Mining (State Participation) Regulations, 2020 (G.N. No.939 of 2020)

(a) shares shall be treated as a special class of shares, in which case the holder share shall be entitled to the payment of dividend of a fixed amount in priority to another class or classes of shares; and

(b) shares shall not decrease in value or percentage of ownership of a shareholder or loss of some percentage of equity. Acquisition 5.-(1) Subject to regulation 6, the Treasury Registrar of shares shall acquire not less than sixteen percent non-dilutable free carried interest shares in the capital of a mining company or any other person holding mining licence or special mining licence on behalf of the Government. (2) Without prejudice to sub-regulation (1), the Treasury Registrar on behalf of the government may also acquire in total up to fifty percent of the shares in a mining company or any other person holding mining licence or special mining licence commensurate with the total tax expenditures incurred by the Government in favour of a mining company or a person holding mining licence or special mining licence. (3) The acquisition of shares as referred to under sub- regulation (2) shall be determined by the total value of the tax expenditures enjoyed by the mining company or a person holding mining licence or special mining licence through tax exemptions and reliefs. (4) In every two years after the commencement of these Regulations, the Government shall review tax expenditures enjoyed by the mining company or a person holding mining licence or special mining licence in determining number of shares to be acquired by the Government. (5) The computation of Government shares shall base on an amount of tax expenditure enjoyed by that mining company up to the date of computation divide by the market value of shares at the date of computation. (6) Any benefit enjoyed by the mining company through stabilization arrangement under Section 100E of the Act shall be included in the computation of the Government shares. Determination 6.-(1) For the purposes of acquisition of shares under of 2 Mining (State Participation) GN NO. 939 (Contd.) level of these Regulations, the Commission in consultation with the investment office of the Treasury Registrar and Tanzania Revenue Authority shall from time to time determine the types of minerals or level of investment made by a holder of special mining licence or mining licence on which the government shall be entitled to acquire the said sixteen percent non- dilutable free carried interest shares or more. (2) In determining the level of investment, the following shall be taken into consideration as determined by the Commission- (a) capital invested; (b) mining technology involved;

(c) profit; and

(d) total value of tax expenditures enjoyed by the mining company. Control of 7.-(1) The Treasury Registrar shall, in consultation government with the Commission, be responsible for all matters relating to shares the managing and control of the government shares in the capital of the mining company or a person holding mining licence or special mining licence. (2) Notwithstanding sub regulation (1), the Treasury Registrar shall be assisted by the Ministry of Finance and Planning, Ministry of Minerals, Commission, Bank of Tanzania and Tanzania Revenue Authority. Provision of 8.-(1) The Commission shall have the duty to provide relevant relevant information to the Office of the Treasury Registrar in information relation to the type of minerals of which the Government is entitled to- (a) sixteen percent or more of non-dilutable free carried interest shares in the capital of the mining company or a person holding mining licence or special mining licence; (b) information relevant for the acquisition of addition shares of up to fifty percent. (2) A mining company or person holding mining licence or special mining licence shall, in such a manner as the Commission may determine, disclose relevant information to the Commission relating to expenditures, production, revenue and profit. Mode of 9.-(1) The Treasury Registrar shall determine the mode payment of payment of profit resulting from non-dilutable free carried of interest on share of interest shares or other addition shares to the Government Government under section 10 of the Act. (2) In determining the mode of payment to the Government, the Treasury Registrar shall notify in writing the mining companies or any other person holding mining licence 3 Mining (State Participation) GN NO. 939 (Contd.) or special mining licence on the procedures of payment of profit resulting from non-dilutable free carried interest or other additional shares to Government. Rights of 10.-(1) The Government by holding sixteen percent or holder of non - more non – dilutable free carried interest shares in the capital dilutable free carried interest of the mining company shall enjoy the right stipulated under shares the Companies Act, including the right to: Cap. 212 (a) be issued with shares certificate as evidence of title over a number of shares held in a mining company; (b) be registered in members’ register of the company which shall be kept at the registered office of the company within Tanzania; (c) participate in company’s statutory meetings, including annual general meetings and other meetings and its right to vote; (d) participate in the governance of the company;

(e) have access to company’s reports relating to company’s accounts, director’s and auditor’s reports;

(f) to receive dividends;

(g) appoint a director to represent Government interest subject to the provisions of the Memorandum and Articles of Association.;

(h) participate in the removal of a director;

(i) automatic allotment to it of shares of a mining company without direct financial contribution by cash or otherwise for the value of shares;

(j) actual ownership of the non - dilutable free carried interest shares from the start;

(k) receive a proportionate share from any repayment of either equity, shareholding loan or third-party loan. Nature of free 11.-(1) The Government by holding sixteen percent or carried interest more non – dilutable free carried interest shares in the capital relating to holding shares of the mining company shall have no obligation to: - in the capital of (a) subscribe for shares neither to show readiness or mining commitment to take up shares or stock by actually company subscribing to the Memorandum and Articles of Association; (b) contribute any equity capital, repayment of shareholder loan or third-party loan. Interest shares 12. The remaining shares of the investment mining of Company beside those of the Government shall be deemed to mining 4 Mining (State Participation) GN NO. 939 (Contd.) company be total capital of the mining company required for investment and run of the project for the lifetime of the project. Allotment or 13.-(1) The free carried interest shares to the issuance Government shall be allotted or issued to the Government as of free carried interest part of state participation in mining operations. shares to the (2) The free carried interest shares to the Government government shall be deemed to be fully paid up shares at the time of its allotment or issuance. (3) The free carried interest shares to the Government shall exist throughout the life time of the mineral right of a mining operation. Issuance of 14.-(1) The Minister responsible for mining affairs, in directive consultation with the Minister responsible for finance, may issue specific or general directives to the Treasury Registrar or any mining company on proper administration of the Government shares in the mining company or a person holding mining licence or special mining licence. (2) The Treasury Registrar, in consultation with the Commission, may issue specific or general directives to any mining company or a person holding mining licence or special mining licence relating to Government shares in that a mining company or a person holding a mining licence or special mining licence. Dodoma DOTO MASHAKA BITEKO 21st October, 2020 Minister for Minerals 5