• Area of Law： Geology & Mining
• Level of Authority： Local Government Rules
• Date issued：07-04-2003
• Effective Date：08-01-2003
• Issuing Authority： Shanxi Province
• Status： Effective

Order of the People's Government of Shanxi Province
(No. 164)
The “Interim Provisions of Shanxi Province on Public Transfer of Mining Rights”, which were adopted at the 7th executive meeting of the Provincial People's Government on July 1, 2003, are hereby promulgated, and shall come into force on August 1, 2003.
Liu Zhenhua, Governor
July 4, 2003
Interim Provisions of Shanxi Province on Public Transfer of Mining Rights
Chapter I General Provisions
Article 1 The present Provisions are formulated in accordance with the “Law of the People's Republic of China on Mineral Resources”, the “Measures on the Administration of Registration of Regions for Prospecting Mineral Resources”, the “Measures on the Administration of Registration of Mining of Mineral Resources” and other laws and regulations with a view to regulating the public transfer of mining rights, improving the system of paid transfer of mining rights, and optimizing the allocation of mineral resources.
Article 2 The public transfer of mining rights within the jurisdiction of this Province shall be governed by the present Provisions.
Article 3 Mining rights mentioned in the present Provisions include mineral prospecting right and mining right.
Article 4 The public transfer of mining rights shall be in the ways of bid invitation, auction or listing.
Article 5 The public transfer of mining rights shall comply with the principles of publicity, fairness, honesty and credibility.
The public transfer of mining rights shall conform to the industrial policies and the mineral resource planning of the State, and be in combination with the situation of market supply and demands.
Article 6 The administrative department of land and resources under the people's government at the county level or above (hereinafter referred to as the competent department) shall, within the scope of power for approving and issuing certificates as prescribed in laws and regulations, be responsible for the public transfer of mining rights.
An inferior competent department shall, if intending to publicly transfer a mining right, report to the superior competent department for approval or record, and be supervised by the superior competent department.
The relevant competent department under the people's government at the county level or above shall perform the duties imposed by laws and regulations.
The public transfer of the rights in the coal mine or metal ore industry may not be arranged for implementation before approved by the Provincial People's Government.
Article 7 A newly set mining right shall be in the way of public transfer, except for the surveying projects funded by the State or using mineral resource compensation fee at the provincial level.
To set mining rights at the following orefields, the way of public transfer shall be adopted:
(1) an orefield surveyed and found out with funds of the State;
(2) an orefield which has lost mining rights;
(3) an orefield with mining rights not having been set.
Article 8 Before a mining right is publicly transferred, the competent department shall entrust an evaluation institution qualified to evaluate mining rights to evaluate the said right, except for the small river sand and the clay used for making bricks and tiles.
The result from evaluation shall, after being confirmed by the competent department, be considered as the basis of the minimum bid or minimum price of the mining right in public transfer.
Article 9 The bid winner and the vendee who acquires a right in the coal mine industry in the way of public transfer may choose on its initiative to apply for the prospecting permit or mining permit.
The coal mine prospecting right and the coal mining right shall be evaluated in the same way.
Chapter II Bid Invitation
Article 10 Bid invitation concerning a mining right as mentioned in the present Provisions means that the competent department invites, by a notice for bid invitation or by a bid invitation letter, uncertain or certain legal persons, natural persons or other organizations qualified as the applicants for mining rights to participate in a bid, and determines the bid winner of the mining right according to the result of the bid.
Article 11 The competent department for the bid invitation of mining rights shall announce a notice for bid invitation or send out a bid invitation letter.
The notice for bid invitation or the bid invitation letter shall include the following contents:
(1) name and address of the competent department;
(2) scope of the mining area with the mining right under planned transfer, brief information on geological minerals and the scale of reserves, etc.;
(3) ways to obtain the bid invitation documents;
(4) qualification requirements for the bidders;
(5) amount of the guaranty bond for implementation of the contract and the time of payment;
(6) time and place for applying for bidding and examination of qualification;
(7) expiry date of bidding and the bidding place;
(8) other particulars necessary to be stated.
The competent department shall determine the reasonable time needed by the bidders to work out the bidding documents, provided that the period from the day when the bid invitation documents are sent out up to the expiry date for bidding shall be no less than 30 days.
Article 12 The competent department shall form a committee for examination of the bidders' qualifications. When necessary, the qualification examination committee may absorb experts from such relevant departments as the coal administrative department to participate the examination.
Article 13 The bidders shall fill out the bidding documents, and shall, after sealing the said documents, tender bids and pay the guaranty bond for bidding within the prescribed time.
