The Mining (Local Content) Regulations, 2018

Mining (Local Content)
GOVERNMENT NOTICE NO. 3 published on I0/01/2018
TT{E MINING ACT,
(cAP. 123)
REGULATIONS
(Made under sections 102 and 112)
THE MINING (LOCAL CONTENT) REGULATIONS,2Ol8
PART I
PRELIMINARY PROVISIONS
Regulation
1. Citation
2. Application
3. Interpretation
4. Objectives
Title
PART II
ADMINISTRATIVE PROVISIONS
5. Local Content Committee
6. Functions of the Committee
7. Local content requirements
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8. Interest of a citizen in mining operations
PART III
LOCAL CONTENT PLAN
9. Setting up of local office
10. Submission oflocal content plans for approval
1 1. Review of local content plan
12. Content of the local content plan
13. Minimum local content levels
14. Preference to indigenous Tanzanian companies
15. Basis of bid evaluation
16. Submission of proposed contracts
17. Submission of quarterly forecasts
18. Documents required during bidding process
19. Review of contract
20. Employment and Training Sub-Plan
21. Succession plan
22. Middle and junior level positions
PART IV
EMPLOYMENT AND TRAINING SUB-PLAN AND
SUCCESSION PLAN
PART V
PROGRAMME FOR RESEARCH AND RESEARCH
DEVELOPMENT SUB-PLAN
23. Programme for research, development and budget
24. Research and Development Sub-Plan
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PART \rI
TECHNOLOGY TRANSFER PROGRAMMES AND REPORTS
25. National plan on technology ransfer
26. Technology transfer programme
27. Technology Transfer Sub-Plan
28. Support for technology transfer
29. Technology transfer reporl
PART VII
LOCAL INSURANCE SERVICES CONTENT
30. Insurance and reinsurance
3 I . Approval of offshore insurance
PART VIII
LEGAL SERVICES CONTENT
32. Legal services
33. Legal Services Sub-Plan
PART IX
FINANCIAL SERVICES CONTENT
34. Financial services
35. Financial Services Sub-Plan
36. Operation of bank account in Tanzania
PART X
LOCAL CONTENT PERFORMAI{CE REPORTING
37. Requirement for submitting local content performance report
3 8. Assessment of performance report
39. Requirement for third party reporting
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PART XI
DATA AND INFORIVIATION ON LOCAL CONTENT
40. Establishment of a Common Qualification System
41. Object of the Common Qualification System
42. Availability of information
43. Public education
44. Communication oflocal content policies
PART XII
MONITORING, COMPLIANCE AND ENFORCEMENT
45. Electronic filing of documents
46. Establishment of guidelines and procedures
47 . Local content monitoring
48. Investigations
PARTXIII
FINAL PROVISIONS
49. Offences and penalties
50. Complaints to Minister
51 . Transitional provisions
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Citation
Application
lnterpretation
Cap.123
THE MINING ACT,
(cAP. 123)
REGT'LATIONS
(Made under seclions 102 and 112)
THE MINING (LOCAL CONTENT) REGULATIONS,2Ol8
PART I
PRELIMINARY PROVISIONS
1. These Regulations may be cited as the Mining
Local Content Regulations, 2018.
2.These Regulations apply to local content with
respect to mining activities.
3.ln these Regulations, unless the context
otherwise requires-
"Act" means the Mining Act;
"Award Notification Form" means a fomr issued by a
contractor or licensee to inform a successful
bidder of an award of a contract;
"bid rigging" means the manipulation of a bid process by
dishonest means;
"cartelization" means a collection of businesses that act
together as a single producer and agree to
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Cap. 123
inlluence prices for certain goods and services by
controlling the supply through production and
marketing activities;
"Commission" means the Mining Commission
established by the Act;
"Committee" means the Local Content Committee
established under these Regulations established
under these regulation;
"common qualification system" means a centralized
system of pre-qualiffing service providers in
mining industry based on capacities, capabilities
and local content strength to enable ranking and
categorization of the service providers as well as
tracking and monitoring their performance;
"contractor" means a person who has entered into a
mining agreement with the United Republic to
undertake mining exploration and production
activities under the Act;
"corporation" means the entity to be established or
designated as such to for purposes of holding
control of Government mineral assets;
"front" means to deceive or behave in a particular
mannerintended to conceal the fact that a
company is not an indigenous Tanzanian
company;
"in-country spend" means the amount of money spent in
Tanzania in relation to the mining activities
carried by the mining companY;
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Cap.2l2
"indigenous Tanzanian companyri means a company
incorporated under the Companies Act that -
(a) has at least fifty-one percent of its equity owned
by a citizen or citizens of Tanzania; and
(b) has Tanzanian citizens holding at least eighty
percent of executive and senior management
positions and one hundred percent of nonmanagerial
and other positions;
"licensee" means a person granted a licence to undertake
mining activities;
"local content" means the quantum or percentage of
locally produced materials, personnel, fi nancing,
goods and services rendered in the mining
industry value chain and which can be measured
in monetary terms;
"local content monitoring" means keeping track of, or
monitoring compliance with these Re gulations ;
"long term local content plan" means a local content plan
that covers a period of five years as specified in
the First Schedule;
"National Policy on Local Content" means the Local
Content and Local Participation in Mining
Activities Policy Framework issued by the
Ministry responsible for minerals;
"mining activities" means any activity engaged in within
and outside Taruanta related to the exploration
for, development and production of minerals, the
acquisition of data, mining and exEaction or
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Objectives
mining of minerals, storage, transportation and
decommissioning and the planning, design,
construction, installation, operation and use of
any facility for the purpose of the mining
operations;
"mining operations" means operations carried out in the
course of undertaking mining activities;
"mining industry value chain" means the processes
involved in the mining industry such as
exploration, development and production,
transportation, processing and markethg;
"qualified" means technical comp€tence and financial
capability to fulfil all obligations under a mining
agreement or mining license;
"subcontractor" means a third party to whom the
Corporation or a confiactor has entered into a
mining contract for the provision of services for
Mining operations;
"technical core staf includes geologists, engineers and
technicians;
"value-addition" means the economic improvement of a
product or service in the mining industry.
