The mining industry in Cameroon is rich and diversified. Indeed, the Cameroonian territory abounds in a diversity of exploitable and marketable mineral substances such as iron, manganese, rock titanium, chromium, vanadium, copper, lead, zinc, cadmium, germanium, iridium, selenium, tellurium and molybdenum. It also has an abundance of tin, tungsten, nickel, cobalt, platinoids gold, silver, magnesium antimony, barium, boron, fluorine, sulphur, arsenic, bismuth, strontium, mercury, titanium, zirconium in sand, rare earths, coal and other fossil fuels, uranium and other retroactive elements, phosphate, bauxite, sodium and potassium salts, alum, sulphates other than alkaline earth sulphates. Additionally, it has minerals mined for industrial uses including marble, limestone and any industrial or ornamental rock, chalcedony and opal, ruby, sapphire, emerald, garnet, beryl, topaz and any other semi-precious stones and diamond.

The mining industry in Cameroon is still underexploited, despite the will of the government to make Cameroon one of the key mining countries in Africa through the production, transformation and commercialisation of its mining resources for the socio-economic development of the country. Indeed, a small percentage of the mineral substances in its territory are exploited through artisanal mining. However, no industrial mining project is in operation.

The mining industry in Cameroon is mainly operated by individuals for artisanal mining and junior companies for industrial mining. However, the State also participates through SONAMINES, which is the public company in charge of the State’s interests in the share capital of mining companies.

The mining industry in Cameroon is attractive. The Mining Code, for example, establishes a system of fiscal and customs incentives for investors in both the exploration and exploitation phases of their mining projects.

The mining industry in Cameroon is constantly developing and evolving with different actors, notably the government, Parliament, mining companies, civil society and mining craftsmen taking part.

The Cameroonian legal system is based on civil and common law. Mining legislation in Cameroon (mainly Law No 2023/014 of 19 December 2023 (the “Mining Code”)) is inspired by several sources, namely:

• international standards of extractive governance;
• the Extractive Industries Transparency Initiative (EITI) Standard (the “EITI Standard”);
• the Kimberley Process;
• general African Union mining policies;
• the Dodd–Frank Act; and
• the principles of sustainable development and good practice recommended in the mining sector by the World Bank in its Extractive Industries Good Practice Guidance.

The EITI Standard is an international standard that aims at transparency for oil, gas and mining resources in different countries.

The Kimberley Process is an international rough diamond certification scheme that brings governments, civil society and the diamond industry together to prevent the purchase of diamonds on the world market by rebel movements to finance their military activities.

General African Union mining policies are mainly reflected under the Africa Mining Regime Vision, which is a common public policy document adopted at the African Union Heads of State Summit in February 2009 in Addis Ababa, Ethiopia, that aims to ensure the fair and optimal exploitation of mineral resources for broad-based sustainable growth and socio-economic development.

The Dodd–Frank Act is a 2010 US law applicable to extractive companies listed on the US stock exchange.

In line with the provisions of the Cameroonian Civil Code, ownership of the soil entails, in principle, ownership of the top and bottom.

However, mineral substances are an exception to this general principle as any mineral substance contained in the soil and subsoil of the territory of the Republic of Cameroon are the property of the State, which exercises sovereign rights therein in line with the provisions of the Mining Code. The State is the only authority entitled to grant mining permits.

The State has several roles in mining in Cameroon:

• grantor-regulator through the Ministry of Mines, Industry and Technological Development; and
• owner-operator through the public company SONAMINES.

The Mining Code provides for a mandatory minimum 10% shareholding which is free of charge, in all operating mining companies, and the State can increase its stake to 25% shareholding (which is not free of charge).

The Cameroonian Constitution provides that the regulation of mining matters is regulated under the law. However, mining rights are derived from the Mining Code, the Mining Convention and the specifications of the exploration permit.

The granting authorities in Cameroon are as follows.