A bidding document shall be invalid if:
(1) it exceeds the expiry time for bidding;
(2) the main factors of the bidding documents are lacked, the annexes of the bidding documents are incomplete, or the characters in the bidding documents are unclear to be recognized;
(3) the bidder entrusts others to tender the bid but the entrustment documents are incomplete or do not conform with the provisions;
(4) the bid is repeatedly tendered;
(5) the bidder tenders the bid by practicing frauds; or
(6) other circumstances of invalidity prescribed in laws, regulations and rules.
Article 14 The bid shall be opened publicly at the time and place determined in the bid invitation documents. The opening of the bid shall be presided by the person sent by the competent department, and all the bidders shall be invited to attend the opening.
The process of the opening of the bid shall be recorded and kept in file for consultation.
When a bid is opened, the seal of the bidding documents shall be inspected by the bidders or their representatives, or may be inspected and notarized by a public notary institution entrusted by the competent department; after the bidding documents are confirmed to have no error, the working members shall unseal them publicly, read the names of the bidders, the bidding prices and other main contents of the bidding documents.
Article 15 The responsibility to evaluate a bid shall remain with the bid evaluation committee formed by the competent department. The bid evaluation committee shall be composed of representatives from the competent department and the relevant experts in the field of technology and economics, etc., with the members to be no less than five persons in odd number, among whom the experts in the field of technology and economics, etc. shall be no less than two thirds of the total number of members.
The name list on the members of the bid evaluation committee must be kept confidential before the result on the winning of the bid is announced.
The bid evaluation committee shall, according to the standards and ways determined in the bid invitation documents for evaluating bids, evaluate and examine as well as compare the bidding documents. The bid evaluation committee shall, after evaluating the bid, render a written bid evaluation report to the competent department, and recommend qualified candidates for winning the bid.
The competent department shall determine the bid winner on the basis of the written bid evaluation report rendered and the candidates for winning the bid recommended by the bid evaluation committee, or may authorize the bid evaluation committee to directly determine the bid winner.
Article 16 After the bid winner has been determined, the competent department shall conclude the letter on confirmation of the bargain and the contract on bid invitation and transfer of the mining right with the bid winner, and make registration in accordance with the law within the stipulated time limit.
Chapter III Auction
Article 17 Auction of a mining right as mentioned in the present Provisions means that the competent department announces the auction notice for the bidders to an auction who are qualified as the applicants for the mining right to bid publicly at the designated time and place, and transfer the mining right to the one who responds the highest price.
Article 18 The competent department for auction of mining rights shall announce the auction notice 20 days prior to the auction day.
An auction notice shall include the following contents:
(1) name and address of the competent department;
(2) scope of the mining area with the mining right under planned transfer, brief information on geological minerals and the scale of reserves, etc.;
(3) qualification requirements for the bidders to an auction;
(4) ways to obtain the auction documents;
(5) time, place and bidding method of the auction, with the minimum price, if any, being specially declared;
(6) ways to determine the vendee;
(7) amount of the guaranty bond for implementation of the contract and the time of payment thereof; and
(8) other particulars necessary to be announced.
Article 19 The competent department shall form a committee for examination of the qualification of the bidders to an auction. When necessary, the qualification examination committee may absorb experts from such relevant departments as the coal administrative department to participate the examination.
Article 20 If there is a minimum price for an auction, and the highest price responded by the bidders to the auction does not reach the minimum price, the responded price shall not become effective.
Article 21 After the bargain of an auction is made, the competent department and the vendee shall conclude the letter on confirmation of the bargain and the contract on auctioned transfer of mining rights in accordance with the relevant provisions, and shall make registration within the stipulated time limit.
Chapter IV Listing
Article 22 Listing of a mining right as mentioned in the present Provisions means that the competent department announces a listing notice, and accepts the quotations of the bidders to the auction within the time limit and at the place prescribed in the listing notice, and updates the listed price, as well as determines the vendee of the mining right according to the bidding result at expiry of the time limit for listing.
Article 23 For the listing of a mining right, the competent department shall announce the listing notice 20 days before the first day of the listing.
The listing notice shall include the following elements
(1) name and address of the competent department;
(2) scope of the mining area with the mining right under planned transfer, brief information on geological minerals and the scale of reserves, etc.;
(3) qualifications of the bidders to an auction;
(4) ways to obtain the listing documents;
(5) time and place of listing, initial price, rules on increasing the price, range for increasing the price, etc., with the minimum price, if any, being specially declared;
(6) ways to determine the vendee;
(7) amount of the guaranty bond for implementation of the contract and the time of payment thereof; and
(8) other particulars necessary to be announced.