4. The objectives ofthese Regulations are to-
(a) promote the maximization of value-addition and job
creation tfuough the use of local expertise, goods
and services, businesses and financing in the
mining industry value chain and their retention in
Taszania;
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(b) develop local capacities in the mining industry
value chain through education, skills transfer and
expertise development, transfer of technology and
know-how and active research and development
programmes;
(c) achieve the minimum local employment level and
in-country spend for the provision of the goods and
services in the mining industry value chain as
specified in the First Schedule;
(d) increase the capability and international
competitiveness of domestic businesses;
(e) create mining and related supportive industries that
will sustain economic development;
(f) achieve and maintain a degree of control by
Tanzanians over development initiatives for local
stakeholders;
(g) provide for a robust and transparent monitoring and
repo(ing system to ensure delivery of local content
policy objectives;
(h) provide for the submission of the local content plan
and related sub-plans by contractors,
subcontractors, licensees and any other allied
entity involved in the mining industry including-
(i) the provision ofgoods and services;
(ii) the transfer to the Corporation or the
Commission and Tanzanians of advanced
technology and skills related to mining
activities;
(iii)a recruitment and training programme; and
(i) supervise and coordinate the implementation
and monitoring of local content.
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Local Content
Commiftce
Functions of thc
Commiftee
PART II
ADMINISTRATIVE PROVISIONS
5.-(l) There shall be established a Local Content
Committee for the mining activities.
(2) The Committee shall have the following members:
(a) one full time member of the Commission who
shall be the Chairman;
(b) the Director of Labour and Employment;
(c) a representative of the Tanzanian Private Sector
Foundation;
(d) the Chief Executive Officer of the Geological
Survey of Tanzania;
(e) the head of legai sewices department of the
Ministry responsible for Minerals; and
(0 the Executive Secretary of the Commission.
(3) The Chairman of the local content committee
shall be appointed by the Chairman of the Commission.
6.-(1) The Committee shall be responsible for
overseeing the implementation of these Regulations
and ensuring measurable and continuous growth in local
content in all mining activities..
(2) Without prejudice to the generality of subregulation
(1), the Committee shall-
(a) oversee, coordinate, and manage the
development of local content;
(b) prepare guidelines, to include targets and
formats for local content plans and reporting;
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Local co cnt
requirement
Intercst ofa citizen
in mining
operations
(c) make appropriate recommendations to the
Commission for smooth implementation of
these Regulations;
(d) set minimum standard requirements for local
content in local content plans where
applicable;
(e) undertake public education;
(f) undertake local content monitoring and audi!
and
(g) perform any other functions conferred on the
Committee by the Commission.
(3) The Committee shall submit quarterly reports
of its activities to the Commission.
7. A contractor, subcontractor, licensee, the
Corporation or other allied entity carrying out a mining
activity shall ensure thal local content is a component of
the mining activities engaged in by that contractor,
subcontractor, and licensee, the Corporation or other
allied entity.
8.-(1) An indigenous Tanzanian company shall be
given first preference in the gant of a mining license
with respect to mining activities subject to the fulfillment
ofconditions specified in these Regulations.
(2) There shall be at least a fiYe percent equity
participation of an indigenous Tanzanian company other
than the Corporation to be qualified for grant of a mining
licence.
(3) Despite sub-regulation (2), the Minister may
vary the requirement specihed in that sub-regulation, in
circumstances where an indigenous Tanzanian company
is unable to satisry the requirement of five percent equity
participation.
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Setting up local
office
Submission of
local content plans
for approval
(4) For the purpose of sub regulation (2), the
Minister shall determine the persons qualified.
(5) The interest of an indigenous Tanzanian
company arising from a mining license is not transferable
to a non-indigenous Tanzanian company.
(6) A non-indigenous Tanzanian company which
intends to pro-vide goods or services to a contractor, a
subcontractor, licensee, the Corporation or other allied
entity within Tanzzrria shall incorporate a joint venture
company with an indigenous Tanzanian company and
afford that indigenous Tanzanian company an equity
participation of at least twenty percentum.
(7) A contractor, subcontractor, licensee or other
allied entity shall before the commencement of mining
activities submit a plan to the Commission specifying-
(a) the role and responsibilities of the indigenous
Tanzanian company;
(b) the equity participation of the indigenous Tanzanian
company; and
(c) the strategy for the transfer of technology and
know-how to the indigenous Tanzanian company.
PART III
LOCAL CONTENT PLAN
9.As far as practicable, before carrying out any
work or activity in the mining industry a contractor,
subcontractor, licensee or other allied entity shall set up
a project office within the district where the project is
located.
10.-(1) A contractor, subcontractor, licensee or
other allied entity shall when making application to
undertake mining activity prepare and submit a local
content plan for approval by the Commission.
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Mining (Local Content)
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Revieu oflocal
content plan
(2) For purposes of sub-regulation (1) a
conffactor, subcontractor, licensee, or other allied entity
shall submit to the Commission-
(a) a long term local content plan which
corresponds with the work programme that
accompanies the application; and
(b) an annual local content plan in respect of each
year.
(3) The Commission shall, within seven working
days of the receipt of a local content plan, acknowledge
receipt and submit the local content plan to the
Committee.
11.-(l) The Committee shall within twenty-five
working days of the receipt of the local content plan
submitted under regulation 7(3), review and assess the
plan and inform the Commission in wilting of the
recommendations of the Committee.
(2) The Committee shall, if satisfied that the plan
complies with the requirements of these Regulations,
recommend the local content plan to the Commission for
approval.
