Laos Government Imposes Higher Fines to Curb Unlawful Mining Practices

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Laos Government Imposes Higher Fines to Curb Unlawful Mining Practices
[FILE] this image is used only for representational purpose (photo: thinkchina.sg)

In a move to penalize mining companies that carry out unlawful practices, the government has issued fines of over a billion kip to ensure legitimate mining activities among mining operations.

Prime Minister Sonexay Siphandone made the initiative official by signing a decree outlining fines for unlawful activities related to surveys, excavation, trade, processing, transport, concealment, and damage to minerals.

Starting April 1, the new order imposes the highest fine of LAK 2 billion (approximately USD 96,816.20) on companies violating legislation regarding mineral excavation and processing.

The second-largest fine, LAK 1 billion (USD 48,408.10), applies to companies misusing their business license, utilizing it beyond its intended scope, or implementing it as a loan guarantee. Businesses are also prohibited from engaging in activities like excavating, trading, removing, or transporting reserved and prohibited minerals. 

This came after the government had observed a number of illegal activities and their impacts on the mining industry. It is also an attempt to maximize the benefits of mining for Laos and make the most effective use of the country’s mineral resources.

In November, Prime Minister Sonexay pledged to enhance technical standards and increase weighing stations across the country through strict regulations on heavy vehicles, particularly those involved in mining operations. 

This strategic move aims to address issues raised by Khamphanh Phommathat, the President of the State Inspection Authority (SIA). He highlighted the significant damage caused by heavily laden trucks carrying minerals to roads. Improper management of mining operations has also resulted in encroachment into forested areas, including reserved and protected forests, as well as farmland.

Khamphanh further disclosed that differences in the recorded weights of minerals at mining sites and end-border checkpoints raised suspicions. It was suggested that mining companies might be providing false reports to inflate their profits.

Earlier this month, the Ministry of Technology and Communications established a partnership with China Rocket Co., Ltd., a prominent Chinese company. This collaboration aims to jointly utilize satellite tracking technology, enhancing mineral exploration services for both public and private entities.