detailing the purpose of the prospection, to which is annexed a work programme pertaining to the validity period of the prospecting authorisation.

The relevant individuals at the Mining Registry are entitled to request additional documents and information from the applicant, where necessary.

Once the dossier is submitted, a deposit slip is given to the applicant or its representative.

The applicant's request is then analysed. If the application is rejected, the applicant will receive notification, setting out the reason for the rejection. If the application is likely to be accepted, a registration certificate will be given to the applicant.

Finally, the minister of mines will issue the prospecting authorisation via an order.

Exploration permit: The procedure to obtain an exploration permit is outlined below. This generally takes 60 calendar days, starting from the issuance of a registration certificate as discussed below. However, this is subject to administrative delay, which is not uncommon in Burkina Faso.

The first step is to submit an application for an exploration permit to the Mining Registry. The dossier should contain the following documents and information:

  • For individuals:
    • a written request (properly stamped) addressed to the minister of mines;
    • the applicant's name, first name, nationality, job and address;
    • an extract of the criminal record (issued within the last three months of the submission);
    • the representative's name, first name, address and qualifications;
    • the minerals for which the exploration permit is requested;
    • the surface/size of the mining area that is requested;
    • a copy of the payment receipt pertaining to submission fees;
    • a topographic map (scale of at least 1/200,000) localising the area requested and outlining its limits; and
    • the work programme that the applicant plans to carry out during the first year of validity of the exploration permit and the corresponding budget.
  • For legal entities:
    • a written request (properly stamped) addressed to the minister of mines;
    • a copy of an extract from the companies register (or any other equivalent document);
    • the representative's name, first name, address and qualifications;
    • the minerals for which the exploration permit is requested;
    • the surface/size of the mining area that is requested;
    • a topographic map (scale of at least 1/200,000) localising the area requested and outlining its limits
    • a certificate of non-insolvency;
    • a copy of the payment receipt pertaining to submission fees; and
    • the work programme that the applicant plans to carry out during the first year of validity of the exploration permit and the corresponding budget.

The relevant individuals at the Mining Registry are entitled to request additional documents and information from the applicant, where necessary.

On submission of the dossier, a deposit slip and a registration certificate are given to the applicant or its representative.

The applicant's request is then analysed, and is either accepted or rejected. If the request is rejected, the applicant will receive written notification, setting out the reasons for rejection. If the request is accepted, the applicant will also be notified in writing.

Finally, the minister of mines will issue the exploration permit via an order.

3.4 Who can own exploration rights in your jurisdiction? Do specific requirements or restrictions apply to foreign operators?

Individuals and legal entities can own mining rights in Burkina Faso. There are neither specific requirements nor restrictions per se that apply to foreign operators.

3.5 What fees and other charges are incurred in obtaining a licence?

The fees and charges that are incurred in obtaining a prospecting authorisation and an exploration permit are set out below:

  • Fixed fee:
    • Prospecting authorisation: XOF 1 million (approximately $1,650) for uranium and XOF 200,000 (approximately $330) for other minerals.
    • Exploration permit: XOF 5 million (approximately $8,300) for uranium and XOF 2 million (approximately $3,300) for other minerals.
  • Application fee:
    • Prospecting authorisation: XOF 10,000 (approximately $17).
    • Exploration permit: XOF 10,000 (approximately $17)

3.6 What is the duration of a licence? What is the process for renewal?

Prospecting authorisation: The duration of a prospecting authorisation is one year. It is renewable once for a further period of one year.

The renewal process is summarised below. This process should take 30 days in total; although this is subject to administrative delay, which is not uncommon in Burkina Faso.

The first step is to send an application for renewal to the minister of mines at least 30 days before the expiry of the prospecting authorisation. The dossier should contain the following documents and information:

  • a written request (properly stamped);
  • a copy of the prospecting authorisation (whose renewal is sought); and
  • a report on the results of the prospecting conducted during the last validity period of the prospecting authorisation and the work programme planned for the next validity period.

The relevant individuals at the Mining Registry may request additional documents or information from the applicant, where necessary.

The applicant's request for renewal of the prospecting authorisation is then analysed. If the application is rejected, the applicant will receive notification, setting out the reasons for the refusal. If the application is likely to be accepted, a registration certificate will be issued to the applicant.

Finally, the prospecting authorisation is renewed through an order of the minister of mines.

Exploration permit: The duration of an exploration permit is three years. It is renewable twice for a period of three years for each renewal.

The renewal process is summarised below. This process should take 90 days in total; although this is subject to administrative delay, which is not uncommon in Burkina Faso.