(3) Where the Committee is dissatisfied with the
local content plan, it shall recommend that the
Commission reject the plan and it shall state the reasons
for the recommendation.
( ) The Committee may for the purpose of
reviewing or assessing the local content plan-
(a) provide as far as practicable to persons
involved in the mining industry or likely
to be affected by the decision a
reasonable opportunity of being heard;
and
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Mining (Local Content)
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(b) take into account any representation
made before submitting its
recommendalion to the Commission.
(5) The Commission shall approve the local
content plan if it is satisfied that the local content plan
complies \.vith the provisions of these Regulations and
shall communicate its decision to the applicant within
seven working days of the approval of the
recommendations of the Committee.
(6) Where, based on the recommendations made
by the Committee, the Commission determines not to
approve the local content plan in whole or in part, the
Commission, shall within seven working days of making
the determination, notify the applicant and fumish the
applicant a written statement of the reasons for rejection
by the Commission to approve the local content plan.
(7) Where the Commission rejects to approve the
local content plan submitted by the applicant, the
applicant shall
(a) revise the local content plan taking
account the recommendations of
Commission; and
88
into
the
(b) within fourteen working days, submit the
revised local content Plan to the
Commission.
(8) Where the Commission fails to notiff the
applicant of its approval or otherwise ofthe revised local
content plan, the revised local content plan shall be
deemed io have been approved upon expiry of fifty
working days of the submission.
Mining (Local Content)
GN. No. 3 (contd)
Content oftie local
content plan
Cap.366
Minimum local
content levcls
12.-(1) The local content plan submitted to the
Commission by a contractor, subcontractor, licensee or
other allied entity shall contain detailed provisions-
(a) to ensure that-
(i) first consideration is given to services
provided within the country and goods
manufactured in the country where the
goods meet the specifications of the
mining industry as established by the
Standards Authority or by other
intemationally acceptable standards;
(ii) qualified Tanzanians are given first
consideration for employment; and
(iii)adequate provision is made for the
trainhg of Tanzanians on the job;
(b) on how the contractor, subcontactor,
licensee or other allied entity intends to
guarantee the use of locally manufachued
goods where the goods meet the
specifications of
the mining industry.
(2) A collective bargaining agreement entered
into by a contractor, subcontractor, licensee or other
allied entity in respect of the terms and conditions of
employment of an association of employees shall be in
accordance with the Employment and Labour Relations
Act.
(3) Without limiting sub-regulations (l) and (2), a
local content plan shall have the following sub-plans:
(a) an Employment and Training Sub-Plan;
(b) a Research and Development Sub-Plan;
(c) a Technology Transfer Sub-Plan;
(d) a Legal Services Sub-Plan; and
(e) a Financial Services Sub-Plan.
13.-( I ) The minimum local content for any
mining activity in Tanzania shall be of the levels
specified in the First Schedule.
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Preference to
indigenous
Tanzanian
companies
(2) A contractor, subcontractor, licensee, the
Corporation or other allied entity shall achieve the
minimum local content levels specified in the First
Schedule.
(3) Without limiting sub-regulation (2), the
Commission shall take into account the work programme
of a contractor, subcontractor, licensee, the Corporation
and other allied entity specified in the respective mining
licence in determining the minimum local content levels
to be achieved;
(4) Notwithstanding sub-regulation (2) the
Minister in consultation with the Commission, may
prescribe any additional the minimum local content level
specified in the First Schedule.
l4.A contmctor, subcontractor, licensee or other
allied entity shall establish and implement a bidding
process for the acquisition of goods and services to give
preference to indigenous Tanzanian companies.
15.-(t) A contractor, subcontractor, licensee or
other allied entity shall not award a contract based solely
on the principle ofthe lowest bidder.
(2) Where an indigenous Tanzanian company has
the capacity to execute a job, that indigenous Tanzanian
company shall not be disqualified exclusively on the
basis that it is not the lowest financial bidder.
(3) Where the total value of the bid by a qualified
indigenous Tanzanian company does not exceed the
lowest bid by more than ten percent, the contract shall be
awarded to that indigenous Tanzanian company.
(4) Where during an evaluation of bids, the bids
are adjudged to be equal, the bid containing the highest
level of local content shall be selected.
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Basis of bid
evaluation
Mining (Local Content)
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Submission of
proposed contracts
(5) Where a non-indigenous Tanzanian company
is required to provide goods and services to a contractor,
subcontractor, licensee, or other allied entity, that non
indigenous Tanzanian company shall-
(a) incorporate a company in Tanzania and
operate it from Tanzania; and
(b) provide the goods and services in association
with an indigenous Tanzanian comPany,
where praclicable.
(6) The Commission shall establish bid
evaluation guidelines in accordance with applicable laws
and regulations for ensuring that the year on year
progression of the local content objectives of these
Regulations are met.
16.-(l) A contractor, subcontractor, licensee or
other allied entity shall inform the Commission in writing
of each proposed contract or purchase order-
(a) related to mining activities which is to be
sole sourced; or
(b) where it is to be sourced by a competitive
bidding procedure that is estimated to be in
excess of the shilling equivalent of one
hundred thousand United States Dollars.
(2) A contractor, subconEactor, licensee or other
allied entity shall submit the following documents for the
approval of the Commission:
(a) advertisements relating to expression of
interest;
(b) requests for proposals;
(c) prequalification criteria;
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Mining (Local Content)
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Submission of
quanerly forecasts
(d) technical bid documents;
(e) technical evaluation criteria; and
(f) any other information requested by the
Commission to enable the Commission
determine that the local content
requirements have been complied with.
(3) The Commission shall, within ten working
days of receipt of the documents, communicate its
decision to the contractor, subcontractor, licensee or
other allied entity.
(4) Where the Commission without good cause
fails to communicate its decision to the contractor,
subcontractor, licensee or other allied entity within the
period specified in sub-regulation (3), the documents
shall be deemed approved.
