MINING AND TREASURE IN MEXICO
The Law: Per the Federal Mexican Constitution, the Federal Mexican Government owns and holds all the mineral and petroleum resources located under the surface of the ground (In other words, the owner of land in Mexico only owns the surface thereof and any non-restricted treasure therein).
Federal Mexican Mining Law: In order for a party to acquire rights to mine minerals in Mexico they are required to apply for and acquire a mining concession. The Ministry (Secretariat) of Mining is the Federal Mexican Government ministry charged with controlling all mining matters.
It is possible for Mexican individuals to acquire the mining concessions in his or her own. However, the foreigners are required to do so thorough a Mexican mining corporation that they are to set up. The Mexican as well as the foreigners are permitted to acquire up to 100% of the Mexican mining company they set up to hold mining concessions..
The applicant of a mining concession must identify the specific minerals that he/it wishes to mine, as well as the exact location at which they wish to mine them. These rights of mining can not hinder or restrict the rights of use and ownership that a person has on the surface of the location, therefore, it is normal that the concessionaire is the owner or rightholder of the land under which the mine will exist.
The three types of concession that may exist are Beneficial Plant, Exploration and Exploitation. Following are brief descriptions of these three types of concessions.
The Beneficial Plant Concession: Is authorization to process (smelter) the mineral that is acquired by it or third parties under their mining concessions.
The Exploration Concession: Is the concession first granted to permit the miner to explore and extract mineral to proof-up the mine. These concessions may be good for up to 6 years.
The Exploitation Concession: Once certain activities set in a mining program by the mining authority are complied with in a determined time period, then the Ministry of Mining will permit the application for an Exploitation Concession. The Exploitation Concessions permit the full exploitation of the minerals that were approved in the concession. These concessions may be good for up to 50 years.
National Mining Reserves: There are certain areas of Mexican that are known as National Mining Reserves, which usually are rich in value minerals. These places are where the Mexican Mining Authority place special conditions on granting or using mining concessions, permitting the government to receive more participation or profit form the mining process.
Expropriation: Some limited rules on expropriation exist in order to carry out the mining activity. In general terms, the federal government of Mexico does have the right to expropriate private property for public good. However, it is not abused for concern of public outcry.
Treasure: The owner of the land is also the owner of the treasure buried in the ground of the land he owns, unless the treasure is of historical, social or cultural value, then it belongs to the Mexican Nation. Treasure is identified by the fact that it was either created by man, transformed by man or in mans' domain but buried in the ground (such as gold in a pouch). The civil codes of each state of Mexico deal with issues of who keeps the treasure (provided the federal government does not exercise its' preference of historical, social or cultural value).
Taxes: Even though all the mineral extracted from a mine under an Exploitation concession is normally owned by the concessionaire, in Mexico there are federal income taxes, federal taxes on Mine Concessions and federal Commercial Asset Taxes. As well, if treasure is found that is income and taxed as such under the federal income tax rules. See the webpage on Taxes elsewhere in this webpage.
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