Frequently Asked Questions on Executive Order 79 (Mining Reform)

What are the benefits of Executive Order 79?

The Executive Order:

• Sets the policy framework that will guide government and other stakeholders in the implementation and operationalization of mining laws, rules and regulations. It also provides concrete steps and solutions to major issues and concerns of the mining sector.

• Sets the direction and lays the foundation for the implementation of responsible mining policies.

• Aims to improve environmental mining standards and increase revenues to promote sustainable economic development and social growth, both at the national and local levels.

What was the process in involved in the drafting of Executive Order 79?

In October 2011, a mining study group was constituted, which included the Executive Secretary and several members of the Climate Change Adaptation and Mitigation Cabinet Cluster.

Input from different stakeholders were obtained, including those from the following: mining companies and allied industries and services; environmental CSO/NGOs; church groups (e.g., CBCP, Association of Major Religious Superiors of the Philippines); members of the academe; LGUs (e.g., major LGU leagues and other local government officials); different government agencies concerned with mining (i.e., through the Climate Change Adaptation and Mitigation and Economic Development Cabinet Clusters.)

Numerous studies, positions papers and commentaries were also secured and considered by the Study Group and the Cabinet Clusters. All the recommendations and input received were considered in the drafting of the provisions of EO 79.

Does the EO call for a ban or moratorium on mining?

No. Existing mining operations and those with approved contracts before the effectivity of the EO will not be affected, and the government will respect the agreements it has entered into, provided that they comply with existing laws and rules and the new mandates and directives of the EO and mining policies, and that these existing mines are not in areas expressly prohibited by existing laws, in which case appropriate action for violators will be undertaken.

EO NO. 79 identifies specific zones closed to mining applications, either for contracts, concessions or agreements. These include:

• Areas in the National Tourism Development Plan

• Critical areas and island eco-systems

• Prime agricultural lands covered by RA 6657

• Strategic agriculture and fisheries development zones and fisheries development zones and fish refuge and sanctuaries declared as such by the Department of Agriculture

• Areas already identified under the existing laws on mining, agrarian and protected areas, as well as in sites that may be determined by the Department of Environment and natural Resources (DENR)

Under the EO, no new mining operations will be approved in Palawan, consistent with the following:

• Existing laws such as RA 7942 (Mining Act) and RA 7586 (NIPAS Act)

• Critical areas, island ecosystems, and impact areas of mining that will be declared by the DENR based on existing laws, rules and regulations

• The ecological uniqueness of Palawan’s flora and fauna and the need to protect the same is recognized

• RA 7611 or the Strategic Environmental Plan for Palawan calls for the protection of Palawan’s environment and natural resources

• Recognition of its potential for other forms of investments (eco-tourism such as the Puerto Princesa Underground River)

While existing mining operations will be allowed to continue, the government will be suspending the granting of new mineral agreements until existing mining laws are amended.

Mineral Agreements, as provided for in the Mining Act of 1995, are any of the following: a) Mineral Production Sharing Agreement (MPSA); b) Joint Venture Agreement (JVA); and, c) Co-Production Agreement (CPA). The Mining Act also provides for Financial and Technical Assistance Agreements (FTAA) that the government may enter into. These agreements usually include a permit to explore for mineral deposits as part of the provisions and privileges granted in the contract in preparation for possible mining operations.

Amendments to mining laws will allow for the rationalization of existing revenue-and benefit-sharing schemes and incentives given to mining companies to ensure that the country benefits from the rich mineral resources in its territory. The additional revenues will allow government to have additional funding for other social services such as education and health, in addition to having funds for measures to mitigate the impact of mining on the environment.

While the granting of mineral agreements has been suspended, Exploration Permits may still be granted by the DENR.

An Exploration Permit is an authority granted by the DENR-MGB to allow a person or entity to conduct exploration for minerals in a specified area. This is limited to exploration works only and does not include authority to conduct actual mining or extraction of minerals. However, those who are granted Exploration Permits and who actually discover minerals shall be given preferential option in the grant of a mineral agreement should they wish to pursue the same.

Why can’t the government enter into new mineral agreements since amendments to the existing mining laws have yet to be legislated?