17.-(l) Without limiting the requirements of
regulations 13, a contractor, subcontractor, licensee or
other allied entity shall not later than the first day ofeach
quarter submit to the Commission a list of-
(a) contract of purchase orders to be sole
sourced; and
(b) contracts or purchase orders estimated to
exceed the equivalent of one hundred
thousand United States Dollars and
intended to be tendered for or executed in
the next quarter.
(2) A contractor, subcontractor, licensee or other
allied entity shall provide information specified in the
Second Schedule in respect of each contract or purchase
order.
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Mining (Local Content)
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Documents
rcquired for
bidding process
Review ofcontract
18.-(1) A contractor, subcontractor, licensee or
other allied entity shall provide the Commission with the
following information at the various stages of the bidding
process-
(a) before issuing a prequalification
notification to prospective bidders, the
information specified in Part A of the
Third Schedule;
(b) before issuing a Request for Proposals
or a Request for Quotations, the
information specified in Part B of the
Third Schedule; and
(c) before awarding of a contract or
puchase order to the selected bidder,
the information specified in Part C of
the Third Schedule.
(2) The Commission shall confirm that each
document submined is satisfactory or otherwise provide
written comments on the document submitted during the
bidding process within fourteen working days of the
receipt of the document.
(3) Where the Commission, without good cause
fails to
acknowledge receipt of the documents submitted by the
contractor, subcontractor, licensee or other allied entity
within the period specified in sub-regulation (2), the
submission shall be deemed as approved.
19.-(1) The Commission shall, where it considers
necessary, review some contracts.
(2) The Commission shall, within seven working
days of the commencement of a quarter of the year,
advise the contractor, subcontractor, licensee or allied
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Mining (Local Content)
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Employment and
Training Sub-Plan
entity of which contracts have been chosen for review by
the Commission.
(3) The Commission shall inform the confiactor,
subconfactor, licensee or other allied entity of the
outcome of the review or assessment before the first
day of the relevant quarter.
PART IV
EMPLOYMENT AND TRAINING SUB.PLAN AND
SUCCESSION PLAN
20.-(l) The Employment and Training Sub-Plan
submitted by a contactor, subcontractor, licensee or
other allied entity to the Commission with respect to a
mining activity shall include-
(a) a forecast of the hiring and training needs of
the contractor, subcontractor, Iicensee, or
other allied entity which includes-
(i) a specification ofthe skills needed;
(ii) the anticipated skill shortages in the
Tanzanian workforce;
(iii) the specific training requirements; and
(iv)the anticipated expenditure that will be
incurred bY the contractor,
subcontractor, licensee or other allied
entity in implementing the Emplolment
and Training Sub-Plan as forecasted;
(b) a time frame within which the contractor,
subconEactor, licensee or other allied entity
will provide emplolment opportunities for
the Tanzanian workforce for each phase of
the Mining activity to enable members of the
Tat:zanian workforce prepare for such
opportunities; and
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Mining (Local Content)
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Succession plan
(c) efforts made and procedures adopted for the
accelerated training of Tarzanians.
(2) The contractor, subcontractor, licensee or
other allied entity shall provide to the Commission a
quarterly report on-
(a) employment and training activities for the
reporting period; and
(b) a comparative analysis of the Employment
and Training Sub-Plan and the employment
and training activities 10 monitor
compliance.
21.-(l) The quarterly report shall state the number
of new Tanzanian employees employed during the
respective quarter and their job descriptions.
(2) The Commission may request any further
information the
Commission considers necessary for the purpose of the
implementation of these Regulations.
(3) Where Tanzanians are not employed because
of lack of expertise, the confactor, subconhactor,
licensee or other allied entity shall ensure, to the
satisfaction of the Commission that every reasonable
effort is made to provide training to Tanzanians in that
field locally or outside Tarzania.
21.-(l) A contractor, subcontractor, licensee or
other allied entity shall, as part of the Employment and
Training Sub-Plan, submit to the Commission a
succession plan for any employment position that is
occupied by a non- Tanzanian to ensure that the
minimum local content levels specified in the First
Schedule are met.
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Middle and junior
leYel positions
Prograrnme for
research,
development and
budget
Research and
Developmcnt Sub-
Plan
(2) The succession plan shall make provision for
and require Tanzanians to understudy the requirements
of the position held by a non-Tanzanian for a period
determined by the Commission on a case-by-case basis
after which the position occupied by the non-Tanzanian
shall be assumed by the Tanzania citizen.
22.-(l) A contractor, subcontractor, licensee, or
other allied entity engaged in mining activities shall
employ only Tanzanians in junior level or middle level
positions.
(2) For the purpose of this regulation, "junior or
middle level positions" includes the position of foreman,
supervisor or any coresponding position designated as
such.
PART V
PROGRAMME FOR RESEARCH AND RESEARCH
DEVELOPMENT SUB.PLAN
23.A contractor, subcontractor, licensee or other
allied entity shall, after $ant of mining licence and
before the iom-.nc..e.rt of Mining activities, submit a
programme for research, development and budget to
'Coimission for the promotion of education, practi.cthael
attachments, training and research and development in
the country in relation to its overall work programme and
activities.
24.-(1) A Research and Development Sub-Plan
submitted by a contractor, subcontractor' licensee or
other allied entity to the Commission with respect to a
mining activity shall-
(a) outline a revolving three to five
-
year
programme for Mining related research and
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Mining (Local Content)
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development initiatives to be undertaken in
the country;
(b) provide details of the expected expenditure
that will be made in implementing the
Research and Development Sub-Plan;
(c) provide for public calls for proposals for
research and development initiatives
associated with the activities of the
contractor, subcontractor, licensee or other
allied entity and criteria for selecting
proposals which qualify for support.
