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Mining Law

Original Language Title: LEY DE MINERÍA

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LEGISLATIVE ASSEMBLY-REPUBLIC OF EL SALVADOR ____________________________________________________________________

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DECREE NO 544.-

THE LEGISLATIVE ASSEMBLY OF THE REPUBLIC OF EL SALVADOR,

CONSIDERING:

I.-That according to Art. 103, paragraph 3 of the Constitution, the subsoil belongs to the State, which may grant concessions for their exploitation;

II.-That the Mining Code was issued by Decree Legislative without number, dated May 17, 1922, published in Official Journal No. 183, Volume 93, of August 17 of the same year, resulting to the date obsolete its provisions, which makes it necessary to issue norms that in addition to being The present time, promote the exploration and exploitation of mining resources through the application of modern systems that allow the integral exploitation of minerals;

III.-That it is of prime importance that our country count on a regulatory body that harmonises with the principles of a social market economy, convenient for the investors of the mining sector; in order to promote the creation of new job opportunities for the Salvadorans; promoting the Economic and Social Development of the regions where the minerals are located, thus allowing the State the perception of such necessary revenues for the fulfillment of its objectives;

FOR TANTO,

in use of its constitutional powers and at the initiative of the President of the Republic through the Finance and Economy Ministers,

DECRETA the following: MINING LAW

CHAPTER I OBJECT OF LAW, JURISDICTION AND JURISDICTION

LAW OBJECT

Art. 1. THE MINING LAW AIMS TO REGULATE ASPECTS RELATED TO THE EXPLORATION, EXPLOITATION, PROCESSING AND MARKETING OF NON-RENEWABLE NATURAL RESOURCES IN THE SOIL AND SUBSOIL OF THE TERRITORY OF THE REPUBLIC. HYDROCARBONS IN LIQUID OR GASEOUS STATE THAT ARE REGULATED IN SPECIAL LAWS, AS WELL AS THE EXTRACTION OF PETTING MATERIAL FROM RIVERS, BEACHES AND LAGOONS THAT WILL BE REGULATED ACCORDING TO THE EXISTING ENVIRONMENTAL REGULATIONS; AND THE EXTRACTION OF SALT OBTAINED BY MARINE WATER EVAPORATION PROCESSES WHICH ARE REGULATED IN THE REGULATION FOR THE ESTABLISHMENT OF SALINERAS AND HOLDINGS FOR THE PURPOSES OF AQUACULTURE OF THE SAVOURY FORESTS. (1)

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OWNERSHIP OF THE FIELDS

Art. 2.-They are State goods, all mineral deposits that exist in the subsoil of the territory of the Republic, whatever their origin, form and physical state; as well as those of its Continental platform and its Island, in the form established in the laws or international conventions ratified by it; their dominion over the same is inalienable and imprinted.

FOR THE PURPOSES OF THIS LAW, MINERAL DEPOSITS ARE CLASSIFIED AS METALLIC AND NON-METALLIC, THE FIRST WILL BE CALLED MINES AND THE SECOND QUARRIES. (1)

NATURAL RESOURCES RENEWABLES

Art. 3. For the exploration and exploitation of mines and quarries, the State may grant Licenses or Concessions, provided that it complies with the provisions of this Law and its Regulations.

COMPETENT AUTHORITY

Art. 4.-THE EXECUTIVE BODY IN THE FIELD OF ECONOMY HEREINAFTER REFERRED TO AS "THE MINISTRY", IS THE COMPETENT AUTHORITY TO KNOW THE MINING ACTIVITY, WHO WILL APPLY THE PROVISIONS OF THIS LAW, THROUGH THE DIRECTION OF HYDROCARBONS AND MINES, WHICH IN IT WILL BE IDENTIFIED AS 'MANAGEMENT'. (1)

MINISTRY ATTRIBUTIONS

Art. 5.-For compliance with the provisions of this law, the Ministry shall have the following powers:

a) DEFINE POLICIES, PLANS, PROGRAMS AND RESEARCH PROJECTS FOR THE PROMOTION AND DEVELOPMENT OF MINING; (1)

b) Grant the concessions for the exploitation of the mining resources and subscribe with the Holders, the respective contracts;

c) Know of the Resources that this Law points out to you;

d) ISSUE THE PROVISIONS AND INSTRUCTIONS RELATED TO MINING ACTIVITIES, IN ACCORDANCE WITH THE PROVISIONS OF THIS LAW; AS WELL AS BIDDING FOR AREAS SPECIAL AREAS WHERE FIELDS WITH ECONOMIC POTENTIAL UNDER INVESTIGATION ARE LOCATED, IN INTERNATIONAL TECHNICAL COOPERATION PROGRAMMES. (1)

e) Inform the Office of the Prosecutor General of the Republic, when its Holder requires it, on the effective compliance with the requirements, conditions and purposes set out in the concessions referred to in this law; and

f) Other than this Law and its Rules of Procedure.

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ADDRESS OF THE ADDRESS

Art. 6.-The responsibilities of the Directorate are as follows:

a) Develop Development and Development Policies for mining activities in the technical, economic, industrial and commercial aspects, owing to the prior to Consideration of the Ministry;

b) To provide the necessary measures for the beneficiaries to carry out in a technical and efficient manner the exploration and exploitation of the mines and quarries, to ensure the exploitation of the mining resources, safeguard the lives and health of workers and prevent ecological and environmental deterioration;

c) TO PROCESS AND RESOLVE THE APPLICATIONS SUBMITTED FOR OBTAINING LICENSES IN ACCORDANCE WITH THIS LAW; AS WELL AS THE OTHER ADMINISTRATIVE ACTIONS RELATED TO THE MINING ACTIVITY. (1)

d) To process applications relating to the procurement of mining concessions and to raise them to the Minister's knowledge for the issuance of the corresponding Resolution or Agreement; as well as to express to that official the terms to be contain the contract to be awarded for the respective holding;

e) Carry a Register of Licenses and Concessions granted, as well as the other documents that relate to them and carry out the necessary censuses and statistics for the development of mining programmes and policies;

f) Carry out audits in the Minas and Canteras companies, in order to verify that they comply with the obligations stipulated in this Law and their Regulations, as well as with the contracts entered into;

g) Sanctioning, in accordance with this Law and its Rules of Procedure, to the violators

h) PARTICIPATE IN THE RESEARCH OF MINING PROJECTS IN INTERNATIONAL TECHNICAL COOPERATION PROGRAMS; AS WELL AS KNOW AND RULE IN THE CASES OF SPECIAL MINES; (1)

i) Vellar for the correct application of the present Law and its Regulations.

j) Approve the Minera Security Manual presented by the Holder of the Mining Grant.

JURISDICTION

Art. 7.-The holders of Mineras licenses or concessions, whether national or foreign, are subject to the laws, courts and authorities of the Republic, and cannot in any way resort to claims for diplomatic protection; They must be established in the respective contracts which, in all matters relating to the application, interpretation, execution or termination thereof, renounce their domicile and submit to the Courts of San Salvador.

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CHAPTER II MINING REGIME

PEOPLE CAPABLE OF ACQUIRING MINING RIGHTS

Art. 8. Any natural or legal person, national or foreign who is capable and suitable, may obtain mining rights, provided that it complies with the rules laid down by this Law and its Rules of Procedure; except as follows:

(a) Officials and persons referred to in Articles 127 and 128 of the Constitution;

b) Public employees who in accordance with this Law must intervene directly or indirectly in the processing of applications, their opinions or resolutions;

c) The spouses of the persons referred to in points (a) and (b) above; and

(d) Persons who are The date of granting of the Concession will not be found to be solvent with the State or the Municipality that corresponds to them, due to obligations contracted in relation to the mining activities previously carried out.

