Procedure for getting Mineral Licence in Tanzania

Procedure for getting Mineral Licence in Tanzania

• Control over minerals on, in or under the land of the Tanzania mainland is vested in the United Republic. Authority is therefore required to be obtained from the licensing authority for prospecting, mining and trading in minerals.
• Section 6 of the Mining Act, 2010 prohibits any person to prospect or mine minerals without having a valid mineral right granted under the Act.
• The following mineral rights are granted under the Act prospecting licence, gemstone prospecting licence, retention licence, special mining licence, mining licence, primary mining licence, processing licence, smelting licence, and refining licence.
• Also, the Act permits holders of dealer licence and broker licence to buy, acquire, sell or dispose minerals. Furthermore the Mining (Mineral Trading) Regulations impliedly permits non-residents to acquire minerals from authorised miner, licensed dealer or from a Gem Trade Fair in Tanzania and export the same after fulfilling specified legal requirements

Who has the right to trade and/or export minerals?

• The following mineral right holders have the right to trade or dispose mineral products recovered: special mining licence, mining licence, primary mining licence, processing licence, smelting licence, and refining licence.
• Additionally, holders of dealer licence and broker licence have the right to buy, acquire, sell or dispose minerals as per Sections 76 and 83 of the Mining Act, 2010 respectively.
• the Mining (Mineral Trading) Regulations, 2010 permits a non-resident to export minerals acquired by him/her from authorised miner or licensed dealer by applying to the Commissioner for Minerals, upon payment of fees as set out in the First Schedule, for export permit for such minerals. In this case, a special export permit is issued to the applicant by the Commissioner for Minerals.
• Furthermore, the Regulations permits a non-resident to export minerals obtained from a Gem Trade Fair in Tanzania after payment of fees for the export permit for such minerals. The buyer is also supposed to provide proof of payment of royalty for the minerals to be exported.
• A non-resident with a Tourist Visa is permitted, under Regulation 16(2) of the Mining (Mineral Trading) Regulations, 2010 to export minerals (not more than twice a year) after paying the required export permit fee for minerals with value not exceeding USD 1,000. However, a much higher export permit fee is charged in case the value of minerals to be exported exceeds USD 1,000.
• Holders of broker licence are not authorized to export minerals.

What are the permits required for exporting minerals?

• Minerals or samples of minerals can only be exported by a mineral right holder or a licensed dealer. A non-resident with an ordinary, business or tourist visa can also export minerals acquired legally in the country after obtaining a special export permit from the Commissioner for Minerals.
• The following permits are a prerequisite for exporting minerals or samples of minerals from Tanzania:
• Export Permit: Export Permit for minerals or samples of minerals is issued by the licensing authority stating, among others, name of licence holder, licence number, type of minerals, net weight, value of minerals to be exported, certification for payment of royalty, date issued, validity of export permit and name of issuing officer.
• Export Permit for Minerals from Gem Trade Fair: permits non-residents to export minerals obtained from a Gem Trade Fair in Tanzania after payment of fees and royalty. In that case, an Export Permit for Minerals from Gem Trade Fair is granted by the Commissioner for Minerals.
• Certificate of Origin for Tanzanite Minerals: Regulations requires every Export Permit for Tanzanite to be accompanied by a Certificate of Origin issued by an authorized officer. The certificate of origin states, among others, name of licence holder, net weight and value of Tanzanite to be exported, date issued and name of issuing officer.
• Tanzania Kimberley Process Certificate: In the case of diamonds, every Export Permit for diamonds has to be accompanied by a Tanzania Kimberley Process Certificate granted by the Kimberley Process authorized officer from the Tanzania Kimberley Process Office under the Commissioner for Minerals.
• Special Export Permit: the regulation requires a non-resident who wishes to export minerals acquired by him/her from an authorised miner or licensed dealer to apply for a Special Export Permit from the Commissioner for Minerals. However, in case of a non-resident with a Tourist Visa, a different fee applies for exporting minerals with value not exceeding USD1,000. The same Regulation prohibits the tourist to be issued with a Special Export Permit for more than twice in a year. In any of the cases above, evidence for payment of royalty for minerals to be exported has to be provided by the exporter.