Entering into mineral agreements now in the absence of amendments to mining laws will bind the government to possible 25- to 50-year terms that will not give us maximum benefits from the mineral resources. This will allow future administrations and future generations to realize the full benefits of mineral resource utilization and not be bound by decisions and agreements made in the past.

What will happen to existing and pending applications for mineral agreements?

Pending applications for mineral agreements will not be granted and approved by the DENR-MGB. These may, however, be converted into Exploration Permit applications to allow them to conduct initial exploratory work.

Why did the law impose only a 2% excise tax on mining?

The 2% excise tax on mining, implemented through a revision of the National Internal Revenue Code, was meant to spur and attract mining investments in the country at a time when mineral prices were down and the industry was at a stand-still. The current rate needs to be reviewed to allow the government to maximize returns from mining, and legislation should explore the possibility of providing flexibility in the imposition of excise tax rates through a progressive tax system similar to what is implemented in other mining countries.

What is the impact of the new EO on current government mining revenues?

Current revenues from mining will be maintained since the EO allows existing mines and operations to continue. In fact, because of other revenue-raising measures in the EO and directives, mining revenues should increase despite the deferment on the grant of new agreements as provided for in the EO.

Is there already a draft bill/legislation on these revenue measures?

The DOF has been crafting the proposed legislation to rationalize the revenue and benefit sharing-schemes and incentives given to mining companies. The DOF is also considering inputs from an IMF Technical Assistance Study and mission on mining taxes and fees in the Philippines. Once finished, the Administration plans to prioritize the passage of this legislative measure.

What measures were put in place to address the country's economic or revenue-related concerns?

• Establishment of Mineral Reservations for strategic mineral reserves to be able to collect 5% additional royalties, or higher (Sec 5, EO)

• Opening of mining areas through competitive public bidding (Sec. 6, EO)

• Disposition of abandoned ores and valuable metals in mine wastes and mill tailings (Sec. 7, EO)

• Value-adding activities and development of downstream industries (Sec. 8, EO)

• Demand operational and financial reports from both large- and small-scale miners at all stages of the mining cycle (Directives to MICC)

• Conduct of verification at the national, regional and local levels of taxes and fees payable and monitoring of all entry and exit points of minerals in the country (Directives to MICC)

• Fast-track release and access of LGUs to their share from mining revenues (Directives to MICC)

• Updating of mineral commodity profile and database on new products, markets and available technologies (Directives to MICC)

• Conduct a study on existing mechanisms for benefit sharing and review of existing taxes, fees and incentives receive by mining companies (Directives to MICC)

• Study the terms and conditions of service contracts entered into by the Department of Energy (DOE) for energy resources for possible application for mining agreements (Directives to MICC)

• Study the imposition of higher export fees for metallic and non-metallic minerals in the country (Directives to MICC)

• Consider tapping 3rd party international auditors to validate the volume and value of mineral exports from the Philippines (Directives to Good Governance Cluster)

• Increase mine wastes and tailings and occupation fees and impose processing fees for all mining applications (Directives to DENR)

• Provide benchmarks for the valuation of minerals based on prevailing international minerals market prices (Directives to DENR)

• Prepare and maintain revenue baseline data and properly account for all taxes and fees generated from mining (Directives to BIR)

What specific legislative measures will the government pursue in light of the EO?

The following steps will be studied and undertaken for inclusion in the legislative measures:

• Rationalization of revenue-sharing schemes and mechanisms and incentives given to mining companies

• Bigger LGU shares from mineral resource utilization and providing better mechanisms for the faster release of their share

• Stiffer penalties for mining-related offenses

• Possible inclusion of medium-scale mining among the categories of mining

• Stronger regulatory rules over traders and middlemen to improve mineral production monitoring and collection of taxes and fees from mining

What measures were put in place to address the impact of mining on the environment?

