The Mining Law Review: Chile

i OVERVIEW

Chile has a long mining tradition and it is well known for its world class mining deposits. It is the biggest producer and has the largest reserves of copper in the world and it has a significant production and reserves of molybdenum, lithium, silver, gold, iron and other minerals.2

In recent years, the mining industry has represented approximately 9 to 10 per cent of Chile's GDP3 and approximately half of the nation's exports.4 In addition, Chile has one of the highest rates of investment in mining exploration per territorial surface in the world.5

The Chilean government has traditionally been supportive of the industry and is constantly making an effort to promote the sector and develop relevant policies.6

The property of mines is mainly controlled by private companies, but state-owned companies, such as CODELCO,7 hold significant mines and large quantities of mining properties.

Concerning foreign investment, Chile has a solid and competitive economy, being the Organisation for Economic Co-operation and Development's first South American country and an active member of the Mercosur and the Asia-Pacific Economic Cooperation Forum. Chile has an open market and strongly incentivises foreign investment. The country has signed 29 trade agreements accounting for 67 per cent of the world's population and 88 per cent of global GDP.8

The state has the ownership of all mines, but private bodies may judicially request mining concessions to explore or exploit the minerals contemplated by law. In this regard, obtaining and maintaining title to mining concessions is not subject to administrative decision and it is the exclusive competence of judicial courts.

To develop a mining project in Chile, it is necessary to obtain several permits from different authorities. The time frame to obtain such permits may vary significantly depending on the characteristics of each project.

Mining is a sophisticated industry in Chile, implementing the latest technology, employing a remarkably qualified labour force, and applying the best security and compliance standards. These factors, plus Chile's advanced energy infrastructure, transportation network and strong legal framework, together with the quality of the mining resources and reserves, have made Chile one of the most important mining countries in the world.9

ii LEGAL FRAMEWORK

Mining is regulated by different laws. Nevertheless, the main statutes concerning mining are the Chilean Constitution, the Constitutional Organic Law Concerning Mining Concessions,10 the Mining Code11 and the Mining Code Regulation.12 These laws provide the basic framework of the Chilean legal mining system.

Concerning the execution of mining activities, applicable laws will depend on the particularities of each project. In this regard, some of the most important laws are: (1) the Mining Safety Regulation13 that regulates mining safety related issues; (2) the General Environmental Framework Law14 that regulates environmental matters and responsibilities; (3) Law No. 20,551 and its regulation,15 which regulate the closure of mining operations and installations; (4) Law 20,235, that regulates the figure of Competent Persons and creates the Competence Qualifier Commission of Mining Resources and Reserves; and (5) Decree No. 104 of 2016 of the Mining Ministry, that regulates the delivery of general information obtained from basic geological exploration works.

Regarding access to water, according to the Mining Code the owner of a mining concession has the right to use the waters found as a result of the mining activities performed within its concession, to the extent that such water is necessary for the exploration, exploitation or processing works that may be carried out depending on the type of concession. The use of other waters is subject to the general provisions of the Chilean Water Code.16

The main mining authorities in Chile are the Ministry of Mining, in charge of the design, execution and assessment of public mining policies and general promotion of the industry, and the National Geology and Mining Service, responsible for generating, maintaining and disseminating information on basic geology and geological resources, and for regulating and monitoring compliance with mining regulations regarding safety, property and closure plans. This Service establishes and gathers the basic geological exploration information that explorers must provide. Another relevant public entity is the Chilean Copper Commission, which advises the government concerning policies, strategies and actions that contribute to the development of the industry and oversees the interests of the state in its mining companies.

Concerning international treaties, Chile has signed mining treaties with Argentina and Germany. Other international treaties ratified by Chile that are relevant for mining are the Basel Convention, the Antarctic Treaty, the Convention on Wetlands of International Importance, the United Nations Convention to Combat Desertification, the Framework Convention on Climate Change, the Canada–Chile Agreement on Environmental Cooperation, and the International Labour Organisation's Convention No. 169 on Indigenous and Tribal Peoples.

iii MINING RIGHTS AND REQUIRED LICENCES AND PERMITS

i Title

According to Chilean Constitution, the Chilean state has absolute, exclusive, inalienable and imprescriptible ownership of all mines, regardless of the property rights over the superficial lands wherein such mines are located.