The prohibition for the civil servants and employees will extend up to one year after the date of delivery of the charge and will not understand the rights obtained in times prior to the inauguration of the office.

SUITABILITY TO ACQUIRE MINING RIGHTS

Art. 9.-They are suitable people to acquire mining rights, who check to have technical and financial capacity to develop mining projects.

Foreign legal persons must be legally authorized to carry out trade in the Republic.

REAL ESTATE MINES

Art. 10.-The deposits referred to in this Law are immovable property other than the buildings that constitute the surface area; not so the quarries that form an integral part of the land in which they are located, provided they are located to land; consequently, the concession is a real and immovable property transferred by act between the living, after authorization of the Ministry; therefore, the mentioned concession is liable to serve as guarantee in mining operations.

ACCESSORIAL ASSETS

Art. 11.-They are accessories, constructions, installations, machinery, equipment, tools and other equipment for the exploration, exploitation, processing and transport of mining products, as well as all that the separation of which could affect the economic end of the main asset.

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PHASES OF MINING ACTIVITY

Art. 12.-For the purposes of this Act, the phases of the Mining Activity are:

a) Exploration;

b) Exploitation;

c) Processing; and

d) Marketing.

MINING RIGHTS AUTHORIZATION

Art. 13. MINING AND OPERATION LICENSES OF MINERAL PROCESSING PLANTS SHALL BE ISSUED BY THE MANAGEMENT THROUGH RESOLUTIONS; CONCESSIONS FOR THE EXPLOITATION OF MINES AND QUARRIES SHALL BE GRANTED BY AGREEMENT OF THE MINISTRY, FOLLOWED BY THE SUBSCRIPTION OF A CONTRACT IN THE FORM PROVIDED FOR IN THIS LAW AND ITS REGULATION.

THE CONCESSION GRANTED FOR THE EXPLOITATION OF MINES OR QUARRIES INCLUDES THE RIGHT OF THE HOLDER TO PROCESS AND MARKET THE EXTRACTED MINERALS.

THE MANAGEMENT MAY DIRECTLY OR INDIRECTLY CONDUCT MINING EXPLORATION ACTIVITIES IN FREE AREAS AND THROUGH INTERNATIONAL TECHNICAL COOPERATION PROJECTS, FOR WHICH THE MINISTRY WILL DECLARE SPECIAL AREAS BY AGREEMENT, PRIOR TO OPINION OF THE DIRECTIVE.

THE SPECIAL AREAS OF MINING INTEREST WILL BE DECLARED FOR THE PURPOSE OF CONTRIBUTING TO THE RESEARCH AND TECHNICAL EVALUATION OF THE EXISTING DEPOSITS IN IT AND ONCE KNOWN THE ECONOMIC POTENTIAL OF THE FIELD, THE MINISTRY WILL BE ABLE TO TENDER, THE PROCEDURE OF WHICH SHALL BE LAID DOWN IN THE REGULATION OF THIS LAW.

IT WILL ALSO BE POSSIBLE FOR THE MANAGEMENT TO LICENSE THE COMMERCIAL OR INDUSTRIAL USE OF MINERAL SUBSTANCES PRESENT IN THE FIELDS OF PLEASURES, TAILINGS OR FORMER MINING BOTHERIES. SUCH LICENCES SHALL BE GRANTED BY RESOLUTION WHICH SHALL CONTAIN THE TECHNICAL OPERATING CONDITIONS; SUCH LICENCES MAY BE RENEWED PROVIDED THAT THE CONDITIONS LAID DOWN IN THE ORIGINAL LICENCE HAVE BEEN MET. (1)

FACULTY TO TRANSFER MINING RIGHTS

Art. 14.-The Holder of the Rights of Miners, can transfer them in any form by act between the living; for the cause of death of the Holder only is transferable in the case that the quality of the declared heirs is proven and they are requested by these.

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In both cases it will be necessary to authorize the Management, after checking that the acquirer gathers the same or better conditions than the Holder; the transfer will be granted for the term that will be missing for the conclusion of the License or concession original or its extension.

ZONES NOT COMPATIBLE WITH CONCESSIONS

Art. 15.-The Ministry may declare certain areas of the national territory as not compatible with mining or quarrying activities, for the following circumstances:

a) For reasons of Sovereignty;

b) areas dedicated exclusively to forestry activities or any other activity of cultural or social interest; subject to the opinion of competent institutions;

c) For ecological or environmental protection;

d) Urban perimeter of cities or towns, unless the Directorate authorizes it, after opinion favourable to the corresponding Municipal Mayor's Office or any other Institution or Entity that must be issued by law;

e) Zones occupied by public works, unless authorized by the authorities concerned; and

f) By These are areas of groundwater or surface water for the supply of drinking water.

ILLEGAL EXERCISE OF MINING ACTIVITIES

Art. 16.-The prohibition of the mining activities referred to in this law, without the corresponding authorization, shall be prohibited; those who contravene this provision shall incur the penalties provided for in this decree, without prejudice to those which are applicable by criminal law.

ENVIRONMENTAL PROTECTION

Art. 17. THE EXPLORATION AND EXPLOITATION OF MINES AND QUARRIES, AS WELL AS THE PROCESSING OF MINERALS MUST BE CARRIED OUT ACCORDING TO THE REQUIREMENTS OF THE TECHNIQUE AND ENGINEERING OF MINES, AS WELL AS THE NORMS ESTABLISHED INTERNATIONALLY, THEY SHALL MONITOR, MINIMISE AND COMPENSATE FOR NEGATIVE EFFECTS WHICH MAY BE CAUSED TO PERSONS IN AND OUTSIDE THE AREA OF EXPLORATION AND EXPLOITATION OR THE ENVIRONMENT AS A RESULT OF SUCH MINING ACTIVITIES, IN THIS RESPECT SHALL BE REQUIRED. TAKE IMMEDIATE AND NECESSARY MEASURES TO PREVENT OR REDUCE SUCH EFFECTS AND TO COMPENSATE THEM REHABILITATION OR RESTORATION ACTIONS. (1)

REPORTING OBLIGATIONS

Art. 18.-Licenses and Concessions holders shall submit to the Management, when required and at least every six months, a report on the progress achieved and the problems

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detected in their operations; as well as in terms of environmental protection and the measures envisaged to counteract the latter.

For compliance with the provisions of this article and in which it is granted, the Directorate may:

a) Request Licensing and Concession Headlines, in cases (b) Request opinions, reports and opinions to the institutions of higher education, the institutions of higher education, the institutions of higher education, and

institutions of higher education

Research, Primary Units or any other entity that is related to mining and the environment.

CHAPTER III LICENSES AND CONCESSIONS

EXPLORATION LICENSE

Art. 19.-The Exploration License confers on the Holder the exclusive power to perform mining activities, to locate the deposits of the mineral substances for which it has been granted, within the limits of the area conferred and indefinitely in depth. It also confers the exclusive right to request the respective concession.

If during the exploration process mineral substances other than those provided for in the Exploration License are found, the company must inform the Address on the particular within 30 days after its discovery. In the event that the company wishes to explore these substances, for the purpose of possible exploitation, it must request an extension of the licence to be included.

In the event that the company has no interest in these substances, must be made in writing to the Directorate and another interested company must exist, that must permit the exploration or exploitation of the same, prior to the respective license or concession.

The Holder, in addition to the works and operations of the exploration, you can build or remove buildings, camps and facilities The License shall be granted for an initial period of up to three years, which may be deemed to be appropriate, provided that it is subject to the requirements of this Law, its Rules of Procedure and other provisions applicable to it.

be extended to the management's prudential judgment, for periods of one to two years as a limit.