• Stricter enforcement of environmental laws and rules, and holding violators accountable (EO and Directives to DENR)

• Identifying additional areas closed to mining

• Review of the performance of mining operations and cleansing of non-moving mining rights holders (Sec. 3, EO)

• Assess and improve small-scale mining conditions (i.e., establish minahang bayan, enforce compliance with environmental impact assessment requirements, limit mining to specific metallic minerals, prohibit the use of mercury) (Sec. 11, EO)

• Use of integrated maps and Programmatic Environmental Impact Assessment (Sec. 16 and 17, EO)

• Proper accounting of Environmental Protection and Enhancement Programs (EPEP) of mining companies (Directives to DENR)

• Use of geo hazard and multi-hazard maps and climate change forecasts in determining “go” and “no-go” areas (Directives to DENR)

• Explore use of mandatory and compulsory insurance coverage for mining affected areas and adoption of Comprehensive Environmental Response, Compensation and Liability Act of the USA (Directives to MICC)

• Resource accounting or full-cost benefit analysis (Directives to MICC)

What are the benefits of opening areas with known and verified mineral resources and reserves for mining through competitive bidding?

The public bidding of the granting of mining rights and tenements over areas with known and verified mineral resources and reserves will allow the government to negotiate for better terms in mineral agreements and allow it and the public to maximize potential benefits from mining. In addition, public bidding will ensure transparency and allow the State to deal with legitimate and serious mining investors and developers.

The specific parameters for the public bidding will be provided for in the IRR, taking into consideration existing best practices in current government bidding procedures and the principles of transparency and accountability.

The old procedure was simply done on a first-come, first-served basis, in that whoever applies or files first for an application for a mineral agreement or mining tenement; then he or she will exclude all others from that area applied for. This procedure allowed speculators to flourish, giving authority to sit and do nothing with their applications to the detriment of those who seriously want to pursue mining operations, and of the government for lost revenues and benefits for the people.

Are indigenous people’s rights vis-a-vis mining protected by the EO?

Yes. The EO reiterates the State policy on the recognition of IP rights (Whereas clause, EO) and the NCIP has drafted and issued its revised guidelines for the FPIC process. Close coordination with the NCIP will be undertaken to ensure its proper conduct and implementation for the benefit of all concerned stakeholders. In addition to this, the NCIP, DSWD and the DENR are directed to ensure that the social preparation for IPs to be affected by mining will be conducted (Directives to DENR, DSWD, and NCIP).

Complete cultural mapping to identify IP areas will also be undertaken to complete the ancestral domain delineation process.

Aside from tackling issues related to large-scale mining, does the EO address the concerns of small-scale mining?

Yes. Several measures were undertaken to address the issues concerning small-scale mining. These are:

• Reiteration of RA 7076 as the governing law in small-scale mining

• The constitution and operationalization of the P/CMRBs to ensure the proper management and regulation of small-scale mining operations

• The establishment of Minahang Bayan to provide specific and exclusive areas for small-scale mining to avoid overlaps and conflicts with other mining rights and tenements holders

• Small-scale mining of metallic minerals shall be limited to gold, silver and chromite since these are the most suitable for artisanal methods, which do not use equipment, machinery and explosives (the definition of small-scale mining per RA 7076 refers to mining activities which “do not use explosives or heavy mining equipment”)

• To help small-scale miners and to recognize them as a formal sector; training and capacity-building measures in the form of technical assistance will be conducted by concerned agencies.

How does the EO reconcile the roles of the national government and LGUs with regard to mining?

• The National Government shall coordinate and cooperate with the LGUs in ensuring the proper implementation of mining related laws, rules and regulations, especially as regards small-scale mining

• Concerned government agencies are directed to study possible legislation increasing LGU shares from the utilization of resources and to provide mechanisms to hasten the release of their shares through proper coordination between and among agencies

• The P/CMRBs will help LGUs properly regulate small-scale mining and provide an appropriate forum for the different stakeholders

• LGUs shall be a part of the MICC to ensure that their position and concerns are heard

What is the major role of the DILG in the implementation of the EO?

Sec. 12 of the EO directs the National Government, through the DILG, to work with LGUs to ensure that local ordinances are consistent with and conform to national laws, issuances, and policies, to ensure the proper implementation laws such as the mining act. Local ordinances should at all times be consistent with the Constitution and national laws and Sec. 12 recognizes the need for national laws and local ordinances to be harmonized to ensure the proper management and regulation of the mining industry.