The first step is to submit an application for renewal to the Mining Registry at least 90 days before the expiry of the exploration permit. The dossier should contain the following documents and information:

  • a written request (properly stamped) addressed to the minister of mines;
  • a copy of the exploration permit (whose renewal is sought);
  • a general report on all exploration conducted during the validity period of the exploration period, including the results of the work done, plans and so on;
  • evidence that the applicant is up to date in terms of payment of taxes and royalties; and
  • the work programme planned for the following year and the corresponding budget.

The relevant individuals at the Mining Registry are entitled to request additional documents and information from the applicant, where necessary.

The applicant's request for renewal of the exploration permit will then be analysed and a registration certificate will be issued to the applicant.

If the request is rejected, the exploration permit will be withdrawn by order of the minister of mines. This order will set out the reasons for the withdrawal. If the request is accepted, the renewal of the exploration permit will be notified to the applicant. The renewal will take the form of an order of the minister of mines.

3.7 What are the operator's rights and obligations under the licence?

Prospecting authorisation: The obligations of an operator under a prospection authorisation are as follows:

  • not to transfer the prospecting authorisation;
  • to preserve human rights;
  • not to carry out exploration or exploitation activities within the area covered by the prospecting authorisation; and
  • not to suspend prospecting activities (without a valid reason) for more than 90 days.

The right of an operator under a prospection authorisation is a non-exclusive prospecting right over all minerals within the mining area attributed to the operator.

Exploration permit: The obligations of an operator under an exploration permit are as follows:

  • to comply with all regulations pertaining to the protection of:
    • the environment; and
    • archaeological and cultural sites;
  • to inform local authorities of:
    • its arrival at and departure from a given site; and
    • the nature of the activities to be carried out by its staff on a given site;
  • to provide an annual report on work done to the Ministry of Mines, containing information on cartography, sampling and so on;
  • to commence exploration activities within six months of the issuance of the exploration permit;
  • to carry out the exploration activities diligently; and
  • to preserve human rights.

The rights of an operator under an exploration permit are as follows:

  • an exclusive exploration right over minerals specified in the exploration permit, within the mining area that has been attributed to the operator;
  • the right to use minerals that have been extracted for exploration purposes;
  • the right to apply for an extension of its exploration permit to (the exploration of) other minerals, within the mining area that has been attributed to the operator;
  • the right to apply for an extension of the area covered by the exploration permit; and
  • the exclusive right to apply for an exploitation permit (during the validity period of the exploration permit) if minerals are discovered within the mining area that has been attributed to the operator.

In addition, the operator's specifications may contain other rights and obligations.

3.8 Are there any requirements re relinquishment of an exploration licence or part of the area covered by an exploration licence?

Under the Mining Code, the second renewal of an exploration permit results in the reduction by one-quarter of the area covered by the permit.

The holder of an exploration permit can also reduce the area covered by the permit upon its first renewal. To this end, the holder of the exploration permit must submit the following documents with the renewal dossier (please see question 3.6):

  • the new perimeter of the area covered by the exploration permit; and
  • a map (scale of at least 1/200,000) that sets out the new perimeter.

The letter of the law is not entirely clear on whether, under the above two scenarios, the prior approval of the Ministry of Mines is required in the form of an order of the minister of mines. However, we understand that this requirement must be met when it comes to relinquishments that do not fall within these two scenarios – that is, any other relinquishment of all or part of an area covered by an exploration permit is subject to the prior approval of the minister of mines.

3.9 Can licences be transferred? If so, how and subject to what consents? Do any restrictions or taxes apply to direct or indirect transfers?

Prospecting authorisation: A prospecting authorisation cannot be transferred.

Exploration permit: An exploration permit can be transferred. However, the transfer is subject to the approval of the minister of mines. The transfer process is summarised below.

The first step is to submit a request to the Ministry of Mines. The following documents and information must be provided:

  • a request for transfer (properly stamped);
  • a copy of the exploration permit to be transferred;
  • a transfer agreement that:
    • is properly executed by the parties to the agreement;
    • sets out the transfer price; and
    • is registered with the tax authorities;
  • an undertaking by the transferee evidencing that it will carry out the ongoing work programme;
  • a report on the exploration activities that have been carried out in the area covered by the exploration permit and the results of the work;
  • audited accounts pertaining to the expenses incurred with respect to the exploration activities;
  • a note on the technical and financial abilities of the transferee; and
  • documents pertaining to the transferor.

The relevant individuals at the Ministry of Mines may request additional documents and information from the applicant, where necessary.

The Ministry of Mines will then analyse the transfer request, which will be rejected or authorised. Authorisation takes the form of an order of the minister of mines.