LICENCES SHALL BE GRANTED FOR AN INITIAL PERIOD OF FOUR YEARS, WHICH MAY BE EXTENDED FOR PERIODS OF TWO YEARS UP TO EIGHT YEARS, PROVIDED THAT THE INTERESTED JUSTIFY THE EXTENSION REQUESTED. FOR THIS PURPOSE, AN ANNUAL SURFACE CHARGE PER SQUARE KILOMETRE OR FRACTION SHALL BE CANCELLED IN ADVANCE:

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YEAR U.S. $BY KM2 OR FRACTION

1 25.00 2 50.00 3 75.00 4-6 100.00 7-8 300.00 (1)

THE PAYMENT MUST BE MADE IN LEGAL TENDER. (1)

SCAN AREA

Art. 20.-THE EXPLORATION LICENSE GRANTS TO ITS HOLDER THE RIGHT TO THE EXPLORATION OF THE PREVIOUSLY DETERMINED MINERALS, WHICH CAN BE FOUND WITHIN A SOLID OF INDEFINITE DEPTH, LIMITED BY VERTICAL PLANES CORRESPONDING TO THE SIDES OF A POLYGON, WHOSE VERTICES ARE REFERRED TO THE COORDINATES OF THE CONFORMAL PROJECTION OF LAMBERT OR UTM, ORIENTED NORTH-SOUTH, EAST-WEST, INTERNATIONAL BOUNDARIES OR THE COAST.

THE EXPLORATION AREA MUST NOT BE GREATER THAN FIFTY SQUARE KILOMETERS (50 KM2), IN THE CASE THAT REQUIRES GREATER AREA MUST BE REQUESTED AS A NEW LICENSE. (1)

OF THE PERMISSIONS

Art. 21.-If the area of exploration includes land of foreign ownership and the work is carried out on the floor area, a permit from the owner shall be required, the acquisition of which is the responsibility of the holder of the License.

cause damages to the property, the holder of the License is in the obligation to resarcirlos by common agreement with the owner of the land or according to the judgment of the competent Judge.

OBLIGATIONS OF THE HOLDER OF THE LICENSE EXPLORATION

Art. 22.-The Holder of the Exploration License shall observe, among others, the following obligations:

a) Meet the Technical Program of Exploration presented to the Directorate, and approved by it;

b) Check with the Management, at the end of each period of the License, the works and investments made, according to the Technical Exploration Program;

c) SUBMIT THE ANNUAL REPORT OF THE EXPLORATION ACTIVITIES CARRIED OUT, DULY SIGNED BY PROFESSIONALS IN THE MATTER, CONTAINING AT LEAST THE FOLLOWING ASPECTS:

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1) NAME AND ASSOCIATION OF THE MINERALS EXPLORED;

2) LOCATION AND DESCRIPTION OF THE OR FIELDS;

3) DESCRIPTION OF MINING OPERATIONS OR ACTIVITIES CARRIED OUT, BOTH FIELD AND CABINET, INCLUDING PLANS, MAPS AND GEOLOGICAL PROFILES;

4) RESULT OF PHYSICAL TESTING, METALLURGICAL AND CHEMICAL ANALYSIS PERFORMED;

5) AMOUNT OF INVESTMENT MADE; AND

6) THE LAST REPORT MUST CONTAIN THE RESERVE ESTIMATE AND THE EXPLORATION MODEL OF THE OR THE FIELDS, (1)

d) Meet the Other obligations arising out of this Law and its Regulations.

e) PAYING THE SUPERFICIAL FEE DURING THE FIRST MONTH OF EACH YEAR OF THE EXPLORATION LICENSE. (1)

CONCESSION FOR MINE EXPLOITATION

Art. 23.-The exploration and verification of the existence of the economic mining potential in the approved area will be requested, the granting of the Concession for the exploitation and exploitation of the minerals will be requested; which will be verified by Agreement of the Ministry followed by the granting of a contract signed between him and the Holder for a period of thirty years, which may be extended at the request of the person concerned, provided that the Ministry complies with the requirements laid down by the Law.

IF WITHIN ONE YEAR FROM THE DATE OF THE CONTRACT ' S TERM, THE HOLDER DOES NOT START THE PREPARATORY WORK FOR THE OPERATION OF THE DEPOSIT SHALL BE CARRIED OUT IN ACCORDANCE WITH THE SUMMARY PROCEDURE; EXCEPT FOR REASONS OF FORTUITOUS CASE OR FORCE MAJEURE, IN WHICH CASE AN ADDITIONAL PERIOD SHALL BE GRANTED WHICH SHALL NOT EXCEED ONE YEAR. (1)

When dealing with existing mines, after verification of the economic potential of the minerals, the concession may be directly requested for exploitation without the need of the Exploration License, complying with the requirements

DETERMINATION OF AREA TO BE EXPLOITED

Art. 24. THE MINING CONCESSION GRANTS TO ITS HOLDER THE RIGHT TO THE EXPLOITATION OF THE PREVIOUSLY DETERMINED MINERALS FOUND WITHIN A SOLID OF INDEFINITE DEPTH LIMITED BY VERTICAL PLANES CORRESPONDING TO THE SIDES OF A POLYGON, WHOSE VERTICES ARE REFERRED TO THE COORDINATES OF THE CONFORMAL PROJECTION OF LAMBERT, OR UTM, NORTH-SOUTH FACING, EAST-WEST, INTERNATIONAL BOUNDARIES OR THE COAST, AND MUST ALSO BE UNDERSTOOD WITHIN THE AREA

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INDICATED IN THE EXPLORATION LICENSE, AND ITS SURFACE AREA SHALL BE GRANTED ACCORDING TO THE MAGNITUDE OF THE FIELD OR THE FIELDS AND THE TECHNICAL JUSTIFICATIONS OF THE HOLDER.

THE MINING CONCESSION HOLDER WILL PAY ANNUALLY IN ADVANCE IN THE FIRST MONTH OF EACH YEAR, A SURFACE CANYON OF U.S. $300. BY KM2 OR FRACTION BY THE TERM OF THE VALIDITY OF THE CONCESSION, SUCH FEE SHALL BE MADE IN CURRENCY OF LEGAL TENDER. (1)

MINING DEALER OBLIGATIONS

Art. 25.-The Holder of a Concession has, among other things, the following obligations:

a) To explain rationally and sustainably the mineral deposits object of the concession; the technical management of the holding, must be in charge of professional mining experts;

b) Comply with the Technical Operating Program that is approved by the Management;

c) Invest in the Technical Operating Program the minimum annual sums fixed in the Contract;

d) SUBMIT TO THE MANAGEMENT FOR APPROVAL THE MINING SAFETY MANUAL, WITHIN THE FIRST YEAR OF COMMENCEMENT OF OPERATIONS, THE CONTENT OF WHICH SHALL BE LAID DOWN IN THE REGULATION OF THIS LAW; (1)

(e) Allow Inspection and Auditing by the delegates of the Ministry and the Directorate;

f) Paying the Royalties to refers to this Law, as well as the Tax, Tax, and Tax and Municipal Contributions that other laws correspond to;

g) TIMELY RENEWAL OF THE BOND OR GUARANTEE OF FAITHFUL COMPLIANCE IN FAVOR OF THE STATE; (1)

h) RENDIR EACH YEAR THE REPORT, SIGNED BY PROFESSIONALS IN THE FIELD, CONTAINING THE FOLLOWING: ASPECTS:

1) MINING TECHNICAL OPERATIONS OF THE COMPANY;

2) VOLUMES OF MATERIAL BOOT;

3) VOLUMES OF PROCESSED MATERIAL;

4) AVERAGE LAW OF THE ORE OF ENTRY TO THE PROCESS;

5) LAW OF THE COMPANY GET PRODUCT;

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6) PRODUCTION;

7) MARKETING; AND

8) AMOUNTS OF ROYALTIES PAID DURING THE PERIOD, ANNEXING PHOTOCOPIES OF THE PAYMENT VOUCHERS. (1)

I) PROVIDE MAINTENANCE TO THE MOJONES BUILT IN THE AREA UNDER THE CONCESSION. (1)

j) To add and train national technical personnel and to establish mining security programs; and

k) To comply with the other obligations arising out of this Law and its Regulations, the Concession Agreement and the Contract

SUSPENSION OF MINING OPERATIONS

ART. 26.-The Management may order or authorize the suspension of mining operations, in the following cases:

a) When as a result of the mining operations the life or property of the persons is imminent;

b) WHERE THE HOLDER DOES NOT COMPLY WITH THE PROVISIONS LAID DOWN IN THE MINING SAFETY MANUAL. (1)

c) When the Holders perform the operations in a non-technical manner, thereby propitiating the waste or generating ruinous practices with the resources; and

d) For reasons of fortuitous case or force majeure duly checked.

