The Joint Foreign Chambers (JFC) welcomes the release of the new Executive Order (EO) implementing reforms in the Philippine mining sector, issued under the authority of the Office of the President and appreciates it as a constructive framework upon which responsible mining can move forward in the Philippines.

The JFC’s interest is on securing a favourable investment environment in which foreign as well as local investors are encouraged to establish and build business ventures in the Philippines. While the implementation detail for the EO is still to be elaborated, the JFC believes this new mining policy has the potential to advance the objective of delivering a more favourable Philippine investment environment and direction for responsible mining.

The JFC applauds the Government’s commitment to honour existing agreements or contracts. While renegotiation of existing contracts remains open within the new EO, the JFC notes that renegotiation would only occur through mutually acceptable agreement between the government and the contractor. The JFC is of the view that retrospective or retroactive rulings or legislation by any government is detrimental to both domestic and foreign investment – and unnecessarily damaging to sovereign credibility in the international investment community. In addition, the JFC believes that the new mining policy should be implemented in line with the Philippines' obligations under highly-regarded and well-considered Foreign Investment Protection Agreements (FIPAs).

However the JFC has concerns about section 4 of the EO which states that while the government will continue to grant and issue exploration permits, it will decouple such agreements from the granting of mineral agreements which government says will not be entered into until a legislation rationalizing revenue sharing takes effect.  The JFC sees such a decoupling as a deterrent to investment. The EO states that those with exploration permits will have the first option to develop, should an economic deposit be discovered. The JFC is of the view that no mining company can be expected to spend extremely large amounts of money on exploration without certainty, the grant of a mining title and without first knowing the fiscal regime.

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