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DOF body, NCIP sign data sharing agreement on mining royalties
The Department of Finance’s Philippine Extractive Industries Transparency Initiative and the National Commission on Indigenous Peoples (NCIP) on Thursday signed a data sharing pact on royalties paid by mining firms to their host IP communities.
At a ceremony in Manila, DOF Undersecretary Bayani Agabin, NCIP Chairperson Jennifer Pia Sibug-Las, and PH-EITI National Coordinator Mary Ann Rodolfo led the signing of the memorandum of understanding (MOU) for the collaborative development and implementation of a data sharing agreement on IP-related payment in the extractive industries.
The MOU seeks to improve transparency on IP-related payments to ensure that royalties to IP communities are properly recorded and monitored, giving confidence to host communities that mining companies are fulfilling their obligations.
PH-EITI estimated that royalties paid by miners to their host IP communities from 2013 to 2022 stood at P100 million per year, according to Rodolfo.
Agabin, however, said that “we think the figure is understated.”
“This is what the MOU seeks to address. We think it is much higher. With this MOA, if we are able to share data, then we will see the [whole] picture as to how much the royalties [really] are,” the Finance official said.
The PH-EITI was created in November 2013 through Executive Order No. 147, series of 2013.
Under the Philippine Mining Act of 1995, mining firms are required to secure the consent of IP communities in areas where they intend to perform extractive operations.
Section 17 of the Mining Act states that royalties must be negotiated and agreed upon between the host IP community and the mining firm and facilitated by the NCIP.
The law’s implementing rules further mandate that host communities must receive at least 1% of the gross market value of the extracted minerals.
Sibug-Las said that the MOU would empower IPs to have access to data on how much royalties they should be getting and sharing among members of their communities.
Improved transparency would also boost the confidence of foreign investors in the country's mineral sector, according to Agabin.
“We expect it to give confidence to our foreign investors because when foreign investors… go to a country, they also look at the governance structures,” he added.
The proposed measure seeking to reform the mining fiscal regime also provides “institutionalizing transparency as a measure to improve the attractiveness of the mining industry in the Philippines,” according to Agabin. — VBL, GMA Integrated News