With a few exceptions established by law,17 in general any person or legal entity, without discrimination, is able to obtain mining concessions to explore or exploit all metallic, non-metallic and fossil substances located in the area of the relevant concession, with the only exception being liquid or gaseous hydrocarbons, lithium, deposits of any kind located in maritime waters under Chilean national jurisdiction, which cannot be accessed by tunnels from land, and deposits of any kind entirely or partly located in areas classified by law of importance for national security with mining effects.18 Such mining concessions can be subject to any valid contract and can be freely transferred, assigned and encumbered.

Exploration or exploitation of substances that cannot be subject to mining concession can be executed by the Chilean state or its companies or can be subject to administrative concessions or special operation agreements, in the terms and conditions established by the President by Supreme Decree.

ii Surface and mining rights

There are two kind of mining concessions in Chile, exploration and exploitation,19 and both are granted by means of a judicial process regulated by the Mining Code and its Regulation, which is characterised by being technical, based on a first claim priority system, and, with the only exception of some overlapping cases with other claimed or granted concessions, not allowing the intervention of third parties.20 In the case of exploration concessions, the process usually takes five to seven months, and in the case of exploitation concessions, 15 to 18 months.

Exploration mining concessions have a legal term of two years, unless prior to the expiry of such term the holder requests an extension for a maximum of two additional years upon waiver of half of the area of the concession. In case of exploitation mining concessions, they have an indefinite duration. Both types of concessions must pay an annual mining fee regulated by law. If this fee is not timely and fully paid, the concession enters a judicial process in which it can be auctioned or declared expired. Except for the payment of this fee, there is no other payment and no minimum investment or work requirement necessary to maintain title over mining concessions.

Claimed and granted mining concessions are immovable property, different from the property of the surface land, protected according to the Chilean Constitution by an ownership right, which can be enforced against the Chilean state or any third party, having its holder all legal remedies available under law to protect this ownership right. In some situations regulated by law, the state can expropriate mining concessions in a judicial process paying a fair market compensation to its owner.21

In general, there are no limitations concerning the ability of foreigners to claim or hold mining concessions in Chile. However, there is some discussion regarding whether foreign nationals of bordering countries can claim or acquire mining concessions located at the Chilean border.22

The holder of a mining concession or a treatment facility has the right to establish the easements described in Article 120 and following of the Mining Code over superficial land.23 These easements can be granted by agreement of the parties or imposed by a judicial process. In both cases, the relevant damages must be indemnified.

iii Additional permits and licences

In Chile, any person is entitled to dig test holes and to take samples in search of mineral substances in open and untilled lands, regardless of the land ownership, as long as the area is not located within a third-party mining concession. Any damages caused by these activities must be indemnified. If the area is not open and untilled, written permission from the owner or holder is required.24 If the permit is denied or if this faculty is obstructed, it is possible to ask for a judicial permit,25 but in case of houses and their outbuildings, or fields planted with vineyards or fruit trees, only the owner may grant the relevant permit. In this last situation, the owner's permit is required in general for mining exploration or exploitation.

The Mining Code also regulates different permits that are required to conduct certain mining activities in specific sensitive areas.26 Besides such permits, there are several municipal and sectorial permits that may apply to mining activities, which will depend on their nature and characteristics. Nonetheless, in most cases the main permit that it is required is the environmental permit, technically named the Environmental Qualification Resolution. This permit is granted by the environmental authority after an environmental assessment process, in which all public entities with environmental competence participate in a centralised manner, and citizen participation processes and indigenous consultations are performed when applicable. This process is conducted by the Environmental Assessment Service in collaboration with other relevant sectorial authorities.

iv Closure and remediation of mining projects

Pursuant to Law No. 20,551 and its regulation,27 a mining closure plan for mining projects must be approved by the National Geology and Mining Service, in accordance with the requirements established during the environmental impact assessment process of the project. The purpose of the closure plan is to assure physical and chemical stability of the abandoned mining facilities, mitigate any negative effects and protect the life, health and security of the people and the environment.

