TIMOR-LESTE Law and Practice Contributed by: João Afonso Fialho, Tomás Cabral Anunciação and Teófilo de Jesus, VdA
5.2 Foreign Investment Restrictions and Approvals in the Exploration and Mining Sectors There are no specific restrictions imposed on foreign investment related to exploration and mining activities, except for strategic minerals. In the case of strategic minerals, if public interest reasons justify it, the government may determine that their marketing must be carried out directly by the national mining company, or through an association with national or foreign companies. There are also no special rules in respect of for - eign ownership, except for artisanal mining and the exploration and mining of construction mate - rials, where access to mineral rights is restricted by local content provisions. 5.3 International Treaties Related to Exploration and Mining Timor-Leste is not a party to international trea - ties that favour or protect investment in explora - tion and mining. 5.4 Sources of Finance for Exploration, Development and Mining The main sources of funding for private parties intending to carry out mining activities in Timor- Leste are privately owned capital and interna - tional funding instruments. 5.5 Role of Domestic and International Securities Markets in the Financing of Exploration, Development and Mining Timor-Leste does not have a stock exchange market. Most of the funds invested in the min - ing sector come from overseas. 5.6 Security over Mining Tenements and Related Assets The creation of security interests over mining rights is subject to the prior approval of the
National Authority of Mineral Resources, except when securities are created for the financing of mining activities and the beneficiary entity agrees that any judicial sale related to the enforcement of the security interest is subject to consent by the Ministry of Petroleum and Mineral Resourc - es. To achieve this, the holders of the mining rights must send a written notice to the National Authority of Mineral Resources of their intention to create an encumbrance over a mineral right. This notice must include: • all identity details in respect of the beneficiary of the encumbrance; and • information regarding the underlying transac - tion by which the mining rights or assets are encumbered. The Mining Code foresees that the creation, modification or expiration of charges or encum - brances over mining rights is subject to regis - tration under the Mining Registry (still pending creation), to be organised and managed by the National Authority of Mineral Resources. 6. Mining: Outlook and Trends 6.1 Two-Year Forecast for the Mining Sector The government of Timor-Leste is keen to attract investment in the country’s mining industry, after the launch in 2023 of the first public tender for the award of mineral rights since the enactment of the Timor-Leste Mining Code in 2021. In total, 49 areas were opened for tender and, according to the Overview of Timor-Leste’s Geology and Mineral Potentials Report enclosed with the public tender, Timor-Leste has various metallic minerals such as gold, copper, zinc, manganese
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