Republic Act No.

7076 Peoples Small-Scale Mining Act (1991)

Undeniably the Philippines is endowed with large deposits of minerals like gold silver,
cobalt, copper and the like. With these natural endowments, the exploitation of minerals
contributes largely to the growth of the national economy. But these mining operations have
adverse effects on the ecological balance. The large-scale extraction and usage of mineral
resources are inherently and essentially polluting. They consist of the excavation and
permanent removal of the minerals from their deposited positions, and thereafter their
burning fuel or other utilization. From the stage of exploration to extraction, mining has
consistently inflicted some degree of damage to the environment either through the pollution
of rivers and seabeds, the acidification of agricultural plains or the unwanted pollution it
creates. These negative environmental effects are the externalities which arise out of the
profit-oriented decisions of mining firms. It is through the use of the regulatory powers of the
State that the private sector is compelled to shoulder the costs of these externalities.

It is for these reasons that mining legislation was enacted to oblige environmental
protection measures to be undertaken by mining operators. One of this laws enacted by our
esteemed legislators is Republic Act No. 7076 (1991), Peoples Small-Scale Mining Act.

OVERVIEW OF THE LAW

Republic Act No. 7076 (1991), otherwise known as the Peoples Small-Scale Mining
Act defines small-scale mining as minimum activities which rely heavily on manual labor
using simple implements and methods, and which do not use explosives or heavy mining
equipment. The main purpose of the law is: (1) To effect an orderly and systematic
disposition of small-scale mining areas in the country; (2) To regulate the small-scale mining
industry with the view to encourage their growth and productivity; and (3) To provide
technical, financial and marketing assistance and efficient collection of government
revenues. Through this law, the harmful effects of the classic trade-off between development
and environment could be minimized if not totally avoided. This law was authored by Senator
Aquilino Pimentel Jr.
With Republic Act 7076 it allows small miners under this law to use only simple
equipments like pick and shovel in extracting gold and other precious metals in their mining
areas. In this age of modern technology, this law is making sure that the small mining law
should benefit the small miners and not only the big-time operators who are using the skills
and sweat of small-scale miners to accumulate a fortune.

Under RA 7076, no ancestral land may be declared as a peoples small scale mining
area without the prior consent of the cultural communities concerned. This respects the
rights of the indigenous peoples to their ancestral lands which are fully guaranteed under
existing laws. The law defines small miners as Filipino citizens who, individually or in tandem
with others, voluntarily form a cooperative, duly licensed by the Department of Environment
and Natural Resources, to engage in the extraction or removal of minerals or ore-bearing
materials from the ground.
 HIGHLIGHTS

Its implementing rules lay down the powers and functions of the Department of
Environment and Natural Resources, the Provincial/City Mining Regulatory Board and in
coordination with other concerned government agencies. The DENR together with the other
concerned government agencies is designed to achieve an orderly, systematic and rational
scheme for the small-scale development and utilization of mineral resources in certain mineral
areas in order to address the social, economic, technical, and environmental connected with
small-scale mining activities.

While the Provincial/City Mining Regulatory Board (PCMRB) created under the direct
supervision and control of the Secretary which is the board of PCMRB, is the implementing
agency of the Department of Environment and Natural Resources which has the powers and
function subject to review by the Secretary.

PROHIBITED ACTS

Awarded contracts may canceled on the following grounds:

1. Non-Compliance with the terms and conditions of the contract and that of existing mining
laws, rules and regulations including those pertaining to mine safety, environmental
protection and conservation, tree cutting, mineral processing and pollution control;
2. Non.-compliance with the contractor's obligations to existing mining claim holders/private
landowners as stipulated in Section 13, 17 and 18 of this Order;
3. Non-payment of fees, taxes, royalties or government share in accordance with this Order and
existing mining laws;
4. Abandonment of mining site by the contractor; and
5. Ejectment from the People's Small-scale Mining Area of the Contractor by the government for
reasons of national interest and security.