Article 24 The time of listing shall be no shorter than 10 working days. During the period of listing, the bidders to an auction may quote prices for more than one time.
Article 25 The bidder to an auction who quotes the highest price which is higher than the minimum price, or the bidder to an auction who submits at earliest the price quotation list among the same quoted prices shall be the vendee, and the bargain shall be listed to have been made.
If, within time limit for listing, no one bids for the auction or the prices quoted by the bidders to the auction are lower than the minimum price, it shall be listed that the bargain is not made.
Article 26 After the bargain is listed to have been made, the competent department and the vendee shall conclude the letter on confirmation of the bargain and the contract on listed transfer of the mining right in accordance with the relevant provisions, and shall make registration within the stipulated time limit.
Chapter V Other Provisions
Article 27 The bid winner or the vendee shall, after concluding the contract on transfer of the mining right with the competent department, apply to the administrative organ for the registration of mining rights for obtaining the prospecting permit or mining permit within the time limit stipulated in the contract. If the bid winner or the vendee fails to apply to the administrative organ for the registration of mining rights within the time limit for making the registration, it shall be regarded as waving the right automatically.
The guaranty bond for bidding or for the bid to the auction, which is paid by the bid winner or the vendee, may be used to offset the price of the mining right. For the guaranty bond for bidding or for the bid to the auction, which is paid by other bidders or bidders to an auction, the competent department must return them within 5 working days after the end of the public transfer, without calculating the interest.
Article 28 The bid winner or the vendee shall, before obtaining the prospecting permit or mining permit, pay the price of the mining right in public transfer in a lump sum; if the amount of the price of the mining right is large, it may be paid by installments in accordance with the relevant provisions of the state upon consent by the competent department, provided that the initial payment shall be no less than 30%.
If the bid winner or the vendee fails to pay the price of the mining right as stipulated, the competent department may recall the said right in accordance with the law.
If the competent department fails to obtain the prospecting permit or mining permit in accordance with the provisions, the bid winner or the vendee may apply for administrative reconsideration or brings an administrative lawsuit in accordance with the law.
Article 29 The total amount of the price of mining rights shall be fully turned in to the treasury, with the specific measures of administration and use complying with the relevant provisions of the State.
Chapter VI Legal Liabilities
Article 30 If the bid winner or the vendee commits any of the following acts in violation of the present Provisions, the bid it has won shall be invalid, and the paid guaranty bond for bidding or for the bid to the auction shall not be refunded; if there is any loss, it shall bear the compensation liability in accordance with the law. The relevant department may impose administrative penalties upon the relevant liable persons in accordance with the law:
(1) Providing false documents to conceal the facts;
(2) Colluding with others in bad faith;
(3) Offering bribes to the competent department or the bid evaluation committee or any of the members thereof; or
(4) Winning the bid by other illegal means.
Article 31 The bid winner or the vendee shall, after obtaining the prospecting permit or mining permit, make the survey or start the construction in accordance with the relevant provisions. If it violates the provisions by failing to make the survey or start the construction on time, it shall be punished in accordance with the law; if the case is serious, its prospecting permit or mining permit shall be suspended in accordance with the law.
Article 32 If any member of the bid evaluation committee violates the present Provisions by accepting a bidder's properties or other benefits, or discloses the minimum bid or other relevant information to others, his qualification as a member of the bid evaluation committee shall be canceled by the competent department; if a crime is constituted, he shall be investigated for criminal liabilities in accordance with the law.
Article 33 If any functionary of the competent department violates the present Provisions by neglecting his duties, abusing his power or practicing frauds for personal gain in the public transfer of mining rights, but a crime is not constituted, he shall be imposed upon administrative sanctions in accordance with the law; if a crime is constituted, he shall be investigated for criminal liabilities in accordance with the law.
Chapter VII Supplementary Provisions
Article 34 With respect to the coal mine prospecting right acquired by means of administrative approval prior to the present Provisions' entry into force, if the applicant applies within the validity period for the mining right after finding out the coal mine which may be mined, it may acquire the mining right in priority, instead of acquiring it be means of public transfer, provided that it must pay a certain amount of price difference between the actual acquisition price and the price in public transfer of the mining right.
Article 35 If a holder of a mining right transfers the right, it shall comply with the “Measures on the Administration of Transfer of Mineral Prospecting Rights and mining rights” promulgated by the State Council.
Article 36 The administrative department of land and resources under the Provincial People's Government may formulate detailed rules for the implementation of the present Provisions.
Article 37 The present Provisions shall come into force on August 1, 2003.