The Resolutions that order or authorize the suspension will be immediately executed.

TERMINATION OF LICENSES AND CONCESSIONS

Art. 27.-Licenses and Concessions terminate for the following reasons:

a) By express waiver of the Holder;

b) By death of the Holder; when the provisions of Art. 14 are not complied with;

c) For bankruptcy or dissolution where legal persons are concerned;

(d) the expiration of the period granted, or their extension; and

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e) Cancellation.

CAUSES OF CANCELLATION

Art. 28.-Licences and concessions granted in accordance with this Law shall be cancelled by the Ministry or the Directorate where appropriate, for any of the following reasons:

a) Haber incurred the Holder, for the third time in violations of the This Law, which has been sanctioned with Multa;

b) If within six months in the case of Licenses and one year in the Concessions, the operations for which they have been granted will not be initiated;

c) If in the term of one year the royalties to which the Holders are required will be paid;

d) For not allowing the Directorate or the Ministry, in a manifest or repeated manner, the functions of surveillance, oversight, audit or any other performance related to mining activities or for refusing to render the reports to which it is required in accordance with the Law;

e) For the concealment or subtraction of mining substances, for fraudulent purposes;

f) FOR REVOCATION OF THE ENVIRONMENTAL PERMIT BY THE COMPETENT AUTHORITY. (1)

g) For other reasons and in the specific cases that this Law points out.

To proceed with the cancellation of the license or a concession, the Address will instruct the information, applying the procedure outlined in Arts 70 and 71 of this law.

EFFECTS OF THE TERMINATION OF OPERATING CONCESSIONS

Art. 29.-Termination of the concession for the mining exploitation by any of the causes mentioned in Art. 27, the right is extinguished and returns to the domain of the State the property that comprises the field or mine in question; as well as all the installations whose removal could cause damage to the field that is the object of the operation or threaten its security, without any compensation.

CHAPTER IV EXPLOITATION OF QUARRIES

CONCESSION OF QUARRY EXPLOITATION

Art. 30.-THE CONCESSION OF THE EXPLOITATION OF QUARRIES GIVES THE HOLDER, WITHIN THE LIMITS OF HIS AREA AND INDEFINITELY IN DEPTH, THE EXCLUSIVE FACULTY TO EXTRACT, PROCESS, TRANSPORT AND DISPOSE OF THE MINERAL SUBSTANCES FOR WHICH HE HAS BEEN GRANTED. THE DEPTH MAY BE LIMITED ACCORDING TO THE GEOLOGICAL AND HYDROGEOLOGICAL CONDITIONS REFERRED TO IN THE FEASIBILITY OF EXPLOITATION OF THE FIELD.

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THE CONCESSION AREA SHALL BE GRANTED ON THE BASIS OF THE MAGNITUDE OF THE DEPOSITS AND THE TECHNICAL JUSTIFICATIONS OF THE HOLDER, AND SHALL BE DELIMITED BY CONFORMAL DESIGN COORDINATES OF LAMBERT OR UTM, ORIENTED NORTH-SOUTH, EAST-WEST, INTERNATIONAL OR COASTAL BOUNDARIES.

THE AREA MAY BE EXPANDED IN ADJACENT LAND TO A FIFTH OF THE AREA ORIGINALLY GRANTED IN CASES WHERE THE FIELD CONTINUES AND ITS EXPLOITATION IS FEASIBLE.

THE HOLDER MAY EXECUTE ALL NECESSARY OPERATIONS AND NECESSARY WORKS THAT ENABLE THE DEVELOPMENT OF THE OPERATING ACTIVITIES, PROVIDED THAT THEY ARE SUBJECT TO THE REQUIREMENTS OF THIS LAW AND ITS REGULATION, ITS AGREEMENT AND CONTRACT OF CONCESSION.

THE PROPERTY IN WHICH THE QUARRY IS LOCATED SHALL BE THE PROPERTY OF THE PERSON WHO IS APPLYING FOR IT OR HAVING THE AUTHORIZATION OF ITS OWNER OR HOLDER GRANTED IN LEGAL FORM. (1)

VALIDITY OF THE QUARRY EXPLOITATION CONCESSION

Art. 31.-The concession for the exploitation of quarries shall be granted for a period not exceeding twenty years, which may be extended, at the request of the person concerned, provided that in the opinion of the Directorate and the Ministry it complies with the requirements of the Law sets.

QUARRY EXPLOITATION HOLDER OBLIGATIONS

Art. 32.-They are obligations of the holder of the concession for the exploitation of quarries, the following:

a) To explain rationally and sustainably the non-metallic mineral deposits of industrial use; the Technical Direction of the exploitation, must be in charge of professionals in the field of quarrying;

b) SUBMIT TO THE MANAGEMENT FOR APPROVAL, THE MINING SAFETY MANUAL, WITHIN THE FIRST YEAR OF THE START OF OPERATIONS; (1)

c) Pay Taxes, Fees, or Tax or Municipal contributions that are otherwise applicable to you;

d) RENEW TIMELY BAIL OR GUARANTEE OF FAITHFUL COMPLIANCE IN FAVOR OF THE STATE;

e) SUBMIT THE REPORTS ANNUALLY TO THE MANAGEMENT, DULY SIGNED BY PROFESSIONALS IN THE FIELD AND CONTAINING AMONG OTHERS THE FOLLOWING ASPECTS:

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1) NAME AND ASSOCIATION OF THE MINERALS OR ROCKS IN OPERATION;

2) LOCATION AND DESCRIPTION OF THE OR DEPOSITS;

3) METHOD OF EXPLOITATION AND ADVANCEMENT OF THE HOLDING;

4) STOCKS OF MATERIAL OR MINERAL USEFUL LIFE OF THE QUARRY IN OPERATION; AND

5) PRODUCTION AND SALE FOR ALL TYPES OF PRODUCTS. (1)

f) Initiate operations within six months of the term of the contract; and

g) Meet the other obligations arising out of this Law, its Regulations and the respective Contract.

CHAPTER V PROCESSING AND MERCHANDISING

PROCESSING PLANT

Art. 33.-The concession, grants to the holders the right to install their plants for the processing of the mining substances within which they include operations of separation, concentration, profit and/or transformation, in order to raise the law or percentage of the same to obtain mining products.

IF THE DEALER WANTS TO PROVIDE PROCESSING SERVICE TO THIRD PARTIES, HE WILL NEED TO OBTAIN A PROCESSING LICENSE BEFORE THE ADDRESS; HE WILL ALSO HAVE TO OBTAIN THE PARTICULAR ONES THAT WANT TO ENGAGE IN EXTRACTION ACTIVITY; THE LATTER MUST COMPLY WITH THE PERMIT ENVIRONMENT ISSUED BY THE COMPETENT AUTHORITY.