The transfer of an exploration permit is subject to the following taxes:

  • a fixed fee of XOF 15 million (approximately $25,000) for uranium and XOF 10 million (approximately $16,500) for other minerals; and
  • a 20% capital gain tax (ie, 20% of the amount equal to the transfer price minus the acquisition price when the capital gain can be ascertained or 20% of the price if the capital gain cannot be ascertained).

3.10 Does an exploration licence give any priority when applying for a mining right?

This is not a priority per se, but rather an exclusive right. The holder of an exploration permit has an exclusive right to apply for an exploitation permit (during the validity period of the exploration permit) if minerals have been discovered within the mining area that has been attributed to the holder.

That said, a third party can mine quarry minerals/substances in the area covered by the exploration permit held by a given operator. For this to happen:

  • the quarry activities should not impede the exploration activities; and
  • the holder of the exploration permit must give its prior written approval to the third party wishing to carry out quarry activities.

The Ministry of Mines can also force the holder of the exploration permit to allow the third party to carry out quarry activities in the area covered by the exploration permit in the public interest – although the notion of ‘public interest' is not defined in the Mining Code.

A third party can also carry out artisanal mining in an area covered by an exploration permit. However, this is subject to the written approval of the holder of the exploration permit.

4 Mining rights

4.1 How is ownership of mining rights determined in your jurisdiction?

Ownership of mining rights is determined by the type of permit held. There are numerous types of operating licences in Burkina Faso, as follows:

  • large-scale and small-scale industrial operating permits;
  • semi-mechanised operating permits;
  • artisanal mining authorisations; and
  • quarry operating authorisations.

We have focused only on large-scale and small-scale industrial operating permits when answering question 4, because these are the most common types of licence in Burkina Faso. A large-scale or small-scale industrial operating permit is issued via a decree of the Council of Ministers based on a report of the minister of mines.

4.2 What are the key requirements in order to apply for a mining right?

The following key requirements must be met when applying for a large-scale or small-scale industrial operating permit:

  • The application must be submitted at least three months before the expiry of the exploration permit (by virtue of which the application for the large-scale or small-scale industrial operating permit is made);
  • When applying for large-scale or small-scale industrial operating permit, certain documentation must also be submitted (eg, a feasibility study; approval of the minister for the environment); and
  • Only a legal entity that is properly established in Burkina Faso (with its registered office in Burkina Faso) can apply for a large-scale or small-scale industrial operating permit.

4.3 What fees and other charges are incurred in obtaining a mining right?

The fees and charges that are incurred in obtaining a large-scale or small-scale industrial operating permit are as follows:

  • Fixed fee
    • For uranium: XOF 25 million (approximately $41,500).
    • For other minerals: XOF 10 million (approximately $16,600) for large-scale activities and XOF 5 million (approximately $8,300) for small-scale activities.
  • Application fee:
    • An application fee of XOF 10,000 (approximately $17) must also be paid.

4.4 What is the duration of a mining right? What is the process for renewal?

Large-scale industrial operating permit: A large-scale industrial operating permit is valid for 20 years, starting from the date of signature of the decree of the Council of Ministers – that is, the decree through which the large-scale industrial operating permit is issued.

A large-scale industrial operating permit can also be valid for a period similar to the life of the mine, if this is less than 20 years.

A large-scale industrial operating permit can be renewed for consecutive periods of five years until the depletion of the mining deposit.

The renewal process for large-scale operating permits and small-scale industrial operating permits is summarised below. The entire process should take approximately 90 days in total, once all necessary documentation and information has been provided.

The first step is to submit the application to the Mining Registry at least 90 days before the expiry of the large-scale or small-scale operating permit that is being renewed. The dossier should contain the following documents and information:

  • a written request (properly stamped) addressed to the minister of mines;
  • a copy of the large-scale or small-scale operating permit being renewed;
  • the exact geographical location of the mining deposits for which renewal is requested;
  • a report evidencing the continuity of activities;
  • a detailed report on work that has been done;
  • an update on the development and operating plan;
  • the opinion of the minister for the environment confirming compliance with environmental rules; and
  • a report on any exploration work done and the state of the mineral reserves.

The relevant individuals at the Mining Registry may request additional documents and information from the applicant, where necessary.

The applicant's request for renewal of the large-scale or small-scale operating permit is then analysed. If the renewal is rejected, the large-scale or small-scale operating permit will be withdrawn (by decree of the Council of Ministers). If the renewal is accepted, the applicant will be notified in writing accordingly.