Will local ordinances against mining be overturned/annulled/voided by the Administration pursuant to this Section 12 of the EO?

No, provided that they comply and are consistent with national laws, rules and regulations.

If found to have violated the law, the process of challenging an issuance through the courts will be pursued by the appropriate authorities. In addition, dialogue between the NG and LGUs will be crucial to avoid local ordinances being challenged in court.

My life is empty

[Full of text of speech delivered by Myrna Reblando during a discussion with journalists on “How the Prevention of Torture Promotes the Freedom of Expression and Journalism in Asia” held on June 25, 2012 at the Foreign Correspondents’ Club, Hong Kong]

Good afternoon everyone.

First, thank you all for coming to listen and to hear our stories.

I am Myrna Reblando, widow of Alejandro “Bong” Reblando. He is one of the 32 journalists murdered in the Maguindanao massacre. He writes for the Manila Bulletin, Reuters and Associated Press. Many people knew about this tragedy, but only few had extended help. Among the few are you: the journalists.

By writing stories and telling others about our loved ones, stories of ours and their families and our aspiration for justice, you also guide us in our struggle. What I have said in the past and what I would have to say now would not be effective had you not write about them.

I know I have a right to freedom of expression. We all should have. For my part, I am not a journalist like you. I am the wife of a murdered journalist who was silenced, who could no longer express his ideas and opinion. I am here with you to also use the tool that my husband has had: a freedom to express ones opinion, in pursuit of justice for him and others.

I fought to uphold this value and principle in many forms.

Inside the court rooms, I could remember in one of those hearings, the judge had asked me to leave because I cried during court hearings. She and others wants me to leave because they do not want to see me crying inside the court, again. I strongly insisted to stay to hear the trial. I told her that I did not kill anyone, I only wanted to listen. What can I do? I cannot hold my tears to fall down because of frustration.

In my interviews with journalists, what I speak is the truth, I speak my mind, I speak my heart and I never had any pretensions. To speak what is truth has had a heavy cost on me, my family and my children; however, I have also realize that not to speak the truth threatens our aspirations to obtain justice.

For over a year, I was in hiding. In this period, my life is empty. I felt that my person is useless and that I only think and secure myself. I felt that those who had threatened me had achieved what they wanted: to silence me, to push me back. I know that I could do something.

But to speak and not to speak, is where I had the dilemma. I am ready to die; however, I cannot put the life of my children at risk. I am their mother. I should be the one protecting them; I should be the one giving them protection. They have only me now; but I am not even with them now as we speak.

Two years ago, I first came here as a guest speaker of the Foreign Correspondents’ Club for their Human Rights Press Award. I received the posthumous award on behalf of the murdered journalists. At that time, I was not prepared. I was not able to explain clearly about what happened to my husband and others.

Before, I could speak freely and I thought I had freedom and protection. But now I am a person who is being hunted for what I have spoken and without protection even from my own Philippine government. Yes. I decided to leave my country because for person seeking remedies and redress in our system of justice, like me and many countless others, had no protection.

I am deeply thankful to the Government of Hong Kong for giving me protection, food and providing me shelter. Thank God now I am here alive, however, I could hardly imagine on how many occasions I was close to death in the last two years. I did not feel protected, even with my own security escorts.

In pursuit of justice, for me and my family the cost had been very, very heavy. I lost my livelihood, I cannot go home and the people whom I know could not provide me shelter when I needed the most. They fear of getting involved, even my own relatives and friends.

When I took the responsibility of being the vice chairperson and spokesperson for Justice Now! Movement, a group of families of the massacre victims, I know that it is a tough job. To speak on behalf of those who are frightened and those who could not – because of oppression, fear and absence of protection – is a position that is alarming and dangerous.

For those who choose to take this role in my country, most of them are all dead now; others are struggling to stay alive. One of those dead is Jessie Upham, one of the witnesses of the Maguindanao massacre. He was murdered before he could testify in court.

I had been, and hope to again be, very vocal and bold to attack all the wrongdoing evil of our government. It is sad that our government cannot protect their own citizens, especially those people living in rural and depressed areas. But I still hope that someday we will have a government that is able to lead and serve its own people better, to make us proud and for us to have peace in our country.