IN THE PRODUCTION PROCESSES, THE TREATMENT OF SOLID WASTE, LIQUIDS, GASEOUS EMISSIONS AND POWDERS THAT ARE GENERATED, WILL BE SUBJECT TO THE PROVISIONS OF THE ENVIRONMENTAL PERMIT. (1)

VALIDITY OF THE PROCESSING LICENSE

Art. 34.-The validity of the processing licence granted to the concession holders shall be for the same period of the concession for the exploitation of the mines; that of the private persons shall be granted for an indefinite period, provided that they are complied with. to the applicable legal provisions.

MERCHANDISING

Art. 35.-The Holder of the Concession shall own the extracted minerals, and as such, may freely market them, either inside or outside the country, provided that it complies with the regulations dictated by the Ministry; and shall be subject to the payment of all types of taxes.

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When dealing with the marketing of minerals whose use is proprietary to the State or its institutions, whether for reasons of safety or environmental protection, the Ministry will dictate provisions on how they can be acquired, held in warehouses, transported, imported or exported.

CHAPTER VI PROCEDURE FOR THE FILING OF ATTACHMENTS

REQUEST

Art. 36.-The person interested in obtaining the Licenses and Concessions referred to in this law must submit to the Address, written request with the following minimum requirements:

a) Designation of the authority to whom it is addressed;

b) THE NAME AND THE GENERAL NAME OF THE APPLICANT, AND WHETHER IT IS MANAGED BY ANOTHER PERSON, THE GENERALS OF THIS PERSON AND THE QUALITY WITH WHICH HE ACTS, THE TAX IDENTIFICATION NUMBER (NIT), THE TAXPAYER IDENTIFICATION NUMBER, THE CERTIFIED PHOTOCOPY OF THE FOREIGN CAPITAL. (1)

c) The succinct display of the request, concretizing the request;

d) Designation of the place to hear notifications;

e) Relationship of the accompanying documentation; and

f) Place and date of the request.

ATTACHMENTS DOCUMENTS

Art. 37.-IF THE PETITIONER DOES NOT ACT IN ITSELF, TO THE APPLICATION REFERRED TO IN THE PREVIOUS ARTICLE, HE MUST ATTACH THE DOCUMENT THAT ACCREDITS HIS LEGAL PERSON, WHETHER HE DOES SO ON BEHALF OF A NATURAL OR LEGAL PERSON; IN THE LATTER CASE HE MUST ALSO, CHECK THE LEGAL EXISTENCE OF THIS. IN ADDITION, YOU WILL PRESENT THE FOLLOWING DOCUMENTATION: (1)

1. FOR SCAN LICENSE

a) LOCATION PLANE OF THE BUILDING IN WHICH THE ACTIVITIES, TECHNICAL DESCRIPTION AND EXTENSION OF THE REQUESTED AREA WILL BE PERFORMED;

(b) CARTOGRAPHIC SHEET OF THE AREA OF THE LAND, WHERE ITS LOCATION AND BORDERS ARE ESTABLISHED;

c) TECHNICAL PROGRAM OF EXPLORATION, WHICH MUST CONTAIN THE MINING ACTIVITIES TO BE CARRIED OUT AND THE MINIMUM AMOUNT OF CAPITAL INVEST IN EACH ACTIVITY;

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(d) DOCUMENTS PROVING THE TECHNICAL, FINANCIAL AND MINING EXPERIENCE OF THE APPLICANT;

(e) AS WELL AS OTHERS THAT THE ADDRESS DEEMS APPROPRIATE. (1)

2. FOR THE EXPLOITATION OF MINES AND QUARRIES

a) PLAN OF LOCATION OF THE BUILDING IN WHICH THE ACTIVITIES WILL BE CARRIED OUT, MAP MAP OF THE AREA, TOPOGRAPHIC PLANE AND ITS RESPECTIVE TECHNICAL DESCRIPTION, EXTENSION OF THE REQUESTED AREA WHERE ESTABLISH THEIR LOCATION, BORDERS AND NAME OF THE ADJACENT ONES;

b) DEED OF OWNERSHIP OF THE PROPERTY OR AUTHORIZATION GRANTED IN LEGAL FORM BY THE OWNER;

c) ENVIRONMENTAL PERMIT ISSUED BY AUTHORITY COMPETENT, WITH COPY OF THE ENVIRONMENTAL IMPACT STUDY;

d) TECHNICAL FEASIBILITY STUDY ECONOMIC, DEVELOPED BY PROFESSIONALS RELATED TO THE SUBJECT;

e) PROGRAM OF EXPLOITATION FOR THE FIRST FIVE YEARS, SIGNED BY A GEOLOGIST OR COMPETENT PROFESSIONAL IN THE FIELD;

F) OTHERS TO BE ESTABLISHED REGULATIVELY. (1)

3. FOR PROCESSING PLANT

(a) TECHNICAL-ECONOMIC STUDY DEMONSTRATING THE FEASIBILITY OF THE PROJECT, DEVELOPED BY PROFESSIONALS RELATED TO THE SUBJECT;

b) ENVIRONMENTAL PERMIT ISSUED BY THE COMPETENT AUTHORITY, WITH A COPY OF THE STUDY ENVIRONMENTAL IMPACT;

c) OTHERS TO BE ESTABLISHED REGULATIVELY. (1)

THE APPLICATION AND SUPPORTING DOCUMENTS MUST BE WRITTEN IN SPANISH; IF THE LATTER ARE IN ANOTHER LANGUAGE THEY MUST BE LEGALLY TRANSLATED, AND IF THEY HAVE BEEN EMANATED FROM THE FOREIGN COUNTRY THEY MUST BE PRESENTED WITH THE APOSTILLE Corresponding. (1)

THE ORDER OF FILING OF THE APPLICATION, GIVES PREFERENTIAL RIGHT FOR THE GRANT OF THE REQUESTED, PROVIDED THAT THE REQUIREMENTS OF LAW ARE MET. (1)

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ADMISSION OF THE REQUEST

Art. 38. In legal form, a request will be made, and the Directorate's delegates will be inspected, and if it is favorable, it will be accepted. In case of failure to comply with the requirements of law, the person concerned shall be given a period of not exceeding 30 days in order to remedy the omissions; if the time limit does not exceed them, the application shall be declared without the application and the file shall be ordered. of the same.

REQUEST RESOLUTION

Art. 39.-The actions indicated by the article above, the Directorate shall issue the appropriate resolution, within 15 working days.

PUBLICATIONS

Art. 40.-An application for a concession for exploitation shall be admissible, the Directorate shall publish at the expense of the person concerned, a notice containing an extract thereof, which shall be carried out in the Official Journal and in two newspapers of greater circulation national, for two times each, with eight-day intervals between each publication; it will also send a copy of it to the respective Municipal Mayor's Office, to be placed on the posters that for this purpose carry the municipalities of the country.

NOTICE PUBLICATIONS MUST BE SUBMITTED TO THE ADDRESS WITHIN 45 DAYS, CASE THE REQUEST WILL BE REJECTED AND THE FILE OF THE REQUEST WILL BE ORDERED. (1)

OPTIONS

Art. 41. Within 15 days of the date of the last publication in the Official Journal, persons who claim to have a legitimate interest or who are injured may object to the request. From this opposition it will be sent to hear for three working days to the parties, with the possibility of the Direction, if the appropriate estimate or if requested, to open to evidence for the term of eight days, and presented, will resolve on the opposition, within the the following fifteen working days, declaring it without a place if it is not founded, in which case it will be ordered to proceed with the processing of the application.