(2) The contractor, subcontractor, licensee or
other allied entity shall-
(a) update its Research and Development
Sub-Plan annuallY; and
(b) submitthe updated Research and
Development Sub-Plan to the
Commission for review and approval.
PART VI
TECHNOLOGY TRANSFER PROGRAMMES AND REPORTS
25.The Commission shall, in consultation with
the Planning Commission, relevant Ministries,
Government Departments and agencies identified by the
Commission-
(a) develoP the national PolicY on
technology transfer with respect to the
mining industrY; and
(b) publish the national policyin the Gazette
and a newsPaPer of wider national
circulation.
National plan on
rechnology transfer
Technolory
transfer programme
26.,{ contractor, subcontractor, Iicensee, or other
allied entity shall support and carry out a programme in
accordance with the national plan on technology fansfer
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Technology
transfer Sub-Plan
Suppoft for
technology transfer
Technology
hansfer report
and priorities for the promotion of technology hansfer to
Tanzania i-n relation to the mining industry.
27.A Technology Transfer Sub-Plan submitted by
a contractor, sub-contractor, licensee or otler allied entity
shall include a programme of planned initiatives aimed at
promoting the effective transfer of technolggies from the
contractor, subcontractor, licensee or other allied entity to
aTanzanian indigenous company or citizen.
28.-(1) A contractor, subcontractor, licensee or
other allied entity shall support and facilitate technology
transfer as regards the formation of joint ventues,
partnering of licensing agreements between indigenous
Tanzanian companies or citizens and foreign contractors
and service companies or supply companies.
(2) The Minister shall consult with relevant
Govemment agencies to propose fiscal incentives to
assist:
(a) foreign comPanies which aim to
develop technological capacity and
skills of citizens; and
(b) indigenous Tanzanian companies which
establish factories and production units
in the corntrY.
(3) For purposes of sub-regulation (2), the
Govemment agencies consulted shall collaborate with the
Commission.
(4) The Commission shall propose criteria for
obtaining fi scal incentives.
29.A contractor, subcontractor, licensee or other
allied entity shall submit a technology transfer report
annually to the Commission stating the technology
transfer initiatives being pursued and the current results
in relation to the Technology Transfer Sub-Plan.
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Mining (Local Content)
cap.
GN. No.3 (contd)
lnsurarce and
relnsurance
Approval of
offshorc insurmce
Legal services
Legal Services
Sub-Plar
PART VII
LOCAL INSURANCE SERVICES CONTENT
30.-(1) A contractor, subcontractor, licensee or
other allied entity engaged in a mining activity in the
country shall comply with the provisions of the
Insurance Act,.
(2) The insurable risks relating to mining activity
in the country shall be insured through an indigenous
brokerage firm or where applicable on indigenous a
reinsuance broker.
31.-(l) A person who seeks to obtain offshore an
insurance service relating to a Mining activity in the
country shall obtain written approval of the Commission
of lnsurance.
(2) In granting an approval for procuring
insurance services offshore, the National Insurance
Commission shall ensure that Tanzanian local capacity
has been fully exhausted.
PART VIII
LEGAL SERVICES CONTENT
32.A contractor, subconfiactor, licensee or an
allied entity engaged in a mining activity that requires
legal services in the country shall retain only the services
of a Tanzanian legal practitioner or a firm of Tanzanian
legal practitioners whose principal offrce is located in
Tanzania.
33.The Legal Services Sub-Plan submitted to the
Commission shall include-
(a) a comprehensive report on legal services
utilized in the preceding six months by
expenditure;
99
Mining (Local Content)
GN. No. 3 kontd)
Financial services
(b) forecast oflegal services required during the
ensuing six months where applicable, and
the projected expenditure for the services;
and
(c) annual legal services budget for the ensuing
year quoted in Tanzania Shilling and United
States Dollars.
PART IX
FINANCIAL SERVICES CONTENT
34.-(1) A contractor, subcontractor, licensee or
other allied entity that requires financial services with
respect to a mining activity shall retain only the services
ofa Tanzanian financial institution or organization.
(2) Despite sub-regulation (1), a contractor,
subcontractor, licensee or an allied entity may with the
approval of the Commission engage the services of a
lorei gn fi nancial institution or organization.
35. A contractor, subcontractor, licensee or an
allied entity who has submitted a Financial Services Sub-
Plan to the Commission shall speciff the following:
(a) the financial services utilized in the
preceding six months by expenditure;
(b) a forecast of financial services required in
the ensuing six months and the projected
expenditure for the financial services; and
(c) a list of financial services utilized in the
preceding six months, the natue of
financial services provided and the
expenditure for the financial services made
by the contractor, subcontractor, licensee or
other allied entity.
100
Financial Services
Sub-Plan
Mining (Local Contenl)
GN. No. 3 (contd)
Operation ofbank
account in
Tanzania
Requirement for
submitting local
content
perfomance report
Assessment of
p€rformance report
36.-(l) A contractor, subcontractor, licensee or
other allied entity shall maintain a bank account with an
indigenous Tanzanian bank and transact business
through banks in the country.
(2) For the purpose of this regulation, "an
indigenous Tanzanian bank" means a bank that has one
hundred percent Tanzanian or a majority
Tanzanianshareholding.
PART X
LOCAL CONTENT PERI'ORMANCE REPORTING
37.-(1) A contractor, subcontractor, licensee or
other allied entity shall within forty-five days of the
beginning of each year after commencement of mining
activities submit to the Commission an annual Local
Content Performance Report covering all its projects and
activilies for the year under review.
(2) The report shall be in a format prescribed by
the Commission and shall-
(a) speciff by category of expenditue the local
content on both current and cumulative cost
basis; and
(b) Show the employment achievement in terms
of hours worked by Tanzanians and
foreigners as well as their job positions and
remuneration.
38.-(l) The Commission shall, within fifty
working days after receipt of the Local Content
Performance Report, assess and review the Local
Content Performance Report to ensure compliance with
these Regulations.
