ZAMBIA Law and Practice Contributed by: Harriet Mdala, Natasha Lungu, Samuel Muleya and Chanda Musonda-Chiluba, MAY and Company
By virtue of Teal Mineral’s shareholding in Kon - noco, which in turn held shares in Lubambe Zambia, Teal Minerals held an interest in Lubam - be Zambia’s mining right. Therefore, Teal Miner - als transferred its interest in the mining right held by Lubambe Zambia to EMR. The transaction was therefore subject to PTT. Indirect acquisi - tions of mining rights using offshore companies will therefore also require approval of the Min - ister of Mines and payment of PTT in Zambia. 5. Mining Investment and Finance 5.1 Attracting Investment for Mining Key Features of Attracting Investment in Zambia’s Mining Sector Regulatory and legal framework Zambia’s mining industry is governed by the Mines Act, which provides a robust legal frame - work ensuring security of tenure, transparent licensing procedures, and protection of inves - tors’ rights. Efforts to streamline bureaucratic processes enhance the ease of doing business, making the sector more accessible to both local and foreign investors. Rich geological potential Zambia is endowed with extensive mineral resources, with copper as the primary export earner. Other significant reserves include cobalt, gold, emeralds, and other gemstones, alongside industrial minerals. Comprehensive geological data and surveys, accessible through govern - ment and private institutions, reduce exploration risk and attract investment. Political stability Zambia enjoys a reputation for political stability, peaceful transitions of power, and adherence to the rule of law. Investor protection is further bol -
stered by robust dispute resolution mechanisms, including arbitration. Access to regional and international markets Zambia’s membership in the Southern Afri - can Development Community (SADC) and the Common Market for Eastern and Southern Africa (COMESA) provides access to significant regional markets. Furthermore, favourable trade agreements facilitate the export of minerals to international markets, enhancing the profitability of mining projects. Foreign exchange controls No foreign exchange controls and dividends may be repatriated without the need for oner - ous regulatory consents. Local content requirements There are no local content requirements for holders of large-scale mining and exploration licences. 5.2 Foreign Investment Restrictions and Approvals in the Exploration and Mining Sectors Zambia generally imposes minimal restric - tions on foreign investment in mining. However, specific limitations exist under the Mines Act, particularly regarding certain mining rights and operations. Size-Based Restrictions on Mining Rights Mining rights over areas between two cadas - tre units (6.68 hectares) and 120 cadastre units (400.8 hectares) are reserved for: • citizen-influenced companies: 5% to 25% equity owned by Zambian citizens; • citizen-empowered companies: 25% to 50% equity owned by Zambian citizens; and
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