If it is not satisfied with the resolved, the person concerned may file within the term of three days, counted from the following of the notification of the Resolution to which the final part of the paragraph refers Appeal to the Minister, who must resolve the matter within eight working days of receiving the proceedings.

Art. 42. THE RESOLUTION DECLARING, WITHOUT PLACE, THE OPPOSITION, OR NOT HAVING BEEN BROUGHT, SHALL BE SIGNED, AND AFTER 15 DAYS AFTER THE LAST PUBLICATION REFERRED TO IN THE FIRST INDENT OF THE PRECEDING ARTICLE; THE ADDRESS SHALL ORDER THE WORK OF MENSURA AND AMOJONAMIENTO OF THE LIMITS OF THE AREA COVERED BY THE APPLICATION, WHICH MUST BE COMPLETED WITHIN THE PERIOD UP TO SIXTY DAYS; THESE MOJONES MUST BE SOLIDLY CONSTRUCTED. IF BY ROAD ACCIDENTS THESE CANNOT BE CONSTRUCTED, ADDITIONAL MOJONES SHALL BE FIXED IN VISIBLE PARTS OF THE FIELD, PROVIDED THAT IT IS FEASIBLE TO DO SO; THE RELEVANT OPINION SHALL BE VERIFIED AND THE RELEVANT OPINION SHALL BE SUBMITTED TO THE KNOWLEDGE OF THE MINISTER OF ECONOMY, WHO

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PROCEED IN THE FORM SET OUT IN THE FOLLOWING ARTICLE. (1)

CONCESSION AGREEMENT

Art. 43.-Received the file referred to in the previous article, the Minister may request the reports and order the practice of the proceedings which he considers appropriate and within the fifteen working days following the receipt, if appropriate, issue the corresponding Agreement, which shall be accepted within eight working days following the issuance of the Agreement, by the applicant.

If the concession is deemed inappropriate, it shall issue an unfavourable resolution; Appeal for review, which may be brought by the person concerned to the same Minister, within three working days of the respective notification, a resource to be resolved within 15 days of its submission.

This Resolution will not support any recourse.

OPERATING CONTRACT

Art. 44.-Published in the Official Journal of the Concession Agreement, the respective contract between the Minister and the Holder of the concession shall be granted; in which, in addition to the relationship of such an Agreement, the exclusive right shall be entered the concessionaire has to exploit the mineral substances which are the subject of the concession, and shall establish, in accordance with this Law, the terms, rights and obligations under which it shall be governed; the following stipulations must be expressly fixed:

(a) That the State will not assume, by any means, any responsibility for the investments or operations to be carried out, or any unsuccessful results thereof;

b) That preference will be given to the use of Salvadoran products, goods and services in the performance of mining operations;

c) The contract shall be the same as in the Concession Agreement; and

(d) THE CONTRACTS MAY BE TERMINATED BEFORE THE SPECIFIED PERIOD, DUE TO THE EXHAUSTION OF THE MINERAL SUBSTANCES BEING EXPLOITED, AND IN THE EVENT OF CANCELLATION OF THE CONTRACT. CONCESSION, FOR NON-COMPLIANCE WITH THE PROVISIONS OF THIS LAW AND ITS REGULATION; (1)

of the Contract may be modified by mutual consent of the parties, for reasons justified and provided that they are attached to the provisions of this Law and their Regulations.

APPEAL

Art. 45.-RESOLUTIONS ISSUED BY MANAGEMENT, WHICH REFUSE A LICENSE TO THOSE PROVIDED FOR IN THIS LAW OR ANY OTHER DECISION GIVEN IN ACCORDANCE WITH THIS LAW, SHALL ADMIT APPEAL TO THE MINISTER OF ECONOMY FOR APPEAL. TO BE BROUGHT WITHIN THREE WORKING DAYS FOLLOWING THAT OF THE RESPECTIVE NOTIFICATION.

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BRINGING THE ACTION IN LEGAL FORM, THE FILE SHALL BE ACCEPTED AND FORWARDED TO THE MINISTER OF ECONOMY, WHO SHALL SEND THE APPELLANT TO THE APPELLANT FOR THE TERM OF THREE WORKING DAYS AND IF HE IS REQUESTED TO OPEN IT FOR EVIDENCE FOR THE TERM OF EIGHT WORKING DAYS; VERIFIED WHICH WILL ISSUE THE APPROPRIATE RESOLUTION WITHIN THE FIFTEEN BUSINESS DAYS. (1)

DISCOVERY OF DIFFERENT MINERAL SUBSTANCES

Art. 46.-In the event that the Holder discovers different mineral substances for which the Concession has been granted, or is estimated to be of high economic or strategic value, special mines shall be considered; Address, within 30 days of the discovery for the purposes indicated in Art. 19. If the holder is interested, the Directorate shall determine whether it is necessary to extend the Concession Agreement and the respective Contract or to subscribe to another; in the latter case, its form of exploitation and exploitation must be determined, which, without To stop making their exploitation profitable, it favours the interests of the State. The Minister for approval, as well as the Office of the Attorney General for the effects of Art. 193, should be taken into account for the purposes of the Constitution.

CHAPTER VII MINING SUPERVISION AND REGISTRATION

INSPECTIONS

Art. 47.-The Directorate shall ensure that the necessary measures are taken to ensure that appropriate technical methods and systems are used to protect the lives and health of workers, ensure the rational use of mineral resources, and avoid deterioration of the environment.

In addition, it will conduct audits, in order to determine whether the dealers comply with the payment of the royalties established by this law. For such purposes, it shall carry out inspections by means of its delegates, who may take samples, review documentation, and carry out tests and measures that it deems necessary, all without prejudice to the powers that correspond to others. authorities.

ADOPTING MEASURES

Art. 48.-WHEN THE ADDRESS HAS KNOWLEDGE THAT MINING ACTIVITIES ARE BEING CARRIED OUT WHICH MAY CAUSE HARM TO THE HEALTH OR LIFE OF THE PERSONS, TO THE ENVIRONMENT OR TO THE GOODS OF THIRD PARTIES, WITHOUT FURTHER PROCESSING IT SHALL ORDER THE PRACTICE OF THE PROCEEDINGS WHICH IT CONSIDERS APPROPRIATE, AND IF THE SERIOUSNESS OF THE DAMAGE IS TO BE VERIFIED, TO ORDER BY RESOLUTION, THE IMMEDIATE SUSPENSION OF THE ACTIVITIES AND SHALL INFORM THE COMPETENT AUTHORITIES OF THE RESULTING LEGAL EFFECTS. (1)

MINING LOG

Art. 49.-Establish the Mining Registry as a system of registration, authenticity and publicity of the acts that are intended or related to the Licenses or Concessions referred to in this Law; this register shall be in charge of the Directorate, and will be carried through Books, in the form that the Directorate establishes, taking care to relate all the documents that are submitted for registration to them,

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in the order of your receipt, with indication of the date and time of filing; the correlative number and nature of the document.

To whom you will submit documents for registration, you will be provided with written record of your receipt, which will contain date, time, and order number.

THE AGREEMENTS AND CONTRACTS MINING CONCESSION, IN ADDITION TO REGISTERING IN THE REGISTRY OF THE ADDRESS, MUST BE REGISTERED, THE FIRST IN THE REGISTER OF COMMERCE AND THE SECOND IN THE REGISTRATION OF THE ROOT PROPERTY AND MORTGAGES, CORRESPONDING. (1)

DOCUMENTS TO BE REGISTERED

Art. 50.-In addition to the documents under which Licenses or Concessions are granted referred to in this Law, the following shall be entered in the register of the Address:

(a) The charges against the right to be explored or (b) Mining services;

c) The embargo on the rights of exploration, exploitation or any judicial provision affecting such rights;

d) guarantees constituted by the Licenses and Concessions holders; and

e) Transfers to which refers to this Act and those ordered by a court judgment.