• The Minister of Mines who is in charge of the issuance of the following mining titles: reconnaissance, research, small-mine exploitation permits, mineral and thermo-mineral water exploitation permits and geothermal deposits. He also signs the Mining Convention on behalf of the State.
• The President of the Republic who is in charge of the issuance of an exploitation permit for an industrial mine, and an exploitation permit for an industrial quarry.
• The regional delegates of the Ministry of Mines, Industry and Technological Development who are in charge of the issuance of artisanal mining permits and semi-mechanised artisanal mining permits.

However, there are cases of overlapping jurisdiction, notably in the following cases.

• Authorisation for semi-mechanised artisanal exploitation of precious and semi-precious substances can only be granted in a research permit by the Minister of Mines, after prior approval by the President of the Republic.
• A research permit is granted by the Minister of Mines only after the prior approval of the President of the Republic.

Security of tenure in Cameroon's mining sector is principally governed by the Mining Code and its complementary regulations. Security of tenure is generally guaranteed in Cameroon in the following way.

Term Length and Renewals

Exploration permits

These are initially valid for three years, renewable up to three times with each renewal not exceeding two years under Article 33 of the Mining Code with a possibility of obtaining an extension under certain circumstances for a further non-renewable period of two years under Article 34 of the Mining Code.

Mining permits

These are granted for a specific duration (determined by negotiated outcome in the Mining Convention under Article 40(2) and could be renewed for a period negotiated and provided for in the mining agreement with the State under Article 40(4)(7).

Rights to progress from exploration to mining

Holders of exploration permits have the right to apply for a mining permit if they discover and can prove the existence of economically viable mineral deposits under Article 42(1) of the Mining Code.

The government has the right to revoke the mining permit if the permit holder fails to meet specific conditions.

Maintenance Requirements and Cancellation Procedures

Permit holders have to maintain a certain level of activity and investment to retain their rights. Failure to comply with these obligations can lead to suspension or cancellation of the permit. Cancellation procedures involve a formal process with opportunities for the permit holder to address the reasons for cancellation.

Operating Control, Marketing and Transferability

Permit holders have significant operational control over their mining activities, subject to environmental and safety regulations. They generally have the right to market and sell mineral products, either domestically or internationally. Mining permits are transferable, but subject to government approval under Article 79(4) of the Mining Code.

Additional Considerations

Land tenure

Mining activities often occur on land owned by the State or customary land holders. Separate agreements are necessary to secure land rights.

Fiscal regime

The Mining Code outlines a fiscal regime including royalties, production sharing agreements, and corporate taxes.

Environmental and Social Responsibilities

Permit holders are subject to environmental impact assessments and social responsibility obligations.

The procedure for carrying out an environmental and social impact study is performed by firms approved by the Ministry of the Environment, which, in turn, issues an environmental certificate of conformity at the end of the process. This procedure is formalistic and costly, as the fees required are substantial and the timeframe for the issuance of the environmental compliance certificate is very long.

There are protected areas in Cameroon. Indeed, the issuance of an exploitation permit is subject to the prior completion of hydrogeological, geophysical, bacteriological and physico-chemical studies that define the conditions of exploitation and study the vulnerability of the water table in order to determine the protection and security perimeter.

The protection zones may be established by the Minister of Mines together with the administrations concerned, within which, prospecting, research and mining of mineral substances or quarries are prohibited.

The Mining Code addresses the issue of community relations in the context of mining projects by taking into account the impact of these projects on the economic, cultural, industrial and technological development of Cameroon and, more specifically, on the development of human resources and the development of local businesses, industries and youth employment.

The Mining Convention provides for specific local content, taking into account the needs of communities surrounding mining projects.

A special account for the development of local capacities has been set up under Cameroon's Mining Code. Its purpose is to finance Cameroon's economic, social, cultural, industrial and technological development through human resources development and the development of local businesses and industry.

Contributions to this account range from 0.5% to 1% of the mining company's total pre-tax turnover.

Prior consultation is mandatory and is done by mining operators in co-operation with the State and regional and local authorities, and civil society.

