From the effective date of this Code, the grant by the State of a Mining Operation Title immediately gives the State an ownership interest, at no cost, of up to a maximum of fifteen per cent (15%), in the capital of the company holding the Title.
This provision does not automatically apply to Mining Concessions signed and ratified before the effective date of this Code. Its implementation in relation to the said Mining Concessions (signed and ratified) is subject to the conditions provided in Article 217 of this Code.
This interest cannot be diluted by eventual increases in capital. This participation is also free from all charges and this interest is free carry. This interest is obtained upon the signature of the Mining Operation Title.
This interest, which is at no charge to the State, can neither be sold, nor become the subject of a pledge or mortgage. It confers on the State all the rights conferred on to shareholders by the OHADA Uniform Act relating to Commercial Companies and Economic Interest Group.
The State has the right to acquire a supplementary participation, in cash, according to the terms agreed with each relevant mining company within the scope of the Mining Agreement. This acquisition option may be scheduled over time, but may be exercised only once. The total participation held by the State under this Article may not exceed thirty-five per cent (35%).
The table below defines, per mineral substance and with the basic limit of thirty-five per cent (35%), the levels of State participation in the capital of companies holding a Mining Operation Title.
Levels of State participation in companies holding a Mining Operation Title:
| Mineral products and derivatives | Non-dilutive Shareholders’ Rights% | upplementary Cash Interest (%) |
|---|---|---|
| Bauxite | 15 | 20 |
| Bauxite-alumina (integrated project*) | 5 | 30 |
| Alumina | 7.5 | 27.5 |
| Aluminum | 2.5 | 32.5 |
| Iron ore | 15 | 20 |
| Steel | 5 | 30 |
| Gold and diamond | 15 | 20 |
| Radioactive ore | 15 | 20 |
| Other mineral substances | 15 | 20 |
*financing of a bauxite mine and an alumina refinery
At the request of a holder of a Mining Operation Title, the right of the State to acquire an additional interest in cash in the capital of a company holding a Mining Operation Title can be reduced in exchange for an increase of equal value, determined by an independent expert selected by mutual agreement, and according to the Mineral Substance concerned, of the tax rate on the extraction of Mine Substances other than the Precious Metals indicated in Article 161 or of the tax on the industrial or semi-industrial production of Precious Metals indicated in Article 161-I of this Code, for which such company is liable.
The interest of the State that is payable in cash is assignable and may be sub-leased. The State reserves the right to auction, in an open and transparent process, all or part of its interest that is payable in cash, with no right of pre-emption for the other shareholders of the company holding the Mining Operation Title.
The decision relating to the assignment of all or part of the State’s interest that is payable in cash, and the terms thereof, must comply with the provisions of the act relating to withdrawal by the State.
The shareholders of the company holding the Mining Operation Title must sign a shareholders’ agreement that defines, inter alia, decisions which are not to be made without the prior agreement of the State.