Financial instruments to guarantee the implementation of the closure plan – including the cost of the post closure measures and monitoring – shall be granted by the owner of the project since its beginning. This guarantee shall be kept and updated throughout the lifetime of the project and will be gradually returned to the project owner while the closure plan is implemented.

iv ENVIRONMENTAL AND SOCIAL CONSIDERATIONS

i Environmental, health and safety regulations

The Chilean Constitution establishes the right to live in an environment free of pollution, with the state having an obligation to protect the preservation of nature. This right can be enforced against the state and private bodies.

The Chilean state actively promotes the protection of the environment and sustainable development. In this regard, the country has enacted several laws regulating environment-related issues, with the most important being the General Environmental Framework Law28 and the Environmental Impact Assessment System Regulation.29 Likewise, Chile has subscribed to different international treaties relevant for the protection of the environment, such as the Paris Framework Convention on Climate Change, the Convention on Wetlands of International Importance or the United Nations Convention to Combat Desertification, among others.

The main Chilean environmental authorities are: (1) the Ministry of Environment, in charge of the design and implementation of environmental policies, plans and programmes; (2) the Environmental Superintendence, responsible for the control and enforcement of environmental regulations; (3) the Environmental Assessment Agency, in charge of the Environmental Impact Assessment System; and (4) the Environmental Courts, that are specialised courts competent to resolve environment-related judicial issues.

Concerning health and safety in mining operations, the Mining Safety Regulation30 is the primary applicable disposition, which regulates in detail the standards and rules in this regard. Compliance with this regulation is supervised and enforced by the National Geology and Mining Service. Likewise, the Chilean Labour Code and the Occupational Accidents and Professional Diseases Act31 regulate several matters concerning health and safety that are generally applicable in Chile, which also apply to mining. Such regulations are overseen and enforced by the Labour Directorate Agency.

ii Environmental compliance

Mining projects that consider a monthly production of over 5,000 tons of mineral shall obtain a favourable Environmental Qualification Resolution prior to the beginning of construction and operation.

For this purpose, the project owner shall submit the project to the Environmental Impact Assessment System, which consists of a sophisticated and centralised evaluation process, comprised by several steps and aspects, managed by the Environmental Assessment Agency. The process begins with the submission by the project owner of an Environmental Impact Declaration (EID), in case of projects that do not consider the generation of significant environmental impacts, or an Environmental Impact Study (EIS), in case of projects that consider the generation of significant environmental impacts. An EID is subject to a shorter and simplified assessment process, which has the purpose of assessing and ratifying the inexistence of significant impacts. This process usually takes from 6 to 12 months. An EIS is subject to a longer and more comprehensive process, to recognise, establish and evaluate relevant impacts and the corresponding mitigation, reparation or compensation measures. This process also considers citizen participation and, if indigenous communities are affected, a special consultation process. The EIS assessment usually takes from 12 to 24 months.

Depending on their technical capacities, different public entities will participate during the environmental assessment process with the purpose of reviewing and analysing the information submitted by the project owner from a technical standpoint, issuing their observations and requests regarding the project, according to their specific competence and standards. During the process, the project owner shall respond and clarify all the observations and requirements submitted by the relevant public entities. The final decision to grant a favourable Environmental Qualification Resolution to a project corresponds to an Environmental Commission headed by the Regional Supervisor and formed by several regional authorities. Against the Environmental Qualification Resolution there are administrative and judicial remedies available.

Compliance with the corresponding Environmental Qualification Resolution is supervised and enforced by the Environmental Superintendence. Sanctions or decisions imposed by the Environmental Superintendence can be challenged before the Environmental Courts.