Note

• Every permit to export minerals or samples of minerals has to be accompanied by authentic Invoices and Government Exchequer Receipt Vouchers (ERVs) for export permit’s application fee and royalty payment.
• Regulation 5(4) of the Mining (Mineral Trading) Regulations 2010 requires every permit to export minerals or samples of minerals to be surrendered by the holder to a Government Official (Customs or Postmaster) at the point of exit from Tanzania. The original permit has to be forwarded to the authorized officer by whom it was issued

Mineral Opportunities available

• Minerals available in Tanzania include gold, diamonds, gemstones (such as rubies, aquamarine, tanzanite, sapphire; emerald, rhodolite, opal, zircon, alexandrite, garnets, tourmaline, spinel, peridot, iolite) Iron and Base metals (nickel and cobalt), platinum group metals: (platinum, palladium and Rhodium), Industrial minerals (soda ash, kaolin, salt along the Coast and inland lakes, vermiculites, limestone, silica sands, phosphate, gypsum, mica, dimension stones i.e. granites, travertine, marbles, quartzite) and coal resources
• Gemstones are abundant in the south, north and north east coast offer great potential, though full potential of the sub sector has not been realized.
• In the southern areas of Tanzania, at Tunduru and Songea Districts, precious gemstones such as saphire, alexandrites, ruby etc are abundant in alluvial soils.
• Matombo mountains and Mahenge areas in Morogoro region, are rich with deposits of ruby known all over the world as Matombo ruby.
• Areas of Tanga regions along Umba river are known by their potential for green garnets
• Arusha region at Mererani and Mbughuni produce the famous tanzanite, a rare ruby found in Tanzania only. Other gemstones that are found in the area include rhodolite and tsavorite.
• Tanzania also boasts of deposits of coal, tin, phosphates, nickel, cobalt, copper, gypsum and pouzzolana.

Note

• Except for the tanzanite mining that has both mechanized and semi-mechanized production, mining of all other gemstones found in alluvial soils are controlled by approximately 50,000 small miners who uses hand tools and equipment.
• The opportunity for mining is in finding investors especially in locations e.g., Muheza and Chunya with gold deposits that lack a serious investor or venture partner who can collaborate with artisanal miners.

Big international companies that are involved in mineral prospecting include

• Kahama Gold Mines Corporation,
• Ashanti Goldfields Limited,
• Resolute Limited, Afrika Mashariki Gold Mine,
• Anglo – American Minerals,
• Tanganyika Gold Mines, Pangaea Minerals,
• Kiwira Coal Mines as well as
• Williamson Diamonds Limited.

Setting Up Business in Tanzania

• The process of setting up business in Tanzania starts from the business identification process. This is followed by creation of a business entity ( a Company) and obtaining relevant licenses and approvals. ( A lawyer will help us set up the company)

Business License

• The type and number of required licenses differs from one sector to another depending on the degree of regulation in the sector involved. Generally, for mineral, each type of mining tenement requires to be licensed separately from the other. For example, the right to conducting prospecting must be licensed separately from the right to carry out mining. Depending on the nature of the business, you may be required to possess more than one license.
• The following mining tenements are prescribed under the law : Prospecting License; Retention License; Special Mining License; Mining License; Gemstone Mining License; Primary Prospecting License; and Primary Mining License.
• In addition to above licenses, the law provides for dealers and brokers licenses that may be granted to those dealing in raw gold, gemstone and other minerals. With regard to diamonds, there are special rules governing licensing and trading.
• The application for any of the above mentioned licenses must submit to the Minister responsible for minerals in prescribed form.

Fees for exportation of minerals

Permit of minerals or samples of minerals		USD 100
Special permit of minerals for non-resident (for minerals worth more than USD 1,000)		USD 2,000
Special permit of minerals for non-resident with Tour-ist Visa (for minerals worth not more than USD 1,000)		USD 200
Special permit of minerals purchased at a Gem Trade Fair		USD 200

NOTE

Apart from fulfilling the sector specific requirements, all businesses must obtain a general business license‟ issued under the Business Licensing laws.

Registration with Tax Authorities

• Once a company has been incorporated by the Registrar of Companies, the company is required to register with the nearest Tanzania Revenue Authority (TRA) office. The first document that must be issued by TRA is Tax Identification Number (TIN). Normally, Tax Identification Number is issued within three days.
• Once the Tax Identification Number has been issued, the tax file will be opened. Once a file number has been issued, the company is expected to complete provisional tax return forms. These have to be submitted within three months of the initial accounting date. The company must estimate its profits for the first year and make quarterly provisional tax payments. Once a file number is issued, TRA will issue an Income Tax Clearance Certificate, which can be used to obtain the general business license.

How to get started

To assist us go smoothly and kick start the business, I have credible people with sufficient experience to take us through all these processes. Please give us a call or contact us here, we will get back to you within 24 Hours.