Small-scale industrial operating permit: A small-scale industrial operating permit is valid for 10 years, starting from the date of signature of the decree of the Council of Ministers by which the small-scale industrial operating permit is issued.

This small-scale industrial operating permit can also be valid for a period similar to the life of the mine, if this is less than 10 years.

A small-scale industrial operating permit can be renewed for consecutive periods of five years until depletion of the mining deposit.

4.5 Who can own mining rights in your jurisdiction? Do specific requirements or restrictions apply to foreign operators?

Only a legal entity that has been properly established in Burkina Faso (with its registered office in Burkina Faso) can hold a large-scale or small-scale industrial operating permit.

Foreign operations that intend to incorporate a local entity to hold the large-scale or small-scale industrial mining permit should bear in mind that the Burkinabe state is entitled to a shareholding of at least 10% in this local entity, which will operate the mine. No other restrictions apply to foreign operators with respect to large-scale or small-scale industrial operating permits.

4.6 Do any indigenous ownership requirements apply in your jurisdiction?

No.

4.7 What role does the state play in the mining industry in your jurisdiction?

The state plays an active role in the mining industry in Burkina Faso. This ranges from promoting the mining sector and ensuring that the mining regulatory framework is complied with to direct involvement in operating companies (ie, through the 10% shareholding in local operating companies discussed in question 4.5).

4.8 Are there requirements for the government to enter into a mining development (or similar) agreement in addition to the licences/permits? When is this required or available?

The holder of a large-scale or small-scale industrial operating permit must also enter into a mining agreement with the Burkinabe state.

The mining agreement is valid for the same period as the large-scale or small-scale operating permit, but cannot technically exceed 20 years. That said, the mining agreement may be renewed for periods of five years each.

The mining agreement must be entered into within six months of the issuance of the large-scale or small-scale industrial operating permit.

A template of the mining agreement is set out in Decree 2017-035.

4.9 Can mining rights be transferred? If so, how and subject to what consents? Do any restrictions or taxes apply to direct or indirect transfers?

A large-scale or small-scale industrial operating permit may be transferred, but only to a legal entity that is properly incorporated in Burkina Faso. In addition, the transfer is subject to the prior approval of the minister of mines. The transfer process is summarised below.

The first step is to submit a request for a transfer authorisation to the Mining Registry, addressed to the minister of mines. The following documents and information must be provided:

  • a written request (properly stamped);
  • a copy of the large-scale or small-scale operating permit that is being transferred;
  • a copy of the transfer agreement properly executed by the parties, setting out the transfer price and registered with the tax office;
  • an undertaking of the transferee to carry out the development and operating work pertaining to the mining deposit;
  • an undertaking of the transferee to give (free of charge) 10% of the share capital of the operating company to the Burkinabe state;
  • an undertaking of the transferee to comply with the provisions of the mining agreement;
  • a note on the technical and financial capacities of the transferee;
  • audited accounts of all expenditures relating to the large-scale or small-scale operating permit; and
  • information on the transferee (if this is not known to the Mining Registry).

The relevant individuals at the mining registry may request additional documents and information from the transferor and/or transferee, where necessary.

The Ministry of Mines will then analyse the transfer request, which will be either rejected or authorised. The authorisation takes the form of a decree of the Council of Ministers, notified to the transferee. A copy of this decree is also sent to the transferor.

The following taxes are applicable to the transfer of a large-scale or small-scale industrial operating permit:

  • For uranium: A fixed fee of XOF 75 million (approximately $124,800).
  • For other minerals: XOF 20 million (approximately $33,200) for large-scale activities and XOF 10 million (approximately $16,600) for small-scale activities.
  • Application fee: XOF 10,000 (approximately $17) – this applies to large-scale and small-scale industrial operating permits.
  • Capital gains tax at a rate of 20% (ie, 20% of the amount equal to the transfer price minus the acquisition price when the capital gain can be ascertained or 20% of the price where the capital gain cannot be ascertained). This tax is not payable if the large-scale or small-scale industrial operating permit is transferred for free to a Burkinabe company.

4.10 Can security be taken over mining rights?

The large-scale or small-scale industrial operating permit can be pledged.

4.11 What provisions apply with regard to closure or abandonment of a mining right?

Closure of a mining right: The mining legislation is rather vague on this point.

Abandonment of a large-scale or small-scale operating permit: The procedure for the total abandonment of a large-scale or small-scale industrial operating permit is outlined below.

The holder of the large-scale or small-scale operating permit should address a request to the minister of mines. The following documents and information should also be provided:

  • a copy of the large-scale or small-scale operating permit to be abandoned;
  • a detailed memo on the exploitation work already done; and
  • an environmental rehabilitation plan.