In case of projects with a monthly production under 5,000 tons of mineral, a consultation letter, together with the corresponding supporting information, shall be submitted by the project owner to the Environmental Assessment Agency, that will decide if the project must enter the Environmental Impact Assessment System or not.

iii Third-party rights

Law No. 19,253 protects Chile's indigenous people and their territories. According to this regulation, the judicial granting of mining easements in indigenous lands requires the consultation and authorisation of the National Corporation for Indigenous Development. Chile has also ratified the International Labour Organisation's Convention No. 169 on Indigenous and Tribal Peoples. After a brief period of jurisprudential uncertainty, it has become clear that Chilean courts grant full enforceability to this instrument, especially regarding the indigenous communities' right to prior consultation. In this regard, the Environmental Impact Assessment System Regulation32 includes specific provisions requiring mandatory prior and informed consultation of affected indigenous communities during the environmental assessment of a project. This consultation is carried out by the Environmental Assessment Agency. If the project requires the displacement or relocation of indigenous communities, the acquiescence of these communities is needed.

Several mining projects have been brought before a court on grounds of lack or deficient consultation. As a good practice, many mining projects have implemented programmes to inform and allow participation of the relevant indigenous communities even prior to the submission of the project to the Environmental Impact Assessment System.

Courts have also acknowledged indigenous entitlement to lands, as well as water rights, based on ancestral possession of a territory. As such, it is important for a mining project to assess if the land over which mining property will be located can be disputed by indigenous communities.

Chile is member of the Inter-American Human Rights Protection System, so any person or community can resort to the Inter-American Commission and Court denouncing the violation of their human rights by the Chilean state. Chile has been brought before this system by some indigenous communities claiming that the state's environmental authorisation of mining projects in their territories has violated their human rights.

iv Additional considerations

The lack of community support (both indigenous and non-indigenous communities), particularly concerning environmental issues, has been a source of judicialisation and delay for mining projects in recent years. As such, the mining industry has devoted important efforts in the development of social licences. Mining companies have understood the necessity of a strong community relationship strategy, as well as the creation of formal cooperation agreements with the communities and initiatives to generate shared value.

v OPERATIONS, PROCESSING AND SALE OF MINERALS

i Processing and operations

The equipment and machinery used by the mining industry is mainly supplied through imports. In this regard, in general in Chile there are no limitations for the import of mining equipment or replacement parts. Nevertheless, the importing of explosives for mining purposes is subject to the previous authorisation of the General Directorate of National Mobilisation.

Imports in Chile are subject to a customs tariff of 6 per cent over cost, insurance and freight (CIF) value, but most of the trade agreements signed by Chile contemplate a lower rate or zero per cent import duties.

Concerning the processing of extracted minerals, there are no limitations, other than the applicable safety and environmental regulations. Nonetheless, according to the Mining Code, the Chilean state shall be notified of the existence of minerals that cannot be subject to mining concession under law, found during the processing of minerals. The state may demand that producers separate these minerals from mining products if they have a significant presence33 to be delivered to the state or sold on its behalf.34 Also, the state has a right of first refusal, at the customary market prices and terms and as regulated in the Mining Code, regarding mineral products when thorium or uranium have a significant presence,35 a situation that must be notified to the Chilean Nuclear Energy Commission.

As per the use of foreign labour and services in the mining industry, the Chilean Labour Code requires companies with more than 25 employees to have at least 85 per cent national employees. This limitation does not apply when hiring foreign permanent residents or foreign specialised technical staff.36 Regarding foreign service providers acting in Chile, in general they will be subject to the same laws as Chileans.

ii Sale, import and export of extracted or processed minerals

Chile has no general restrictions for the sale, import or export of extracted or processed minerals. Nonetheless, minerals considered as radioactive or nuclear substances, including lithium, can only be exported after the authorisation of the Chilean Nuclear Energy Commission. Also, for the import and export of copper and copper by-products, the Chilean Copper Commission must verify and inform its value to the National Customs Service.

