ECUADOR Law and Practice Contributed by: Roque Bernardo Bustamante and Claudia Bustamante, Flor Bustamante Pizarro & Hurtado
ARCOM Article 8 of the Mining Law establishes the creation of the Mining Regulation and Control Agency (ARCOM) as the technical-administrative body in charge of exer - cising the State power of surveillance, auditing, inter - vention and control of the phases of mining activity carried out by ENAMI, and in mixed-mining compa - nies, private initiative, small-scale mining and artisanal and livelihood mining, in accordance with the regula - tions of this law and its regulations. ARCOM has the competence to supervise and adopt administrative actions that contribute to the rational and technical exploitation of the mining resource, and to the claiming of the fair share of the benefits by the State as a result of its exploitation, as well as to the fulfilment of social and environmental responsibility obligations assumed by the holders of mining rights. ARCOM has the following powers and responsibilities, among others: • to keep a register and cadastre of mining conces - sions and publish it by electronic means; • to inspect the mining activities carried out by the holders of mining rights and titles; and • to grant licences for the commercialisation of min - eral substances determined in the present law. ARCOM also regulates the assignment and transfer of mining rights as well as other industry issues, as it is the regulating entity. 1.5 Nature of Mineral Rights All minerals and products thereof found underground belong to the State of Ecuador, as per the provisions of the Ecuadorian Constitution. The law allows the State of Ecuador to grant a mining concession through the issuance by the central government of a mining concession title, which, subject to the provisions of the law, including environmental laws and regulations, enables the mining concession holder to explore and produce minerals. Mineral rights granted through con - cessions do not have the status of property, but of rights to explore and produce. Once the minerals are produced, they become the property of the conces - sion holder, who can sell them freely on the market.
Any natural or legal person, national or foreign, has the power to prospect freely for the purpose of seeking minerals, except in protected areas, within the limits of mining concessions, in urban or populated areas, in archaeological areas, in areas declared to be of public utility and in Special Mining Areas. The President of the Republic of Ecuador may declare Special Mining Areas, subject to Article 407 of the Constitution, in those areas in which there is potential for mining development and which are not conces - sioned, with the purpose that the Ministry of Energy and Mines, through its attached entities, carry out cadastres, geological-mining investigations or oth - er types of activity of scientific interest, within their respective competencies. The declaration of a Special Mining Area shall express - ly establish the term of validity of the Special Mining Area, which may not exceed four years; once this term has expired, it shall be lifted without the need for any provision that so declares. In all cases, the declara - tion will respect the legally established rights or those derived from them. Natural or juridical persons, national or foreign, who are holders of mining rights or who carry out mining activities, are subject to the laws, courts and judges Mining concessions are divided into large-scale con - cessions, medium-sized mining and small-scale min - ing. Small-scale mining refers to operations that, due to the characteristics and geological conditions of the deposits of metallic and non-metallic mineral sub - stances and construction materials, as well as their technical and economic parameters, can be exploited efficiently in a direct manner, without prejudice to the fact that exploration work precedes it, or that explo - ration and exploitation work is carried out simultane - ously. Medium-sized mining refers to operations that, due to the size of the deposits and depending on the type of metallic and non-metallic mineral substances in of the country. Mining Scale
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