The relevant individuals at the Ministry of Mines may request additional documents and information, where necessary.

The request is then analysed and accepted in the form of a decree of the Council of Ministers.

Buildings, outbuildings, wells and so on are transferred to the Burkinabe state. If the former holder of the large-scale or small-scale operating permit wishes to sell its machines, equipment and similar, the Burkinabe state can exercise its pre-emptive rights.

5 Surface rights

5.1 Does the law of your jurisdiction distinguish between mining rights and surface rights? If so, how does an owner of mining rights acquire surface rights?

Natural deposits of mineral substances contained in the soil and the subsoil of Burkina Faso are the property of the Burkinabe state. The Burkinabe state can mine these deposits through private partners (eg, operating companies).

In addition, having surface rights does not automatically mean having mining rights – the latter are always subject to obtaining the relevant permit (eg, a large-scale or small-scale industrial operating permit).

It is thus clear that there is indeed a distinction between mining rights and surface rights.

If the land on which the mining deposits exist belongs to the Burkinabe state, there should be no problem – that is, the state will generally give its authorisation without any particular difficulties arising. In addition, the operator should apply for the relevant permit (eg, a large-scale or small-scale industrial operating permit).

If the land on which the mining deposits exist is privately owned, the prior authorisation of the landowner is required before mining activities can be carried out on the land. The relevant permit must also be obtained (eg, a large-scale or small-scale industrial operating permit).

5.2 Where surface rights are acquired, what are the operator's rights and obligations as regards the landowner? And what are the landowner's rights and obligations as regards the operator?

The letter of the law says little on this point. The only thing that the law makes perfectly clear is the requirement to indemnify the landowner for the occupation of the land. However, the letter of the law is silent on other important factors (eg, there is no information on who exactly should pay the compensation or how this is is calculated).

5.3 Please give an overview of the process for any mandatory acquisition of surface rights (eg, process and time to enforce).

The process for a mandatory acquisition of surface rights is outlined below in chronological order:

  • The minister of mines issues his technical opinion.
  • The minister for the environment issues his opinion on the environmental and social feasibility of the project.
  • The Burkinabe state or the relevant local authority issues a declaration of intention that confirms its intent to carry out a project of public utility.
  • An inquiry is carried out in order to ascertain the public utility nature of the project This is conducted by a special commission established by the Burkinabe state or the relevant local authority.
  • A declaration of public utility is issued, by decree of the Council of Ministers or by order of the relevant local authority's council.
  • A land parcel survey is carried out by the Burkinabe state or the relevant local authority in order to determine the ownership rights that exist over the land.
  • A transferability order is issued (ie, either a joint order of the minister of land and the minister of mines or an order of the president of the local authority's council). This order basically identifies the real estate that will be subject to expropriation.
  • Compensation is paid by the Burkinabe state or the relevant local authority to the individuals or legal entities that are being expropriated.

This process generally takes at least three years.

5.4 Are any native title issues applicable, either at the exploration licence stage or when a mining right is issued?

The letter of the law is not entirely clear on this point. However, we understand that local communities must always be consulted if their land may be affected by a given project. Under these circumstances, their consent is generally required before any project can go ahead (eg, because their land is sacred to them). This consent is required regardless of the type of activity to be carried out (eg, prospecting activities or exploration activities).

5.5 Are any other rights needed to use the land (eg, zoning permissions or planning requirements)?

None that we are aware of.

6 Environmental issues

6.1 What environmental authorisations are required to undertake prospecting, exploration and mining activities in your jurisdiction? Do these vary depending on the type of mineral or the location of the activity?

The responses to question 6 focus specifically on large-scale and small-scale industrial operating permits, as these are the most commonly issued permits in Burkina Faso.

Prospecting activities: The letter of the law is not entirely clear on the type of environmental authorisation required when it comes to prospecting activities. That said, we understand that in practice, some kind of prior clearance or authorisation from the minister for the environment is required.

Exploration activities: The letter of the law is not entirely clear on the type of environmental authorisation required when it comes to exploration activities. That said, we understand that in practice, some kind of prior clearance or authorisation from the minister for the environment is required.

Large-scale and small-scale industrial operating permits: A feasibility opinion issued by the minister for the environment is required before the holder of a large-scale or small-scale industrial operating permit can carry out mining activities.

To the extent that the large-scale or small-scale industrial operating permit covers radioactive mineral substances, authorisation from the National Authority of Radioprotection and Nuclear Safety is also required.