iii Foreign investment

Law No. 20,848 establishes the framework for foreign direct investment in Chile. According to this law, foreign investors in Chile will be subject to the same common legal regime applicable to nationals and cannot be subject to arbitrary discrimination. Also, the Chilean network of international treaties provides most foreign investors with customs and tax advantages, further guarantees of non-discrimination, fair and equitable treatment protections, most-favoured-nation clauses, and recourses to investment protection bodies such as the International Centre for Settlement of Investment Disputes.37

One of the most relevant pieces of legislation for foreign investors in mining was Decree Law No. 600, which in certain cases permitted foreign investors to enter into a contract with the Chilean state to secure a fixed set of investment rules, taxation and other guarantees. This statute was abolished in 2015, and a new regime securing, among others, a maximum taxation limit was available for foreign investors until 2019. Although these regimes had been replaced by the current investment legislation, the legal framework established in those contracts is still valid and applicable for the foreign investors that subscribed them.

vi CHARGES

i Royalties

Mining companies with annual sales equal to or below the equivalent value of 12,000 metric tons of fine copper are exempted from any royalty. If the company's annual sales exceed the equivalent value of 12,000 metric tons of fine copper, a royalty is applicable, based on a progressive and incremental rate (between 0.5 per cent and 4.5 per cent) over the mining operational taxable income of the company. If the company's annual sales exceed 50,000 metric tons of fine cooper, the royalty to be paid will be defined according to a progressive and incremental rate (between 5 per cent and 14 per cent) to be applied over its mining operational margin.38

ii Taxes

Small-scale artisan mining is subject to an overall income tax at a fixed rate to be determined according to the average price of the minerals and the taxpayer annual sales. Medium-scale mining companies can decide between the regular taxation regime and taxation based on a presumptive income (to be determined as a percentage, ranging from 4 per cent to 20 per cent, over their net annual sales, according to the average price of the pound of copper in the relevant period). For these purposes, a company is considered medium-scale mining if its initial equity does not surpass approximately US$1.2 million, and its annual sales do not exceed approximately US$600,000. Large-scale mining companies are subject to Chile's general income tax regime, with a Corporate Income Tax of 27 per cent, unless the company is suitable to be considered in the Pro-Pyme Regime, in which case a 25 per cent tax rate will apply (to opt for this regime, among other requirements, the company's annual sales cannot exceed approximately US$2.6 million).

Concerning the owners of mining companies, according to the general income tax regime, Chilean residents' final income taxation (Global Complementary Tax) will be subject to a progressive rate between 0 per cent and 40 per cent. In the case of non-residents, their final tax (Additional Tax) will be withheld at a fixed 35 per cent rate. It will be possible to deduct as credit 100 per cent or 65 per cent of the corporate tax paid depending on different factors.

Until 2015, some foreign investors could sign a contract with the Chilean state according to Decree Law No. 600, which guaranteed tax invariability. Until 2019, there was also a tax invariability contract available for foreign investors. Rights and duties established on those contracts are valid and in force.

Regarding Value Added Tax, export of minerals or any other goods from Chile to a foreign country are exempted. Sales of goods and services in Chile, as well as imports, are subject generally to a 19 per cent Value Added Tax. Nonetheless, the import of capital goods can be exempted if they amount to an investment equal or greater than US$5 million, and they are used in the development, exploration or exploitation of projects associated to mining, energy, infrastructure, telecommunications, and others.

Law No. 21,210 introduced a new tax for the contribution to regional development. In this regard, all investment projects, including mining, involving an investment of US$10 million or more in fixed assets, that are subject to the assessment of the Environmental Impact Assessment System, shall pay a 1 per cent tax over the amount exceeding the US$10 million investment.

Chilean legislation also incorporates a green tax levied on sources emitting over 100 tons of particulate material per year or 25,000 or more tons of CO2 per year.

iii Duties

Exports are free from any kind of duty, and imports are subject to a customs tariff of 6 per cent over CIF value. Nonetheless, the import of capital goods is exempted.