(2) For purposes of assessment and verification
of the report, a contractor, subcontractor, licensee or an
allied entity shall allow an employee or a designated
agent of the Commission access to their facilities,
101
Mining (Locol Conlent)
GN. No. 3 (contd)
Requirement for
third palty
reporting
Establishment ofa
Co[unon
Qualification
System
Object ofthe
Common
Qualification
System
documents and infonnation as the Commission may
require.
39.-(1) A contractor, subcontractor, licensee or
other allied entity shall ensure that its partners,
contractors, subcontractors and allied entity are
contractually bound to report local content information
to the contractor, subcontractor, licensee or other allied
entity and, if requested, to the Commission.
(2) A contractor, subcontractor, licensee or other
allied entity shall allow an agent or official designated by
the Commission access to the records of the contractor,
subcontractor, licensee or an allied entity for purposes of
assessment and verification of the local content
information reported to the contractor, subcontractor,
licensee or other allied entity or the Commission.
PART XI
DATA AND INFORMATION ON LOCAL CONTENT
40.-(1) The Commission shall, in consultation
with stakeholders in the mining industry, establish a
Common Qualification System,
(2) The Commission shall manage the Common
Qualification System in accordance with these
Regulations.
41.(1) The objective of the Common
Qualification System shall serve as the soie system for
the registration and pre-qualification of local content in
the mining industry.
702
Mining (Local Conrent)
GN. No. 3 (contd)
Availability of
information
(2) For the purpose of sub-regulation (1),
Common Qualification System shall be used for-
(a) the verification of contractors' capacities
and capabilities;
(b) the evaluation of application of local
content submitted by a contractor,
subcontractor, licensee or other allied
entity;
(c) the tracking and monitoring of
performance and provision of feedback;
and
(d) ranking and categorization of mining
service companies based on capabilities
and local content.
42.-(1) Any person may during working hours:
(a) access and inspect records that relate to
local content kept by the Commission
and designated as public records; or
(b) request to be fumished with a certified
copy or extract from any document that
that person is entitled to access.
(2) The right of a person to inspect or obtain a
copy of a recordfiled or kept in electronic form by the
Commission shall extend only to the reproductions of the
document in written form in a manner that the
Commission determines.
(3) An application for an extract or a certified
copy of record requested shall be accompanied by a fee
determined by the Commission.
(4) The Commission shall publish on its
website,information relating to these Regulations and
local content and local padcipation requirements
generally.
103
Mining (Local Content)
GN. No. j (conrd)
Public education 43.The Commission shall ensue that public
educationis undertaken to educate contractors,
subcontractors, licensees and other allied entities, the
public and industry stakeholders to educate them about
the local content policy and philosophy and to ensure the
implementation of these Regulations.
Communication of
local content
policies
44.-(l) A contractor, subcontractor, licensee or
other allied entity shall-
(a) communicate local content policies,
procedures and obligations to any person
engaged by that contractor, subcontractor,
licensee or other allied entity to perform an
aspect of a mining activity; and
(b) monitor and ensure compliance with local
content policies, procedures and obligations.
(2) Notwithstanding sub-regulation (1), a
confiactor, subcontractor, licensee or other allied entity
shall make available the local content policies,
procedures and obligations of that contractor,
subcontractor, licensee or other allied entity available on
their respective websites.
PART XII
MONITORING, COMPLIANCE AND ENFORCEMENT
Electronic filing of 45.-(l) The Commission may issue guidelines to
oocumenl5 provide for a system requiring documents under these
Regulations to be filed in electronic form.
cap" (2) The system for filing of documents in
electronic form shall be in accordance with the Electronic
Transactions Act, and shall provide for-
(a) the criteria for authorizing persons to file
documents in electronic form; and
(b) thesecurity and authentication of the
documents filed.
to4
Mining (Local Content)
GN. No. 3 (contd)
Establishment of
guidelines and
procedures
Loca] conlent
monitoring
Investigations
46.-(1) The Commission shall establish and
constantly review guidelines and procedures for the
effective implementation of these Regulations.
(2) Without limiting sub-regulation (1), the
Commission shall, in consultation with relevant
institutions, issue guidelines for compliance by a
contractor, suhontractor, licensee and other allied entiry
in respect ofthe following:
(a) requirements and targets for the growth of
research and development of the Mining
industry of the country;
(b) minimum standards, facilities, personnel and
technology for training in the Mining
industry of the country;
(c) lnvestment in or setting up a facility. factory,
production unit or other operation in the
country to carry out any production or
manufacturing or to provide any Mining
related service specified in Part Two of the
First Schedule otherwise imported into the
country; and
(d) generally for the implementation of these
Regulations.
47.The Commission shall monitor and investigate
the activities of each contractor, subcontractor, licensee
and other allied entity to ensure the achievement of the
purpose of these Regulations within the framework of the
national policy on local content.
a8.-(1) The Commission may, for the purposes of
enforcing these Regulation, initiate an investigation into
an activity of a contractor, subcontractor, licensee or
other allied entity.
105
Mining (Local Content)
Gli. lio 3 (contd)
Offences and
penalties
(2)Without prejudicesub-regulation (1), the
Commission may launch investigations to ensue that-
(a) the Tanzanian company principle is not
diluted by the operation of a front; or
(b) bid rigging and canalization are avoided
in the procurementprocess.
PART XIII
FINAL PROVISIONS
49.-(1) A person who submits a plan, retums,
report or other document and knowingly makes false
statement, commits an offence and is liable on
conviction to a fine of not less than fifty million shillhgs
and not more than five hundred million or to a term of
imprisonment of not less than two years and not more
than five years or to both.
(2) A citizen who acts as a front or connives with
a foreign citizen or company to deceive the Commission
as representing an indigenous Tanzanian company to
achieve the local content requirement under these
Regulations, commits an offence and is liable on
summary conviction to a fine of not less than one
hundred million shillings and not more than two hundred
and fifty million or to a term of imprisonment of not less
than one year and not more thanfive years or to both.