Type of mineral/location of the activity: With the exception of the specific authorisation required for radioactive mineral substances (as explained above), the types of environmental authorisations required to undertake prospecting, exploration or mining activities do not vary depending on the type of mineral.

The location of the activity likewise has no relevance when it comes to environmental authorisations.

6.2 What environmental obligations must the operator observe while the mine is operational?

Prospecting activities: The following obligations must be observed by the holder of a prospecting authorisation:

  • If the prospecting authorisation covers radioactive minerals, the operator is subject to some specific obligations (eg, to establish a system for the control of nuclear substances; to implement a specific accounting procedure pertaining to nuclear substances).
  • Depending on how the prospecting activities have been classified by the relevant Burkinabe authorities (eg, activities that fall in the first-class category must be carried out far from an inhabited area), the following obligations might need to be complied with by the operator:
    • establish a special department in charge of environmental matters; and/or
    • provide the Ministry of the Environment with annual environmental reports.

Exploration activities: The following obligations must be observed by the holder of an exploration permit:

  • If the exploration activities cover radioactive minerals, the operator is subject to some specific obligations (eg, to establish a system for the control of nuclear substances; to implement a specific accounting procedure pertaining to nuclear substances).
  • Depending on how the exploration activities have been classified by the relevant Burkinabe authorities (eg, activities that fall in the first-class category must be carried out far from an inhabited area), the following obligations might need to be complied with by the operator:
    • establish a special department in charge of environmental matters; and/or
    • provide the Ministry of the Environment with annual environmental reports

Large-scale or small-scale industrial operating permit: The following obligations must be observed by the holder of a large-scale or small-scale industrial operating permit:

  • Every two years, the operator must issue an audit on its environmental management system. The audit is then submitted to the minister of mines for his approval.
  • Depending on how the mining activities have been classified by the relevant Burkinabe authorities (eg, activities that fall in the first-class category must be carried out far from an inhabited area), the following obligations might need to be complied with by the operator:
    • establish a special department in charge of environmental matters; and/or
    • provide the Ministry of the Environment with additional annual environmental reports.
  • If radioactive minerals are being mined, the operator is subject to some specific obligations (eg, to establish a system for the control of nuclear substances; to implement a specific accounting procedure pertaining to nuclear substances).
  • The operator must open a special account (eg, at a local bank) and then transfer money to that special account. The money will be used to cover the costs pertaining to the programme for the preservation and rehabilitation of the environment.

6.3 What environmental obligations must the operator observe in relation to closure of the mine?

The environmental obligations that an operator must observe in relation to closure of a mine are as follows:

  • Carry out the necessary rehabilitation work to the mining site; and
  • Repair any damage caused by its activities to the environment.

6.4 What are the potential consequences of breach of these requirements – both for the operator itself and for directors, managers and employees?

Prospecting authorisation: The potential consequences of breach of these requirements are as follows:

  • formal notification of the operator to cease the breach;
  • imposition of fines;
  • publication of the decision pertaining to the sanctions taken against the operator (eg, publication of a decision imposing fines on the operator for non-compliance with its environmental obligations);
  • cessation of activities carried out by the operator which could have a negative impact on public safety, health, hygiene and tranquillity; and/or
  • confiscation of any goods or products that have been obtained as a result of the breach.

The above sanctions are applicable to the operator.

The following sanctions, among others, are applicable to directors, managers and employees:

  • imprisonment for up to three months and/or fines of up to XOF 2 million (approximately $3,300) for anyone who opposes or impedes an environmental investigation carried out by the relevant Burkinabe authorities; and
  • imprisonment for up to one year and/or fines of up to XOF 1 million (approximately $1,650) for anyone who opposes the environmental control of the operator's premises.

Exploration permit: The potential consequences of breach of these requirements are as follows:

  • formal notification of the operator to cease the breach;
  • the imposition of fines;
  • publication of the decision pertaining to the sanctions taken against the operator (eg, publication of a decision imposing fines on the operator for non-compliance with its environmental obligations);
  • cessation of activities carried out by the operator which could have a negative impact on public safety, health, hygiene and tranquillity; and/or
  • confiscation of any goods or products that have been obtained as a result of the breach.

The above sanctions are applicable to the operator.

The following sanctions, among others, are applicable to directors, managers and employees:

  • imprisonment for up to three months and/or fines of up to XOF 2 million (approximately $3,300) for anyone who opposes or impedes an environmental investigation carried out by the relevant Burkinabe authorities; and
  • imprisonment for up to one year and/or fines of up to XOF 1 million (approximately $1,650) for anyone who opposes the environmental control of the operator's premises.