There are no communities that enjoy special protection from mining projects in Cameroon. However, in order to preserve their traditions, the rights of indigenous peoples are taken into account when a mining project is set up on their territory. They are consulted and are entitled to compensation in the event of expropriation.

It is usual to have community development agreements in Cameroon referred to under the relevant mining agreement. Indeed, the local populations affected by the project must be consulted first for the allocation of the land necessary for the exploitation of mineral substances and secondly to identify the needs of the locality and finalise the local content in the agreement.

Mining regulations in Cameroon include numerous rules relating to governance and transparency stemming from the EITI Standard and the Kimberley Process, as well as provisions relating to respect for the environment or at least sustainable development requirements.

Illegal mining is an issue in Cameroon particularly in the mineral-rich eastern and northern regions. According to the 2023 ENACT Organised Crime Index Report, high levels of corruption in Cameroon’s State institutions provide a safe haven for illegal actors. A complex criminal network is involved in illegal mining in the country. The network ranges from State and local administrative officials and political elites as well as unlicensed miners and exporters, to local residents and community members. The illicit transnational supply chain for illegally mined products involves Chinese companies and is aided by porous borders, regional conflicts, widespread poverty and entrenched corruption. Illegally extracted mineral resources are trafficked to China, the UAE and Vietnam through Douala and neighbouring countries.

Illegal mining poses significant disruptions to legal industrial mining production in Cameroon. Some of these disruptions include extractable resource depletion, operational delays faced by legal mining companies, environmental damage, security risks, and reputational damage.

Mining companies and the government respond to illegal mining with a combination of enforcement, preventative measures and socio-economic strategies. Mining companies tend to enhance their security measures like installing surveillance systems and hiring private security companies. Some companies also invest in community engagement by funding education and healthcare projects. The government usually reacts with law enforcement, military deployment, regulatory oversight and public awareness campaigns, sealing access to illegal mining sites, and jailing illegal miners.

In the Ngoura district in the eastern region of Cameroon, local people were angry at both the mining operators, and the traditional authorities and denounced the excessive monopolisation of their land by the mining operators to the administrative authorities. They felt that the mining operators were taking advantage of their mining permits to appropriate thousands of hectares of land in the villages.

On the other hand, the majority of industrial projects are still at the structuring phase and so far consultations with local communities are going well, and they are represented by civil society, local elites, and civil and traditional authorities such as Group ERAMET, LAFARGE, SINOOSTEEL, and CAMALCO.

The Mining Code provides that in order to ensure that mining and quarrying resources are exploited rationally and take the environmental impact into account, mining licence holders must:

• protect flora;
• reduce waste;
• manage waste in line with current legislation;
• reduce emissions of CO, CO₂, SO₂, NO, NO₂, HC and particulate matter from machinery as well as dust emissions;
• manage wastewater discharges, watercourse crossings and management of water bodies; and
• manage mine tailings and solid and liquid waste such as used oil, rags soiled by hydrocarbons, etc.

There is no climate change legislation related to mining that has been adopted or is under discussion. However, this is a major concern for Cameroon, which is a signatory to COP21 and other major international Conventions on climate change, and it is committed to the sustainable management of natural resources and adaptation and mitigation policies.

Several initiatives for the achievement of sustainable development objectives, notably measures related to the fight against climate change, exist in Cameroon. These include:

• reform of the normative and institutional forestry framework in order to align it with the requirements of sustainable management of forest resources in line with the resolutions adopted at the Rio de Janeiro summit in 1992;
• the promulgation of new laws relating to environmental management (eg, the Framework Law No 1996/12 of 5 August 1996);
• the creation of a Ministry of the Environment and Forestry;
• the establishment of a forestry policy document and realisation of a forestry zoning plan for southern Cameroon;
• the implementation of a National Environmental Management Programme (PNGE);
• the launch of the Forest and Environment Sector Programme (FESP); and
• the participation of Cameroon in the negotiations of the UN Framework Convention on Climate Change.

Discussions are underway in Cameroon on increasing demand for so-called energy-transition minerals such as cobalt, lithium, copper, and nickel (ie, more incentive measures for utilisation of electric vehicles).