(3) A person who connives with a citizen or an
indigenous Tanzanian company to deceive the
Commission as representing an indigenous Tanzanian
company to achieve the local content requirement under
these Regulations commits an offence and is liable on
summary conviction to a fine of not less than ten hundred
million shillings and not more than ten billion shillings or
to a term of imprisonment of not less than five years and
not more than ten years or to both.
106
Mining (Local Content)
GN. No. 3 (contd)
(4) A person who fails to-
(a) support and carry out a programme in
accordance with the national plan on
technology transfer;
(b) support and facilitate technology transfer as
regards the formation of joint ventures,
partnering of licensing agreementsbetween
indigenous Tanzanian companies or
citizens and foreign contractors and service
companies or supply companies;
(c) ensure that its partners, contractors,
subcontractors and allied entities report
local content information to the
contractor; or
(d) communicate local content policies,
procedures and obligations to any person
engaged by that contractor, subcontractor,
licensee or other allied entity to perform an
aspect of mining activity; and
(e) support and carry out a programme in
accordance with the national plan on
technology hansfer,
is liable to pay to the Commission an administrative
penalty of one hrurdred million shillings in the first
instance and a further penalty of five percent for each
day during which the contravention continues.
(5) A person who fails to comply with a request
to fumish information or a record under these
Regulations within the period specified in the request is
liable to pay to the Commission an administrative
penalty two billion shillings in the fint instance and a
frrther penalty of ten percent of the penalty for each day
during which information or record is unfumished.
LO7
Mining (Local Content)
GN. No. j (contd)
Complaints to
Minister
(6) A contractor, subconfiactor, licensee or other
allied entity that-
(a) carries out mining activities without the
required local content requirement in
contravention of regulation 3;
(b) fails to submit a local content plan in
contravention of Regulation 7;
(c) fails to satisfr the content requirement
of a local content plan in contravention
of Regulation 9; or
(d) faits to inform the Commission of each
proposed contract or purchase order in
contravention of Regulation 13;
shall be liable to pay to the Commission a administrative
penalty of five percent of the value of the proceeds
obtained from the mining activity in respect of which the
breach is committed or five million United States Dollars
whichever amount is greater and further liable for
cancellation of a contract in respect of the mining
activity.
(7) A penalty required to be paid under this
Regulation and which is not paid within the period
specified in the notice shall be a debt owed to the
Republic and recoverable by the Commission under
summary procedure.
50. A person aggrieved by the decision of the
Commission in relation to the implementation of these
Regulations may lodge a complaint with the Minister
who shall, within thirty days of receipt of the complaint,
make a decision.
5l.Within tkee months after coming into force of
these Regulations, a confiactor, subcontractor, licensee,
or other allied entity engaged in a mining activity shall
108
Transitional
provisions
Mining (Local Content)
GN. No 3 ftontd)
make arrangement and plan to the satisfaction of the
Commission as are necessary for complying with these
Regulations.
109
Mining (Local Content)
GN. No. 3 (contd)
A: LOCAL CONTENT LEVELS TO BE AT.TAINED FROM DATE OF EFFECTIVENESS OF
I,ICENCE OR MINING ACREEMENT
FIRST SCIIEDULE
(RegulatiorLt l3(2))
MINIMUM LOCAL CONTENT IN GOODS AND SERVICES
110
Item St8rt 5 y€8rs l0 years
l. l. Goods and serviccs t00/o 500/o 60.90%
I.2. Recrurtment and training
(a) Management staff 300/. 50-60% 70-800/0
(b) Technical core staff
(c)
200/. 50-60% 70-900/"
(d) Other stafi 80% 9tr/o 100%
Mining (Local Content)
GN No.3 (contd)
B: SPECIFIC LEVELS TO BE ACHIEVED
(a) Research and Development relating to tn-Country Seru I ces
111
Description Start 5verrs l0 yesrs Measurement Unit
l. l. Engineering studies-rcsenoir,
facilities, drilling etc.
20% 400/. 60% Spcnd
1.2. Geological and geophysical
servrces
200/. 30% 800/. Spcnd
1.3. Safetv and environmental sludies 40% 70% 900/" Spend
L4. Local materials substitution
studies
20% 40vo 15% Spcnd
1.5. Freight forwarding, logistic
management services
80% 90o/o. 100% Spcnd
1.6. Supply base, warehouse, Siorage
servtces
50% 80o/o 900/. Spend
I.7. Truck package product,
Trarsportation services
80% 900/" t00%. Spend
Mining (Local Content)
GN. No. 3 (cond)
ft) Heahh, Salety and Environnent Semices
trz
Description Start Syears l0 yesrs Measurement Unit
(a) Site clearup services 30o/o 60% 900/. Man Hour
(b) Pollution control 200/" 300/. 45% Spend
(c) Waste water treatment
a.nd disposals sertices 400/. 600/o 800/0 Ma.n Hour
(d) Industrialcleaning
servlc€s
500/. 80o/o 900/. Man Hour
(e) Safety, protcction
security firefighting
system services
30% 50% 90o/o Spend
(f) Preservation of
mechanical ard electrical
components 5€rvices
300/o 500/" 90Yo Man Hour
(g) Equipmentbrokerage
serylces
50% 70% 90% Spend
(h) Temporary
accommodation, carnp
s€rvices
50% 600/. 80% Spend
(i) CatEring Services 100% t00o/o too% Spcnd
0) Cleaning and laundry
seryrces
toovo 100% r00% Spend
(k) Security services 100% t0tr/o t00vo Spend
(l) Medical sewices 40vo 600/o 900/. Spend
(m) Other supporting scrvices 50% 800/0 90% Spend
Mining (Local Content)
GN. No. 3 (contd)
(c) Inlotmation Systems, Inforrfiatioh Technologr' and Communicotion Seflices
113
Description Strrt 5years l0yerrs Mcqsured Unit
(a) Network installation,
suppon servic€s
80% 90% 950/. Spend
(b) SoRwarc
development
400/o 60% 80% Sp€nd
(c) Software
services
support 60% 80% 900/. Spcnd
(d) Computer based
modcling services
20o/o 50% 70% Spend
(e) Computer ba-sed
simulalions and
training progranmc
services
200/. 500/. 70% Spcnd
(f) Hardware
installation support
services
80 o/o 90o/o 100% Spend
(g) Operaling system
installation a.nd
support s€rvices
800/. 900/. t00% Spend
(h) User support and
help desk services
20o/o 500/" 80v, Spend
(i) Information
Technolosi
Management
consultancy services
100/. 50o/o 800/0 Spend
(j) Data Marugement
servlces
30% 500/. 80% Spcnd
(k) Telecommunication
inslallation and
Othq Information
Technology services
50o/o 70% 90% Spend
(l) support serviccs 30% 500/0 80o/o Spend
Mining (Local Content)
GN. No. 3 (contd)
SECOND SCHEDULE
Regulatrcn 17(2)
INFORMATION TO BE PROVIDED TO COMMISSIONER WITH QUARTERLY
FORECASTS
A contractor, subcontractor, licens€c or other allied entity shall provide the information spccified
below in respecl ofeach contract, subcontract and purchase order:
(a) A description ofthc scrvice or items to be contracted or purchased including lhc material and
equipment spccifi cation if requested.