I did not live my life in vain. My person means a lot to me. I see my new role very, very interesting. I was not bitter despite of all the trials that come into my life. I strive hard to make the most of it. I reflect and study my surroundings to hear the wisdom of other people. I gain strength from them, too.

To express freely in pursuit of justice is possible. It is so where there are people who are willing to listen and hear;

Where there are people who picks from where others had left;

Who will speak for those who could not speak because they are oppressed and frighten;

Where people and groups lends their place, their time, with an open heart and mind for us – the people who are hunted for what we have spoken – to give us an opportunity to speak and express our opinions;

To all of us who are here, you never forget; we should and must not forget. You listened to and heard us.

Again, thank you all for being here with us.

Persons of criteria

By Fr. ROY CIMAGALA, roycimagala@gmail.com
July 3, 2012

This is what we have to aim at – to be persons of criteria, based on truth and charity – so that whatever situation we may be in, we would always feel confident and certain that what we are thinking, saying and doing is right and good, is helping us and others to reach our common good, both temporal and eternal, material and spiritual.

To be persons of criteria is to be persons who know how to distinguish between right and wrong, good and evil, fair and unfair, the essential and the incidental, etc.  Criteria as a term comes from the Greek word “krineo” which means to sort out, to separate, to distinguish.

In short, to be persons of criteria is to be persons who affirm, strengthen and develop their being persons not things, able to think, judge and reason out properly, and not just doing things mechanically or following things blindly.

They know how to distinguish the many elements and possibilities that go into any situation, and more importantly, know how to judge, how to choose what is truly good and wise for themselves and for all. In this way, they enhance their own freedom and joy, even if they have to ride out temporary difficulties and pains.

Persons without criteria are those who just follow the law of the jungle, who drift to an anything-goes type of lifestyle, allowing themselves to be dominated by feelings and passions alone, or social trends and fashions, not by reason, and much less by faith.

They seem stuck in some invincibly subjective condition, in a gripping state of self-absorption, detached from the objective, universal law that comes from God, our Creator and Father.

We have to be wary of our tendency, due to our weaknesses and other consequences of sin, both personal and social, to abort our growth into a mature person by ceasing or restraining in our lifelong effort to be persons of criteria, of correct convictions.

Nowadays, we even have public figures who not only have wrong criteria, but also flaunt them. They are, in fact, making aggressive action to proselytize others to their mistaken values. Worse, there now are countries that legalize and institutionalize these anomalies.

The world is getting very exciting and challenging. That’s another way of saying, it is sinking into more complex and complicated situations, with deep and vast confusion if not error reigning supreme.

Sad to say, aside from not giving any serious effort to correct this problem by studying, there’s also the trend to come out with half-baked ideologies that precisely give inadequate if not erroneous criteria.

Among the many things thrown into confusion in our world today are the questions about the existence of God, his abiding providence, the essence and role of law in our life, the essence, origin and purpose of our freedom and its intrinsic relation to obedience to God’s will.

Also many things related to our human nature are getting distorted if not totally ignored. That we are spiritual beings with a supernatural end, and not just material and social beings, that our reason and will are in need of a firm foundation found only in faith and charity, that our emotions should not be on their own but need to be directed by our reason and faith – these are a few examples of what we are not clear about these days.

In the end, we have to realize that for us to be persons of criteria, we need to be vitally linked to the living God, making use of the many and more than abundant instrumentalities made available to us.

We have the faith, we have Christ and his doctrine and example, the Holy Spirit who continues to abide in us, making God alive in us here and now, the Church with her sacraments and the various charisms to address all types of needs we have, etc.

We should not just depend on our rudimentary sense of good and evil that comes when we reach the age of reason or which is mainly dependent on social and cultural trends. Our sense of good and evil that makes us persons of criteria should be based on our living relationship with God, or on our faith.

It is faith that widens and deepens our understanding of things. It brings us to higher levels and aspects of reality not usually accessible to our senses alone, or even to pure reason. It brings us the spiritual and supernatural realities of our life.

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