Last Updated January 30, 2019

Law and Practice

Contributed By GENI & KEBE

Authors



GENI & KEBE GENI & KEBE is Senegal’s oldest law firm, having been established in 1912. It has three offices in Senegal and one in Côte d’Ivoire. GENI & KEBE’s lawyers are qualified to practise in the 17 states of the Organisation for the Harmonisation of Business Law in Africa (OHADA) and the firm is also a member firm of DLA Piper Africa. Mining law is a major sector for the firm, given its significance to African economies. It advises a wide range of mining operators in relation to exploration licences, regulatory compliance, government relations, risk mitigation and environmental approvals. The advice also covers related corporate issues, such as project finance, tax, land acquisition and litigation, including on cross-border projects. GENI & KEBE is the only law firm with an office in the first mineral region of Senegal (Tambacounda), to assist its mining clients located there.

On principle, there are no special rules or taxes for foreign people or companies, except for specific provisions provided by international tax conventions. Companies are subject to the local fiscal regime. In addition, people are subject to the local fiscal regime as tax residents. If they are not tax residents, they are in principle subject to non-commercial benefit tax (BNC) regarding their revenues. On the other hand, a repatriation tax is due to the State from foreign people residing in Senegal during their stay, which is paid once.

Mining activities may be prohibited in protected zones established by order of the minister in charge of mines.

Mining activities may be restricted in classified forests.

Indigenous and ethnic communities benefit from mining revenues through the Support and Equalisation Fund (20% of mining revenues) and the Local Development Support Fund (0.5% of turnover excluding taxes realised by mining companies). In addition, they have the right to be indemnified when their ownership is affected as landowners (as mentioned in 3.3 Rights Acquired by the Title Holder).

Prospection authorisation can be revoked for breach of any obligation provided by the Mining Code. An exploration right can also be revoked for breach of any obligation provided by the Mining Code, including suspension of activities for six months without legitimate motivation or persistent inactivity, no payment of taxes and royalties, and lack of requesting a mining right while there is proof of a commercially exploitable deposit. An exploration right may also be revoked in the case of transfer of this right without prior approval by the Ministry of Mines and Geology.

The mining right can be revoked because of continuing inactivity, suspension or serious restriction of mining without reasonable grounds; illegal acquisition of right, including by corruption; non-payment of taxes or royalties; lack of regular register of sale of mining products; and for a legal or contractual breach, including a serious breach of health, security and environmental rules. In addition, the mining right can be revoked in the case of transfer of this right without prior approval of the Ministry of Mines and Geology.

In addition to state free carry rights of 10% in the mining company, the following taxes and royalties must be paid by title-holders, except in cases of specific tax-exemptions:

  • entrance fees;
  • mining royalties;
  • reimbursement of a historic exploration activity;
  • surface royalties;
  • value-added tax;
  • corporate tax;
  • income tax from salary;
  • land taxes;
  • export taxes; and
  • taxes relating to the transfer of mining rights.
GENI & KEBE

47, Boulevard de la République
Immeuble Sorano, Dakar, 15023
Postal Address : BP 14392, Dakar, Sénégal

+221 33 821 1916

+221 33 842 62 75

info@gsklaw.sn www.gsklaw.sn
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Authors



GENI & KEBE GENI & KEBE is Senegal’s oldest law firm, having been established in 1912. It has three offices in Senegal and one in Côte d’Ivoire. GENI & KEBE’s lawyers are qualified to practise in the 17 states of the Organisation for the Harmonisation of Business Law in Africa (OHADA) and the firm is also a member firm of DLA Piper Africa. Mining law is a major sector for the firm, given its significance to African economies. It advises a wide range of mining operators in relation to exploration licences, regulatory compliance, government relations, risk mitigation and environmental approvals. The advice also covers related corporate issues, such as project finance, tax, land acquisition and litigation, including on cross-border projects. GENI & KEBE is the only law firm with an office in the first mineral region of Senegal (Tambacounda), to assist its mining clients located there.

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