Large-scale or small-scale industrial operating permit: The potential consequences of breach of these requirements (with respect to large-scale or small-scale industrial operating permits) are as follows:

  • formal notification of the operator to cease the breach;
  • the imposition of fines;
  • publication of the decision pertaining to the sanctions taken against the operator (eg, publication of a decision imposing fines on the operator for non-compliance with its environmental obligations);
  • cessation of activities carried out by the operator which could have a negative impact on public safety, health, hygiene and tranquillity; and/or
  • in case of non-compliance by the operator with its obligations set out in the environmental and social impact study (ie, document submitted when applying for a large-scale or small-scale industrial operating permit), the potential withdrawal of the permit; and/or
  • confiscation of any goods or products that have been obtained as a result of the breach.

The above sanctions are applicable to the operator.

The following sanctions, among others, are applicable to directors, managers and employees:

  • imprisonment for up to three months and/or fines of up to XOF 2 million (approximately $3,300) for anyone who opposes or impedes an environmental investigation carried out by the relevant Burkinabe authorities; and
  • imprisonment for up to one year and/or fines of up to XOF 1 million (approximately $1,650) for anyone who opposes the environmental control of the operator's premises.

6.5 Which bodies are responsible for enforcement of environmental obligations?

The following bodies are responsible for the enforcement of environmental obligations:

  • Agents of the Ministry of Mines: To ensure compliance by operators with their environmental obligations, these agents are authorised to access mining sites in order to carry out the relevant controls/inspections.
  • Agents of the Ministry of the Environment and of specific territorial subdivisions: These agents also ensure that operators comply with their environmental obligations.
  • Police officers: The police will investigate potential breaches of environmental obligations by operators and gather evidence pertaining to such breaches.
  • The minister of the environment: The minister can sue operators for breach of their environmental obligations.

6.6 What is the regulators' general approach in regulating the mining sector from an environmental perspective?

The regulators play an active role in the Burkinabe mining sector, from an environmental perspective. This ranges from ensuring that operators observe their environmental obligations to sanctioning breaches of such obligations.

7 Health and safety

7.1 What key health and safety requirements apply to operators in your jurisdiction?

The following health and safety requirements apply to operators in Burkina Faso:

  • to take appropriate measures to ensure the health and safety of individuals and the safety of goods; and
  • to establish some rules pertaining to hygiene, health and security.

7.2 What reporting requirements apply with regard to mining accidents in your jurisdiction?

Any accident that occurs on a mining site must be immediately notified to the Ministry of Mines and the Ministry of Labour by the holder of the prospecting authorisation, exploration permit or mining permit.

7.3 What are the potential consequences of breach of these requirements – both for the operator itself and for directors, managers and employees?

The potential consequences of breach of these requirements are as follows:

  • withdrawal of the prospecting authorisation, exploration permit or mining permit; and
  • imprisonment for up to five years and/or payment of a fine of up to XOF 25 million (approximately $41,000).

The above sanctions apply to operators that do not comply with health and safety rules. Individuals who hold a mining permit (to the extent they are allowed to hold one under the law) may also be imprisoned for such breaches.

The letter of the law is silent when it comes to sanctions that may apply to directors, managers and employees in case of breach of health and safety requirements.

7.4 What best practices in relation to health and safety should operators consider adopting in your jurisdiction?

There are no best practices per se in relation to health and safety that operators need to adopt in Burkina Faso. That said, operators generally comply with (international) industry best practices. They must also comply with all of the obligations set out in questions 7.1 and 7.2 above, and in Decree 2007-901. Decree 2007-901 sets out detailed health and safety rules that operators must comply with (eg, taking precautions against fires; ensuring that the equipment used is safe.).

7.5 Which bodies are responsible for enforcement of health and safety obligations?

The following bodies are responsible for the enforcement of health and safety obligations:

  • Agents of the Ministry of Mines: They are authorised to take all appropriate measures to contain or prevent any danger on a given mining site.
  • Police officers: They play a similar role to ministry agents.
  • Labour inspectors: They have the right to control a mining site in order to ensure that health and safety rules are complied with.

7.6 What is the regulators' general approach in regulating the mining sector from a health and safety perspective?

The regulators play an active role in regulating the mining sector, from a health and safety perspective. This ranges from simple inspections to the imposition of sanctions, where required.

8 Processing, refining and export

8.1 What requirements and restrictions apply with regard to the processing or refining (beneficiation) or minerals?

Operators must notify the Ministry of Mines on a biannual basis of all activities relating to the processing or refining of minerals.

8.2 What requirements and restrictions apply to the export of minerals?

Operators must notify the Ministry of Mines on a biannual basis of all exports of minerals.