OBLIGATION TO REGISTER

Art. 51.-No License or Mining concession or act that modifies, grave or cancel will have effect against third parties without their prior registration in the corresponding Records.

The Mining Registry is public and upon request of any person and payment of the corresponding rights, certification of the documents or parts or passages thereof; the one that can be done by any means of mechanical or photostatic reproduction.

CANCELLATION OF INSCRIPTIONS

Art. 52.-The cancellation of an entry in the Mining Registry shall proceed when the decision, agreement or judgment, issued by the Directorate, the Ministry or the Judge competent in his case, which cancels the rights granted, shall be ordered.

CHAPTER VIII OF EASEMENTS

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VOLUNTARY EASEMENTS

Art. 53.-The license holders or mining concessions may agree with the owners or owners of the land necessary to carry out their mining activities, the voluntary easements that they consider convenient.

LEGAL EASEMENTS

Art. 54.-In addition to the Voluntary Servants, the Holders will enjoy the Legals of Occupation, Transit or Pass, Desague, Ventilation, Transmission of Electric Power or any other that directly benefits or requires the activity

Mining easements will be governed by the provisions of this Law and, as not provided for, by the provisions of the Civil Code.

LIMITATIONS IN THE CONSTITUTION OF EASEMENTS

Art. 55.-The Holder of a License or Concession is in the obligation to restore the lands and other goods destroyed or damaged, as set forth in the corresponding easement document.

No easements may be constituted when this will cause or cause damage to public works and/or services, ecological reserve zones or those in which mining activities are not permitted in accordance with this Law.

CONSTITUTION OF EASEMENTS

Art. 56.-The Constitution of the Serviements referred to in this law is temporary; its exercise and corresponding indemnities shall be established by mutual agreement between the Holder and the owner or occupant of the land, through Public Deed, which shall be will register in the corresponding Property Registry and will be entered in the Registry of the Address.

RULES FOR FIXING COMPENSATION

Art. 57.-For the fixing of the amount of compensation incurred in the exercise of the easements referred to in this chapter, the following rules shall be observed:

a) The current commercial value of the use of the goods affected or damaged by the exercise of servitude and not the economic importance of the projects and works of mining, nor the quality and value of the minerals to be extracted, nor the economic capacity of the person liable for the compensation;

(b) If the occupation of the property is partial and shall not cause demerit to the property as a whole or to the parties of the same unaffected, the compensation shall comprise only the value of the use of the occupied part; and

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(c) If the occupation of the property is temporary, the value of its use shall be estimated for the time necessary to maintain the works and carry out the mining works. It is understood that there is transient occupation, when in the building works, equipment, movable or movable elements are installed and operated that can be removed without detriment of the terrain and whose permanence does not exceed two years; they are considered permanent when the same cannot be moved by its very nature and location without being destroyed or without causing deterioration of the terrain in which they are located;

OCCUPATION EASEMENT

Art. 58.-The easement of occupation empowers the concessionaire to occupy the areas of land that are strictly necessary for its constructions, installation of equipment and other tasks. This easement also includes the ability to open and maintain channels, tongas, sinkholes, accesses, galleries and other mining works in its various modes and extraction systems; as well as to establish fences, points and protection of the busy zones.

VENTILATION EASEMENT

Art. 59.-The ventilation easement consists of the right to communicate with the surface, the interior tasks for the sole effect of providing them with the necessary ventilation.

DRAIN AND DISCHARGE EASEMENT

Art. 60.-The servitude of drainage and discharge consists in the activity and the works necessary to remove the water that floods the mines or the one that has been used in their work. Such waters must be treated in order not to cause any contamination.

TRANSIT EASEMENT

Art. 61.-The transit easement empowers the Holder and his/her staff to move the necessary materials and equipment from the public road to the workplaces and to transport the minerals and extracted products to the same route.

easement carries the right to build, maintain and use the works, facilities and equipment that are technically and economically advisable for an efficient operation of transit, transportation, boarding of people and things by land, sea, air or river, depending on the characteristics and magnitude of the mining project.

PERMISSION TO THIRD PARTIES FOR THE USE OF EASEMENTS

Art. 62.-The transit and transport routes, as well as the works of aqueducts, energy and other works of infrastructure for human use constructed by the Holder, may be used by third parties, when they do not damage or hinder the regular operation of the mining company and the satisfaction of the mining company's needs.

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CHAPTER IX TAX REGIME

TAX AND MUNICIPAL OBLIGATIONS

Art. 63.-The Licenses and Concessions holders referred to in this Law shall comply with their formal and substantive obligations, in relation to the tax and municipal taxes, fees and contributions that according to the respective laws establish; and the dealers also, to comply with the Royalty payment.

ROYALTIES

Art. 64. It is understood by Regalia, the payment of a percentage in money that the Holder of the mining concession must make to the State and to the Municipal Municipality respective, in compensation for the exploitation and exploitation of the mining substances. Its amount will be set on the total net sales value obtained in the period; the sales prices must be in line with the international market and will be checked by the corresponding invoices.

Mineral exploitation is required to report monthly to the Management, the quantities produced of metallic and non-metallic minerals and the respective sales prices.

The payment of the Regalia must be made quarterly.

APPLICABLE PERCENTAGES

Art. 65.-The percentage referred to in the preceding article shall be established as follows:

(a) TO THE STATE, WHEN IT IS CONCERNED WITH METALLIC MINERALS, ONE PER CENT (1.%). (1)

b) To the municipalities, whether they are metallic, non-metallic or quarrying minerals, which indicate the respective municipal tax laws of the municipality to whose jurisdiction the exploitation of minerals corresponds, not Should exceed this one percent 1%.

ROYALTY SETTLEMENT AND SURFACE GUNS (1)

Art. 66.-The holders of the mining concessions shall carry out their own liquidation and shall make the payment of the Royalties effective, within thirty days after the expiration of the period in question, in any of the eligible Collectors by the Ministry of Finance, by means of the order of revenue to be issued by the Directorate.

THE SURFACE LICENCE FEE FOR EXPLORATION AND OPERATING CONCESSION SHALL BE PAID ANNUALLY IN ADVANCE DURING THE FIRST MONTH OF EACH YEAR. YEAR OF EXPLORATION OR EXPLOITATION, IN ANY OF THE COLLECTIONS AUTHORIZED BY THE MINISTRY OF HACIENDA, BY MEANS OF THE ENTRY ORDER THAT WILL ISSUE THE ADDRESS.

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(1)

AFFIDAVIT AND ROYALTY PAYMENT

Art. 67. In order to verify the payment of the Royalties, the Holder must present to the Management, within the month after the expiration of each quarter, the following documents:

a) Affidavit of the provisional liquidation of the royalties;

b) Proof of having paid the Regalia, for the preceding quarter.

The declaration of the first quarterly period shall comprise, from the date of validity of the granting of the mining concession to the last day of the corresponding quarter.

EXECUTIVE ACTION

Art. 68.-The lack of payment of the Regalia in the period established in Art. 64, paragraph 3 of this Law, entitles to its collection by the executive way by the Ministry, for which it will transmit certification of the liquidation to the Attorney General of the

Republic, to make it effective according to common procedures.