As Chile has several free trade agreements in force, a 0 per cent or reduced custom tariff over CIF value of imports applies to imports subject to those agreements, when the corresponding certificate of origin is provided.

The import of gold, platinum, jewellery and gemstones is subject to an increased custom duty because of their luxury qualification.

iv Other fees

The owners of mining concessions must pay a yearly mining fee equivalent to approximately US$1.4 per hectare in the case of exploration concessions, and approximately US$6.9 per hectare in the case of exploitation concessions. The latter, however, within certain limits, can be credited to income taxes originated by the exploitation of the concession. Payment must be made during March each year. Lack of payment may cause the loss of the concession through its auction or expiry within a judicial process. Small-scale miners may apply for a reduced rate of this mining fee.

The Mining Code also establishes the payment of a mining procedural fee to be paid as a requirement within the constitution process of mining concessions.

vii OUTLOOK AND TRENDS

Among several initiatives, the Chilean government is currently working on the development of the Mining National Policy 2050, with the participation of public and private actors, to establish a new long-term sectorial policy based on four main aspects: (1) sustainable economic development; (2) social sustainability; (3) environmental sustainability; and (4) governance.

Concerning possible changes in legislation, the following are the most relevant for mining:

  1. Chile will perform a public referendum to decide if the Chilean Constitution should be replaced or not. If the replacement option prevails, a convention will be in charge of drafting the new constitution, whose members will be elected by a new referendum. It is not expected that a new constitution would significantly affect or modify the current mining legal framework.
  2. Changes to the Chilean Water Code, mainly to give water-use rights a temporary character, establish termination and expiry causes, and restrict some uses.
  3. The creation of a new royalty regarding copper and lithium production, consisting of a 3 per cent flat rate tax over the net value of the extracted minerals.39
  4. A limit to the right to use water found as a result of mining works in a mining concession in case of overexploited basins.
  5. The creation of a National Service of Biodiversity and Protected Areas.
  6. The modernisation and amending of the environmental legal framework and the Environmental Impact Assessment System.
  7. The regulation of glacier protection.

The pipeline of projects in Chile is still significant and there are relevant unexplored areas in the country, but the development of new projects has decreased in recent years, mainly because of the judicialisation of environment-related matters and community issues, new challenges of social licensing, the implementation and discussion of several legal reforms and social unrest in the country, all of which have increased uncertainty, as well as time frames and costs of the development of projects. In addition, the mining industry has been affected by the covid-19 pandemic, notwithstanding that the industry has been able to continue the operations subject to safety limitations.


Footnotes

1 Iván Bertrand-Galindo, José Tomás Barrueto and Milenko Bertrand-Galindo are partners at Bertrand-Galindo Barrueto Barroilhet & Cía.

2 Consejo Minero. Cifras Actualizadas de la Minería. June 2020. Page 4.

3 id., page 41.

4 id., page 43.

5 id., page 67.

6 One agency that plays a significant role promoting investment in all industries in Chile, including mining, is the Sustainable Projects Management Office.