(b) The cstimated valuc ofthe contract, subcontract or purchase order.
(c) The anticipated dates for the following:
(i) the issuanc€ and closur€ ofthe Request For Proposals; ard
(ii) Contract award.
(d) Any other information requested by the Commissioncr for the implemcntation ofthcse
Regulations.
7t4
Mining (Local Content)
GN. No. 3 (contd)
TIIIRD SCHEDULE
Regularion l8(U
PART-A
INFORMATION TO BE PROVIDED BY A CONTRACTOR, SUBCONTRACTOR,
LICENSEE OR OTIIER ALLIED ENTITY TO COMMISSIONER PRIOR TO ISSUE OF
PREQUALIFICATION OF PROSPECTIVE BIDDERS
A licensee or contractor shall provide the information specified bclorv prior to issuing a
prequalifi cation notice to bidders:
(a) A description ofthe scope ofwork.
(b) A copy of the prequalification notification, where thc related documents differ from the
standard prequalification notice previously revicwed and approved by the Commissioner.
(c) The list of companies indicating locations ofhead omces and conlact p€rsons and numbers to
which questions willbe directed.
(d) The anticipated datcs for closure of prequalification and issuancc ofRequest for Proposals or a
Requcst for Quotations.
PART-B
(Regulation 15 (I) (b))
INFORMATION TO BE PROVIDED BY A LICENSEE OR CONTRACTOR TO LOCAL
CONTENT COMMITTEE PRIOR TO ISSUE OT REQUEST FOR PROPOSALS OR
REQUEST FOR QUALIFICATION
For the purposcs of compiling a bidding list for any project, the operalor o. contBctor shall provide
the information specified below prior to issuing a Requcst for Proposals or Request for
Qualification:
(a) A list of bidders;
(b) A copy ofthe Requast for Proposals or Request for Qualificalion in respect ofwhich the
Commissioner will advise the licensce or confactor ofits requirements on a case by case
basis;
(c) A dcscription of the corporate ownenhip ofthe bidders, including the main sharcholders
by pcrcenlage;
(d) The locatior ofany Tanzania based office, plant or facilily;
(e) The anticipated dates for closure ofbids aIId award ofcontract or purchase orders; and
(D Any other informalion which tie Conunissioner shall requcst.
115
Mining (Local Content)
INFORMATION TO BE PROVIDED BY A LICENSEE OR CONTRACTOR TO THE
COMMISSIONf,R PRIOR TO THE AWARD OF CONTRACT OR PURCIIASE ORDER
TO THE SELECTED BIDDER.
GN. No. 3 (contd)
PART-C
(Regulotion l5 (l)(e))
Prior to the award ofcontract or purchase order to the s€lect€d bidder, the licensee or cortractor
shall provide the information specified below:
L The name ofthe selected contractor or vendor;
2. A list ofdesignated sub-contractoN or sub-vendors;
3. Where applicable, a list ofproposed sub-suppliers;
4. ln respect ofconstruction or servica contracts, the estimated Tanzanian employment Ievel
in person-hours;
5. The commencement and completion dates for the contract or purchase order;
6. The Award Notification Form signed by the appropriatc official ofthe opelator or
contractor;
7. A statement ofaward rationale or bid evaluation report showing the following:
(a) the narne ofthe selccted contractor or vendor;
(b) the list ofdesignated sub-contractors or sub-vendon;
(c) where applicable, a list ofproposed sub-suppliers;
(d) in respect of construction or service contracts, ths estimated Tanzanian employment
level in person hours;
(e) the commencement and completion dates for the cofltract or purchase order;
(0 the Award Notification Form signed by an appropriate official ofthe operator;
(g) a statement of award rationale or bid evaluation report showing;
(i) the percentage differenc€ in price between selected bidder and the other
bids;
(ii) the primary location ofwork associated with each bidder;
(iii) the estimates oflocal content associated with the bid ofeach bidder
calculated in accordance with the definition ofthe local content to be
provided by lhe Commissioner;
(iv) Any other information relevant to the evaluation ofbids including where
applicable, a summary ofthe technical, commercial and Iocal content
aspects of the bid evaluation.
Dar es Salaam
9s January, 2018
ANGELLAHJ.M. KAIRUKI
Mtnister for Mtnerals
116

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