Mining exploration and exploitation in Cameroon is subject to the General Tax Code and to a specific regime granting tax and customs advantages to mining companies.

The General Tax Code requires mining companies to pay the taxes and duties applicable to all companies, particularly corporate tax. In addition, during the exploration phase, the mining company is required to pay specific taxes such as the fixed fee for the allocation of exploration permits. This fixed fee is based on the surface area of the requested exploration perimeter and the annual surface royalty is payable no later than January 31 of each year.

During the exploitation period, the holder of the mining title is subject to a state concession fee at the beginning of each financial year. The cost of the royalty depends on the surface area of the mining title. However, an ad valorem tax will be paid on each mined resource.

The mining legislation does not distinguish between the taxation of national and international investors.

The Mining Code grants several advantages to mining companies depending on whether they are in the exploration or exploitation phase.

Tax incentives in the exploration phase include:

• exemptions from the business licence contribution;
• free registration of incorporation deeds, company extension deeds or capital increase deeds, and transfers of undeveloped real estate; and
• a VAT exemption on local purchases and on imports of materials and equipment directly related to mining operations appearing on a list drawn up jointly by the Ministry of Mines, Industry and Technological Development and the Ministry of Finance (subject to the presentation of a VAT exemption certificate issued by the tax authorities).

Tax incentives in the exploitation phase include:

• the payment of registration fees on the acts of creation of the company, extension and increase of capital over the course of a year;
• the application of accelerated depreciation at the rate of 1.25% of the normal rate for specific fixed assets, the list of which is fixed by a joint order of the Ministry of Mines, Industry and Technological Development and the Ministry of Finance;
• the extension of the duration of the loss carry-forward from four to five years; and
• the imposition of a zero rate of VAT on products destined for export when they are subject to this tax. However, products released for consumption on the local market are exempt from the duties and taxes levied on similar imported products.

Mining company deeds are exempt from registration and stamp duties until the first commercial production, with the exception of those relating to residential leases.

Transfers of capital gains on the transfer or sale of a mining project are subject to a 15% capital gains tax. This levy applies to all transfers, even outside Cameroon.

Investment in mining is attracted in the following ways:

• transparent regulation;
• administrative facilities;
• an attractive tax framework; and
• strengthening the infrastructure to support mining, exploration and development activities.

There are no special rules for the approval of foreign investments in Cameroon subject to declarations to the Central Bank and Ministry of Finance. However, there are restrictions for foreign investors in the mining sector in Cameroon.

Indeed, foreign legal entities and individuals operating in the mining sector cannot obtain a mining title in Cameroon unless they have an incorporation in Cameroon. To this effect, they cannot carry out any of the mining activities carried out by an artisanal miner, an operator holding a reconnaissance permit, a research permit, a small mine permit or an industrial mine permit without a company registered in Cameroon.

Cameroon is not a party to any treaty that specifically promotes and protects mining investments but is a party to treaties that promote and protect investments in general, including in the mining sector. These are:

• the bilateral agreement between the government of the Republic of Mauritius and the government of the Republic of Cameroon of 3 August 2001 on the reciprocal promotion and protection of investments: this agreement aims at creating favourable conditions for investments by investors from Cameroon and Mauritius in their respective territories;
• the agreement between Canada and the Republic of Cameroon of 2014 concerning the promotion and protection of investments: this agreement is intended to create favourable conditions for investments by investors from Cameroon and Canada in their respective territories;
• the agreement on trade, investment protection and technical co-operation between the Swiss Confederation and the Republic of Cameroon of 28 January 1963;
• the agreement between the government of the Republic of Cameroon and the government of the Republic of Mali of 18 May 2001 on the reciprocal promotion and protection of investments: this agreement aims at creating favourable conditions for investments by investors from Cameroon and Mali in their respective territories;
• the agreement between the government of the Republic of Cameroon and the government of the Republic of Guinea on the reciprocal promotion and protection of investments: the purpose of this agreement is to create favourable conditions for investments by investors from Cameroon and Guinea in their respective territories;
• the agreement between the government of the Republic of Cameroon and the government of the Islamic Republic of Mauritania on the reciprocal promotion and protection of investments: this agreement aims at creating favourable conditions for investments by investors from Cameroon and Mauritania in their respective territories;
• the agreement between the government of the Republic of Cameroon and the government of the Arab Republic of Egypt on the reciprocal promotion and protection of investments: this agreement aims at creating favourable conditions for investments by investors from Cameroon and Egypt in their respective territories;
• the agreement between the government of the Republic of Cameroon and the government of Romania on the reciprocal guarantee of investments: this agreement aims at creating favourable conditions for investments by investors from Cameroon and Romania in their respective territories;
• the agreement between the government of the Republic of Cameroon and the government of the Kingdom of Morocco of 24 January 2007 on the reciprocal encouragement and protection of investments: this agreement aims at protecting foreign investments in order to promote the economic prosperity of both countries;
• the agreement between the government of the Republic of Cameroon and the government of the Republic of Italy of 12 June 1999 on the reciprocal promotion and protection of investments;
• the agreement between the government of the Republic of Cameroon and the government of the Republic of Türkiye of 24 April 2012 on the reciprocal promotion and protection of investments;
• the agreement between the government of the Republic of Cameroon and the government of Great Britain and Northern Ireland of June 1982 on the reciprocal promotion and protection of investments;
• the agreement between the government of the Republic of Cameroon and the government of the Belgo–Luxembourg Economic Union of 27 March 1980 on the reciprocal promotion and protection of investments;
• the agreement between the government of the Republic of Cameroon and the government of the Federal Republic of Germany on the reciprocal promotion and protection of investments; and
• the agreement between the government of the Republic of Cameroon and the USA of 1 December 2003 on the reciprocal promotion and protection of investments.

Exploration activities in Cameroon are generally financed by the mining operators' equity at the exploration phase. These funds are generally derived either from the cash flow of the mining operator's parent company, from the cash flow of the mining operator, or from loans granted by the mining operators to local or foreign credit institutions.

Exploitation activities in Cameroon are generally financed by international lenders specialised in the mining sector.

The roles of the international and national securities markets are:

• to mobilise the savings needed to finance the exploration, exploitation and development of mining activities; and
• to attract potential investors to finance mining projects.

In Cameroon, mining tenements are granted by the State. To secure financing for exploration and development, companies often use the following methods.

Pledging of Tenements

Tenements can be pledged to lenders as security. However, this may require specific approvals from the Mining Authority.

Fixed Charges Over Mining Equipment

Specific mining equipment can be subject to a fixed charge, giving the lender a priority interest in those assets.

Floating Charges Over Inventory and Accounts Receivable

A floating charge can be created over a company's inventory and accounts receivable, providing flexibility but lower priority than fixed charges.

Perfection of Security

To perfect the various security interests in mining tenements and related assets, there are registration/notification requirements with the securities registry (RCCM). Failing to perfect the various security interests could result in enforcement difficulties.

Furthermore, to secure the mining tenements, it is necessary to legally secure the land over which the tenements have been granted.

In the coming years, the government intends to:

• implement the major first-generation mining projects that are being structured;
• develop the mining sector by strengthening the security of mining conventions, following a general audit that should propose a reorientation of the policy of awarding mining conventions to transnationals and the obligation to subscribe to contracts;
• actively support the best local companies that are themselves directly involved in the mining value chain, without subcontracting their conventions to foreign partners;
• provide systematic support to inter-professional organisations that oversee the artisanal sectors in the exploration, exploitation and marketing of gold, limestone and precious minerals (diamond, sapphire, corundum, etc) and in the mining industry;
• continue the inventory of the national geological potential through the production and updating of large-scale maps (scales greater than or equal to 1:200,000) to facilitate the exploration of deposits and the diversification of minerals and mining materials; and
• strengthen institutional capacity by fully upgrading the equipment of the national research laboratories in the sector.