PENALTIES/FINES
When contracts are canceled for grounds from the abovementioned, the Secretary may
impose fines of an amount not less than Twenty Thousand Pesos (P20, 000.00) but not more
than One Hundred Thousand Pesos (P100, 000.00). Non-payment of the fine imposed shall
render the small-scale mining contractor ineligible for other small-scale mining contracts.
Clarificatory Guidelines In The Implementation
Of
The Small-Scale Mining Laws
I. Co-existence of the Small-Scale Mining Laws
1. PD No. 1899 and RA No. 7076 shall continue to govern small-scale mining operations. For areas not
declared as Peoples Small-Scale Mining area (PSSMA) under RA No. 7076, the pertinent rules and
regulations of PD 1899 shall apply.
2. Mines Administrative Order No. MRD-41, Series of 1984,
Department Administrative Order (DAO) No. 28 and MRDB Administrative Order Nos. 3 and 3A as
provided in DAO No. 96-40, as amended, shall continue to be the implementing rules and regulations of PD
No. 1899, while DAO No. 34, Series of 1992, shall continue to be the implementing rules and regulations of
RA No. 7076.
II. Scope of Small-Scale Mining Permits and Contracts
1. Small-scale mining operations in areas not declared as PSSMA shall be covered by Small-Scale Mining
Permits (SSMPs) issued under PD No. 1899. Small-scale mining operations in PSSMAs declared under RA
No. 7076 shall be covered by Small-Scale Mining Contracts (SSMCs) pursuant to the pertinent provisions
thereof.
2. In case, where a PSSMA is declared covering SSMP areas, the term of the SSMPs, including their renewal,
shall be recognized unless such SSMPs are revoked, cancelled or terminated with the cause: Provided, that
the SSMP shall have the option to shift to a SSMC pursuant to the provisions of DAO No. 34, Series of
1997.
III. Term of a Small-Scale Mining Permit or Contact
1. The two (2)-year term of an SSMP is renewable only once: Provided, that the pertinent application shall be
filed prior to the expiration thereof, among other requirements. No SSMP shall be renewed unless its two
(2)-year term is fully consumed.
2. In the case of an SSMC, no renewal shall likewise be granted unless its two(2)-year term is fully consumed.
IV. Qualification of Applicants
A. For PD No. 1899, any Qualified Person may apply for an SSMP. For this purpose, a Qualified Person shall
mean a Filipino citizen, of legal age, and with capacity to contract, or a corporation of partnership authorized
to engage in mining, registered with the Securities and Exchange Commission, at least 60% of the capital of
which is owned t all times by Filipino citizens.
B. For RA No. 7076, only a Filipino small-scale mining cooperative organized by licensed and registered small-
scale miners may apply.
V. Maximum Annual Production
 1. For metallic minerals, the maximum annual production under an SSMP/SSMC shall be 50,000 dry metric
tons (DMT) of ore, while for non-metallic minerals, the maximum annual production shall be 50,000 DMT of
the material itself, e.g., 50,000 DMT of limestone, 50,000 DMT of silica, or 50,000 DMT of perlite.
2. The maximum annual production above shall include low-grade and/or marginal ore, and/or minerals or
rocks that are intended for sampling and/or metallurgical testing purpose/s.
VI. Maximum Capital Investment
1. The maximum capital investment for a single small-scale mining
operation under PD No. 1899 or R.A. No. 7076 shall be PHP 10 Million. This shall cover raw,
additional and existing capital, such as processing plants, mine and hauling equipment, tools,
infrastructures, capitalized exploration and development costs, support facilities and working capital.
VII. Reliance on Manual Labor
1. Small-scale mining operations under P.D. 1899 or RA No. 7076 shall be largely artisanal with heavy reliance
on manual labor and without the use of explosives and/or blasting accessories. For this purpose, a single
unit small-scale mining operation, in open cast or shallow underground, shall be prohibited from using
sophisticated and/or heavy equipment, i.e., excavators, loaders, backhoes, dozers, drilling machines and/or
related or similar equipment for the extraction and/or breakage of materials, as well as hauling equipment
within the mining/permit/contract area.
VII. Reliance on Manual Labor
1. Hauling equipment for the transport of the ore or mined materials from the mine to the shipping point/market
are not included in the prohibited use of sophisticated and/or heavy equipment.
2. In case non-sophisticated and non-heavy equipment shall be use, the ratio of labor cost to equipment
utilization cost of the small-scale mining operations, including the extraction, processing and/or marketing
activity(ies), shall not exceed on (1) for this purpose, the rental, lease and/or contracting of such equipment
shall be considered as part of the equipment utilization.
VIII. Environmental, Safety and Health, and Concerns
The SSMP/SSMC holder shall strictly comply with the environmental,
safety and health, and social provisions of R.A. No. 7942, the Philippine Mining
Act of 1995, the Small-Scale Mining Laws and their implementing rules and
regulations, among others.
VIII. Environmental, Safety and Health, and Concerns
In particular, the SSMP/SSMC holder shall comply with the following requirements:
A. The Environmental Compliance Certificate (ECC) for a small-scale mining operation shall be secured from
the Environmental Management Bureau Regional Office concerned and shall fully conform with the
provisions of the Small-Scale Mining Laws, especially with respect to the annual production limit of 50,000
DMT, area of 20 hectares per permit/contact, among others.
B. The following documents shall be required prior to the start of small-scale mining under a SSMP/SSMC:
1. Potential Environment Impact Report, which is a simplified Environmental Protection and
Enhancement Program, and a Final Mine Rehabilitation/Decommissioning Plan duly approved by
the Mine Rehabilitation Fund Committee concerned.
 2. Community Development and Management Program, a simplified Social Development and
Management Program, duly approved by the Mines and Geosciences Bureau Regional Office
concerned.
C. Small-Scale mining operations shall strictly comply with the provisions of DAO No. 97-30 in re: Small-Scale
Mine Safety Rules and Regulations.