In addition, with respect to gold and precious metals, all exports are subject to special authorisation. The letter of the law is not entirely clear on the exact type of authorisation required for gold and precious metals mined on an industrial scale. However, for artisanal mining of gold and precious minerals, exports are subject to prior authorisation in the form of an inter-ministerial order of the minister of mines, the minister of finance and the minister of trade.

9 Taxes and royalties

9.1 What taxes, royalties and similar charges are levied on mining operators in your jurisdiction? How are these calculated?

Without being exhaustive, mining operators are subject to the following taxes, royalties and similar charges:

  • Fixed fees: These are payable in specific circumstances (eg, when applying for the renewal of a large-scale or small-scale industrial operating permit). Fixed fees vary depending on:
    • the type of minerals being mined; and
    • the scale of the activity (eg. artisanal or industrial scale).
  • Fixed fees range from XOF 100,000 (approximately $165) to XOF 75 million ($124,000);
  • Proportional fees: These are made up of surface taxes and royalties.
  • Surface taxes: These are payable every year. The amount varies depending on the size of the mining area. Surface taxes range from XOF 2,000 (approximately $3) per hectare, per year to XOF 25 million (approximately $42,000) per square kilometre, per year.
  • Royalties: These are calculated based on:
    • the volume of extracted minerals (eg, XOF 1,000 (approximately $16) per cubic metre); or
    • the proceeds from the sale of minerals (eg, 4% of the proceeds for precious metals).
  • Capital gains tax of 20%: This equates to 20% of the amount equal to the transfer price minus the acquisition price when the capital gain can be ascertained or 20% of the price where the capital gain cannot be ascertained. This tax is not payable if the large-scale or small-scale industrial operating permit is transferred for free to a Burkinabe company.

9.2 Are any tax incentives available for mining operators?

Tax incentives are available for mining operators during the different phases of a given mining activity. These incentives also depend on the type of mining activity being carried out. Without being exhaustive, these incentives are set out below:

  • Exploration phase:
    • value added tax (VAT) exemption on imports of mining equipment; and
    • exemption from corporate income tax.
  • Preliminary works:
    • VAT exemption on imports of equipment required to set up mining installations; and
    • exemption from customs duties for specific items (eg, lubricants for mining equipment).
  • Exploitation phase:
    • the standard corporate income tax rate as applies to most other companies in other types of sectors/industries (ie, 27.5%);
    • exemption from registration fees pertaining to documents relating to share capital increase; and
    • a stabilisation provision for up to 20 years (ie, no changes to the tax and customs regime will be applicable to the holder of a mining permit while it remains valid). During this period, no tax or customs duty increases or new taxes or customs duties will apply to them. Holders of artisanal mining permits cannot benefit from this stabilisation provision.

9.3 What other strategies might mining operators consider to mitigate their tax liabilities?

To mitigate their tax liabilities, mining operators might want to consider the double taxation agreements to which Burkina Faso is a party and try to take advantage of these (to the extent possible). Burkina Faso has entered into double taxation agreements with France, Tunisia and the West African Economic and Monetary Union – a regional bloc which also includes Benin, Ivory Coast, Guinea Bissau, Mali, Niger and Senegal.

9.4 Have there been any significant changes to the taxation rates applicable to mining companies in the last three years?

No.

10 Disputes

10.1 In which forums are mining disputes typically heard in your jurisdiction?

Mining disputes are generally subject to international arbitration.

10.2 What issues do such disputes typically involve? How are they typically resolved?

Most arbitral awards are not publicly available, so it is difficult to specify the types of issues that mining disputes brought before arbitral tribunals generally involve. That said, please see question 10.3 for one example.

10.3 Have there been any recent cases of note?

One prominent dispute pitted the Burkinabe government against the Pan African Burkina Minerals group. The dispute, which principally involved the group's non-compliance with its tax obligations, was brought before an international arbitral tribunal. We understand that the Burkinabe government prevailed.

11 Trends and predictions

11.1 What changes have there been to the mining landscape in your jurisdiction in the last five years?

Without being exhaustive, the mining landscape has been marked by the following recent innovations:

  • increased state revenues;
  • greater attention paid to environmental issues and community interests; and
  • a more modern Mining Registry (ie, electronically available).

11.2 How would you describe the current mining landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

There are none that we are aware of.

12 Tips and traps

12.1 What are your top tips for mining operators in your jurisdiction and what potential sticking points would you highlight?

Ensure compliance at all times with all regulations that are applicable to the mining sector, in order to avoid litigation with the Burkinabe state. Litigation is always costly and time consuming.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.