Policy and Legislation:

All mineral resources that exist at the surface or under land or water, within the territory of the Lao PDR, are the property of the national community and are subject to the centralized and unified management of the State.

The Mining Law has been promulgated in May 1997 and its Implementing Decree Was approved in October 2002. Mining activities is governed conjointly by the Foreign Investment Law, Mining Law, Implementing Decree and Ministerial Regulations as well as relevant fiscal and taxation Laws and Decrees. (Click here to access the full Mining Law)

Investment in Mining activities shall take place under one of the following forms:

A. Sole investment by the State;

B. Joint investment between the State and domestic and /or foreign parties; and

C. Collective or private investment from domestic parties.

Mineral Exploration and Production Agreements (MEPA) which have been signed in Lao PDR to date often contain basic provisions reiterating the ownership of mineral resources by the Lao Nation and the development of these resources through agreements between the Government represented by the Foreign Investment Management Committee (FIMC) and relevant Ministerial and the investor.
Fiscal regimes:
The fiscal obligations under Mining Law, licensees shall have the obligation to properly and timely performs custom, tax and other fiscal regimes.

Companies doing mineral business under MEPA is subject to the following levies:

1. Rental fee

A. General Survey and Exploration for different minerals respect the rate 0.5-1 US$ /ha /y

B. Preparatory mining (Feasibility and Construction Phase) and Mining for different minerals respect
the rate 3-12 US$/ha/y.

2. Royalty

Royalty for mineral production are computed and levies on the basic of the gross sales value of mineral.
The rate of royalty varies from 2 - 5%.

Examples rate of royalties for different minerals: Iron 2%; Copper 3%; Lead 3%; Zinc 3%; Tin 2%; Gold 5%,
Silver 4%;Platinum 5%; Sapphire 5%; Ruby 5%; Emerald 5%; Potash 2% and Gypsum 2%.

3. Tax

In accordance with the Promotion and Foreign Investment Management Law, Foreign investor shall pay annual
profit tax uniform flat rate 20%

For foreign investments involving natural resources exploitation and energy generation sector, specific taxes and
royalties shall be prescribed in the MEPA. These rate of profit tax can be negotiated privileged income tax rates of
20-35 % seem generally to be the norm in the mining sector at present.

A tax levy at the rate of 10% is imposed on dividend and retained earning. No similar or additional profit tax which
might be levied in the event of a windfall or highly profitable investment.

4. Import and Re-Export Facilities

Foreign Investment shall pay an import duty on equipment, means of production, spare parts and other materials
used at maximum rate 1% of imported value.

Any imported equipment, machinery no longer needed for general survey, exploration, feasibility study,
construction and production activities may re-exported from duties and restrictions on export of whatever nature,
applicable Law and sold in Lao PDR upon of any applicable duties on price of item at the time of such sale.

5. Individual income tax for expatriate employees

As a general rule, expatriate employees are subject to a personal income tax depending on their length of stay in the
country and their personal working within Lao PDR shall pay to Lao Government personal income tax at a flat rate
of 10% of their income earned .

6. Filing Fees

A. Prospecting License (Issue and renewal) 15 US$

B. Exploration License (Issue and renewal) 20 US$

C. Mining License:

- Large Scale (Issue and renewal) 100 US$

- Medium Scale (Issue and renewal) 80 US$

- Small Scale (Issue and renewal) 50 US$

D. Artisan Mining License (Issue and renewal) 5 US$