Tanzania names chairperson for new mining commission

19th April 2018 By: Reuters

DAR ES SALAAM – Tanzanian President John Magufuli on Wednesday appointed a chairperson and commissioners for the country's new mining commission, paving the way for the issuance of new mining licences.

Africa's fourth-largest gold producer is seeking a bigger slice of the pie from its vast mineral resources by overhauling the fiscal and regulatory regime of its mining sector.

Magufuli sent shock-waves through the mining community with a series of actions since his election in late 2015, which he says are aimed at distributing revenue to the Tanzanian people.

In July last year, he suspended the issuance of all new mining licences until the new mining commission was in place.

The President on Wednesday appointed Idris Kikula, a former vice chancellor of a state university as chairperson of the new mining commission and also named eight commissioners to serve under him.

A statement from the Tanzanian presidency said these appointments would take effect immediately.

The appointment of the mining commission and new regulations published in January mean the country can now resume issuing new mining licences to investors.

Under legislation passed in July last year, the mining commission has been given extensive powers to regulate and monitor the mining industry and mining operations in Tanzania.

The legislation which created the commission says one of its key objectives is "to advise the government on all matters relating to the administration of the mineral sector with the main focus on monitoring and auditing of mining operations to maximise government revenue."

The commission is also charged with curbing smuggling of minerals and tax evasion by mining companies and has powers to suspend and revoke mining exploration and exploitation licences and permits.

It will also monitor and audit both the quality and quantity of minerals produced and exported by large, medium and small-scale miners to determine their tax liabilities.

The commission will be required to audit capital investment and operating expenditures of large mines, sort and assess values of minerals produced for tax purposes.

It will also produce indicative prices of minerals with reference to local and international markets for the purpose of assessment and valuation of minerals and assessment of royalties.

Passage of the legislation for the commission followed months of wrangling between the government and the country's biggest gold miner, London-listed Acacia Mining Plc, over mineral exports.

Tanzania accused Acacia of massive tax evasion in 2016. Acacia, which denies all allegations, said it was seeking an adjudicator to resolve its dispute with the Tanzanian government.

The government launched talks with Barrick Gold Corp, Acacia's majority owner, last year to try to resolve the dispute.