7 CODELCO is the largest producer of copper in the world.

8 International Economic Relations Superintendence. Available at www.subrei.gob.cl.

9 COCHILCO, available at www.cochilco.cl.

10 Law No. 18,097.

11 Law No. 18,248.

12 Decree No. 1 of 1986 of the Mining Ministry.

13 Decree No. 132 of 2002 of the Mining Ministry.

14 Law No. 19,300.

15 Decree No. 41 of 2012 of the Mining Ministry.

16 Law-Ranking Decree 1,122 of 1981 of the Justice Ministry.

17 Notwithstanding general rules in Chile concerning legal capacity and some specific rules in that regard established in the Mining Code, according to such Code, based on national interest considerations, the following persons in certain situations cannot claim or hold mining concessions or shares of the mining companies specifically regulated in the Mining Code: (1) judges of Courts of Appeal, judges and secretaries of Civil Courts, custodians of mining registries, and employees or officials of said courts or registries, concerning lands or mining concessions totally or partially located in territories under their jurisdiction or competence, and shares of the above mentioned mining companies holding such concessions; (2) officials of the state, its agencies or its companies, that because of their position participate in the granting process of mining concessions or have access to geological, mining or mining discovery related information, up to one year after they have stop serving in such position; and (3) the spouse of any of the above-mentioned individuals, that is not perpetually divorced, or their family children. Nevertheless, these prohibitions will not apply in case of inheritance or if the acquisition occurs because of a title issued before the situation that causes the prohibition.

18 In addition: (1) mining concessions granted according to the previous Mining Code that are still valid could allow the exploitation of mineral substances that today according to law cannot be subject to mining concession if the relevant substance was subject to such concession; (2) the Mining Code regulates title to mining cuts, slag and tailings; and (3) surface clay, sand, rocks and other materials that can be directly used for construction, and artificial salt deposits, are not considered mineral substances for legal purposes.

19 Territorial extension of the mining concession comprises a solid whose top face is, in the horizontal plane, a parallelogram of right angles, and whose depth is unlimited within its vertical planes. The length or width of the parallelogram must have Universal Transverse Mercator (UTM) orientation north-south. The sides of mining concessions must horizontally have a minimum measure of 1,000 meters or any multiple thereof in case of exploration concessions (minimum surface of 100 hectares and maximum of 5,000 hectares), and 100 meters or any multiple thereof in case of exploitation concessions (minimum surface of 1 hectare and maximum of 10 hectares).

20 Please be aware that in case of overlapping of claimed or granted mining concessions, the corresponding legal actions must be judicially filed within the relevant legal term by the holder of the affected mining property to protect his or her rights.

21 For expropriation, a general or special law is required authorising confiscation based on public usefulness or national interest, qualified by the legislator.

22 For more details, please see Law Decree No. 1,939 of 1977 of the Lands and Colonisation Ministry.

23 It is also possible to use mining easements granted in favour of other mining concessions (as long as it does not prevent or make it considerably difficult to explore or exploit under the serving concession).

24 In case of public or municipal lands, permission must be requested to the pertinent Governor or Mayor.

25 There is also the possibility in certain cases to impose temporary superficial easements that are regulated by law.

26 These permits are regulated in Article 17 and following of the Mining Code. To obtain a judicial mining easement over these areas, the relevant permit is a requirement for the granting of the easement.

27 Decree No. 41 of 2012 of the Mining Ministry.

28 Law No. 19,300.

29 Decree No. 40 of 2012 of the Ministry of Environment.

30 Decree No. 132 of 2002 of the Mining Ministry.

31 Law No. 16,744.

32 Decree No. 40 of 2012 of the Ministry of Environment.

33 Legally, for this purpose it is understood that a mineral has significant presence if it can be economically and technically reduced or separated, meaning if the higher total cost involved in its recovery through proven technical procedures, its marketing and delivery, is less than its commercial value.

34 The state shall reimburse the relevant costs and in case that changes in the facilities or complementary facilities are required, shall also indemnified damages (any complementary facilities will belong to the state in that case).

35 Please see footnote 33.

36 To perform any kind of paid work in Chile, an individual will need the corresponding working permit, which can be obtained both at the Chilean consulates abroad or in Chile if the current visa does not contemplate such capacity.

37 Another relevant regulation to consider concerning foreign investment is Chile's Central Bank Organic Law No. 18,840, and its Compendium of International Exchange Regulations and Manual.

38 Legally, for this purpose 'mining operational margin' is the quotient, multiplied by 100, resulting from dividing the mining operational taxable income by the mining operational income.

39 According to the relevant bill, this royalty will not apply, in case of copper, if annual extraction does not exceed 12,000 metric tons of fine copper, and in case of lithium, if annual extraction does not exceed 50,000 tons of metallic lithium.

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