CHAPTER X VIOLATIONS AND PENALTIES (1)

VIOLATIONS

Art. 69.-INFRINGEMENTS OF THIS LAW AND ITS RULES OF PROCEDURE, ACTIONS OR OMISSIONS BY NATURAL OR LEGAL PERSONS, WHICH ARE CLASSIFIED ACCORDING TO THE NATURE AND GRAVITY OF THESE ACTS, IN LESS SERIOUS AND SERIOUS. (1)

ARE LESS SEVERE THE FOLLOWING:

a) NOT SUBMIT FOR APPROVAL WITHIN THE FIRST YEAR OF OPERATION, THE MINING SECURITY MANUAL;

b) FAILING TO COMPLY WITH THE OBLIGATIONS CONTAINED IN THE (A) OF ARTICLE 22 AND (B) OF ARTICLE 25 OF THE MINING ACT;

(c) NOT SUBMIT WITHIN THE PRESCRIBED PERIOD OR WHEN THE ADDRESS SO REQUIRES, THE REPORT REFERRED TO IN ARTICLE 18 (18) OF THE MINING ACT;

(d) NO TO REPORT WITHIN THE TIME LIMIT SET OUT IN ARTICLE 19 (2) AND ARTICLE 46 (2) OF THIS LAW, ON THE FINDING OF MINERAL SUBSTANCES OTHER THAN THOSE PROVIDED FOR IN THE EXPLORATION LICENCE GRANTED BY THIS ADDRESS;

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(e) VIOLATING THE TECHNICAL RULES OF THE MINING SAFETY MANUAL, APPROVED BY MANAGEMENT;

f) NOT TIMELY RENEW THE BAIL OF FAITHFUL COMPLIANCE TO RESPOND FOR DAMAGES CAUSED TO THE STATE OR TO THIRD PARTIES;

g) NO MAKE THE PAYMENT OF THE SUPERFICIAL FEE WITHIN THE PRESCRIBED PERIOD CORRESPONDING. (1)

ARE SERIOUS AS FOLLOWS:

(a) PERFORM THE MINING ACTIVITIES REFERRED TO IN THIS LAW, WITHOUT THE CORRESPONDING AUTHORIZATION;

b) OBSTRUCT MINING OPERATIONS TO THE HOLDERS OF EXPLORATION LICENSES AND MINERAL EXPLOITATION DEALERS, WITHOUT ANY LEGAL CAUSE FOR IT;

c) SUPPLYING FALSE DATA IN THE REPORTS THAT ARE ESTABLISHED IN THE MINING ACT AND THOSE REQUESTED BY THE MANAGEMENT. (1)

OF THE SANTIONS

Art 69-A.-THE FINES FOR VIOLATIONS OF THE PROVISIONS OF THIS LAW AND ITS REGULATION WILL BE ESTABLISHED IN MONTHLY MINIMUM WAGES, EQUATING EACH MONTHLY MINIMUM WAGE TO THIRTY MINIMUM WAGES URBAN NEWSPAPERS IN FORCE FOR THE CITY OF SAN SALVADOR.

LESS SERIOUS INFRACTIONS WILL BE SANCTIONED FROM TEN TO ONE HUNDRED MINIMUM MONTHLY WAGES. IN CASE OF RECIDIVISM IT WILL BE DOUBLED. SERIOUS INFRINGEMENTS WILL BE PUNISHABLE BY 100 TO A THOUSAND MINIMUM MONTHLY SALARIES. IN CASE OF RECIDIVISM IT WILL BE DOUBLED. (1)

SANCTIONS ENFORCEMENT PROCEDURE

Art. 70.-The penalties shall be imposed by the Directorate, after hearing the person concerned, for three working days; who may within that term request the opening to be tested for the fatal and unextendable term of eight working days.

Address shall dictate, within the following fifteen working days, that which shall be admissible to the Minister; an appeal to be brought by the person concerned within three working days, numbered from the following: the respective notification.

Introduced the cars before the Minister, this will resolve within the following 15 working days, whether or not the appellant has appeared. This Resolution will not support any recourse.

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When the sanction is cancellation of the Concession, concluded the procedure referred to in this article, will proceed to revoke the Agreement of the respective Concession and to request to the Office of the Prosecutor General of the Republic the termination of the Contract granted.

PENALTY COMPLIANCE DEADLINE

Art. 71.-The Resolution imposing a sanction shall have an Executive force; the infringer must comply with it, within three working days following the one in which it is notified; otherwise, the offender shall be certified to the Prosecutor General of the Republic to make it effective, in accordance with the common procedures. What is perceived will be entered into the General State Fund.

The penalties provided for in this Law shall be imposed, without prejudice to the criminal liability to which it may occur; in which case, the Directorate shall be obliged to inform the relevant to the Office of the Prosecutor General of the Republic, in order to exercise the corresponding actions, in accordance with the provisions of Art. 193, ordinal 10th of the Constitution.

CHAPTER XI FINAL PROVISIONS, REPEAL AND VALIDITY

Art. 72.-The provisions of this Law, due to its special character, shall prevail over any other provisions that would be contrary to it.

Art. 73.-The persons who enter into force this Law are the creditor of Licenses or Concessions for the exploration or exploitation of minerals, they will continue to enjoy the same for the deadlines granted. Notwithstanding the foregoing, they shall be required to comply with the provisions of this law within a period of one hundred and twenty days following that date.

The Ministry or the Directorate, where applicable, shall comply with the requirements of the law, replace the documents issued on the basis of the Mining Code which is repealed, by which it establishes this law; in the same obligation and within the same time limit must be done by those who have their resolutions in the process.

to date are engaged in mining activities without being legally authorized to do so, they must submit their applications as well within one hundred and twenty days from the time of this law.

Art. 74.-The President of the Republic will dictate the Regulation for the implementation of this Law.

Art. 75.-This law is repealed:

a) The Mining Code issued by Legislative Decree dated May 17, 1922, published in Official Journal number 183, took 93 of August 17 of the same year; as well as its subsequent reforms;

b) Supplementary Mining Law, issued by Legislative Decree number 930 dated January 16, 1953, published in Official Journal number 19, Volume 158 of the 29th of the same month and year, as well as its subsequent reforms; and;

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c) The Regulatory Law of the Extractive Process in the Cement Industry, issued by Legislative Decree No. 327 dated August 21, 1975, published in Official Journal number 156 Tomo 248 of August 26 of the same year and its reforms later.

Art. 76.-This Decree will enter into force eight days after its publication in the Official Journal.

GIVEN IN THE BLUE HALL OF THE LEGISLATIVE PALACE: San Salvador, at the fourteen days of the month of December of a thousand nine hundred and ninety-five.

MERCEDES GLORIA SALGUERO GROSS PRESIDENT

ANA GUADALUPE MARTÍNEZ MENÉNDEZ A L F O N SO A R I S T I D E S A L V A R E NG A VICE-PRESIDENT

JOSÉ RAFAEL MACHUCA ZELAYA JULIO ANTONIO GAMERO QUINTANILLA VICE-PRESIDENT VICE PRESIDENT

JOSÉ EDUARDO SANCHO CASTANEDA GUSTAVO ROGELIO SALINAS OLMEDO SECRETARY

CARMEN ELENA CALDERÓN DE ESCALA WALTER RENE ARAUJO MORALES SECRETARY SECRETARY

RENÉ MARIO FIGUEROA FIGUEROA SECRETARY

CASA PRESIDENTIAL: San Salvador, at the twenty-two days of the month of December of a thousand nine hundred and ninety-five.

PUBLISH, ARMANDO CALDERÓN SOL, President of the Republic.

MANUEL ENRIQUE HINDS CABRERA, Minister of Finance.

EDUARDO ZABLAH TOUCHE, Minister of Economy.

D.O. Nº 16 TOMO Nº 330 DATE: 24 January 1996.

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REFORM:

(1) D.L. NO 475, 11 JULY 2001; D.O. NO 144, T. 352, JULY 31, 2001.

EXTENSION: D.L. NO 456, JUNE 28, 2001; D.O. NO 130, T. 352, JULY 11, 2001. (Scan Licenses)

OAL/ngcl.