Overview of mining regulation in the Dominican Republic

Mining regulation in the Dominican Republic is one of the pillars governing this key sector of the national economy due to its impact on investment and exports. In 2024, mining represented approximately 1.4% of GDP and accounted for more than 40% of exports , with gold being the main mineral exported. This dynamic demand requires a clear, predictable, and sustainable regulatory framework.

This article provides an overview of mining regulation in the Dominican Republic , explaining the legal framework, institutions, concession regime, rights and obligations of rights holders, as well as applicable taxation and state oversight processes.

Mining activity in the Dominican Republic is regulated by a constitutional, legal, and regulatory framework, which establishes the foundation for the responsible and sustainable use of the country’s mineral resources. 

The 2015 Constitution of the Dominican Republic recognizes in Article 14 that nonrenewable natural resources constitute the national heritage, which implies that their exploration and exploitation must be carried out under the direction and control of the State. Article 17 also stipulates that these resources may only be exploited by private individuals through concessions, licenses, or contracts granted in accordance with the law and under environmental sustainability criteria. This article also establishes that the benefits received by the State from the exploitation of natural resources must be allocated to national and local development, with priority given to the provinces where they are located. 

The specific legal framework is headed by Law No. 146-71 on Mining , amended by Law No. 79-03 , which constitutes the base norm that regulates the exploration, exploitation and beneficiation of metallic and non-metallic mineral substances in the national territory. This law establishes the types of concessions, the procedure for granting them, the rights and obligations of the holders, as well as the applicable fiscal and sanctioning regime. These regulations are developed through Regulation No. 207-98 , which establishes the operational and administrative provisions for the processing and supervision of concessions, the opposition regime, environmental obligations and technical and fiscal control procedures. 

The legal framework is complemented by other special regulations, such as: 

• Law No. 64-00 on Environment and Natural Resources; 
• Law No. 123-71 on materials of the earth’s crust; 
• And various resolutions from the Ministry of Energy and Mines (MEM), which develop technical and regulatory aspects of the sector. 

Regulatory Entity 

The Ministry of Energy and Mines is the governing body of the mining sector in the Dominican Republic. Its main functions include: 

• Receive, evaluate and decide on applications for mining concessions; 
• Manage and maintain the National Mining Registry up to date; 
• Coordinate the technical and environmental supervision of mining projects; 
• Issue regulations, resolutions and complementary technical standards; 
• Promote responsible and socially sustainable mining; 
• Coordinate with other public entities on issues related to environmental impact, land use, foreign investment, and territorial development. 

For its part, the General Directorate of Mining (DGM) , a technical body attached to the Ministry of Energy and Mines, performs inspection, control, geological analysis, technical advisory, and support functions for mining companies and concessionaires. The General Directorate of Mining is also responsible for the Public Registry of Mining Rights , a technical-legal unit where all granted concessions are registered, as well as transfers, modifications, easements, expropriations, and other acts affecting mining rights. This function guarantees the legal security, publicity, and traceability of the granted rights. 

This registry is complemented by the National Mining Cadastre , also administered by the General Directorate of Mining, which provides a georeferenced database of all concessioned areas. Its purpose is to facilitate technical control of the national mining area, avoid overlaps, and support strategic planning for the sector. 

Finally, the Ministry of Environment and Natural Resources intervenes in the process by issuing environmental licenses and supervising compliance with obligations regarding environmental protection and restoration. 

Mining Law No. 146-71 establishes that all mineral substances, whether metallic or non-metallic, located in the soil and subsoil of the national territory, as well as in the subsoil of the territorial sea, the continental shelf and the exclusive economic zone, are the exclusive property of the Dominican State . This provision reinforces the character of mineral resources as public domain , inalienable and imprescriptible . Consequently, the exploration, exploitation or processing of these substances necessarily requires a concession granted by the State , through established legal procedures. 

Among the resources subject to this regime are, in addition to traditional metallic minerals, various non-metallic substances such as guano, phosphates, marble, travertine, amber, graphite, coal, lignite, talc, kaolin, industrial clays, silica and metal sands, salt, gypsum , among others. 

On the other hand, substances such as hydrocarbons, radioactive minerals , and mineral-medicinal waters are excluded from the scope of this law and are regulated by special regulations. 

The right to explore, exploit, or process mineral substances can only be acquired through concessions granted by the Dominican State, through the Ministry of Energy and Mines, after verification of compliance with legal, technical, and environmental requirements. The General Directorate of Mining provides technical support in this process, conducting feasibility analyses, conducting cadastral reviews, and making recommendations for the award. 

The granting of the right is formalized by a Mining Resolution issued by the Ministry of Energy and Mines, which constitutes the legal title that enables the exercise of mining rights. 

Mining concessions constitute a real right independent of the ownership of the land where the deposit is located, even if both ownerships are shared. These concessions are considered real estate and include not only the authorized area but also the facilities, equipment, and other assets used in the mining operation. 

The State may also declare certain areas of the national territory as fiscal reserves when deposits with strategic potential or special interest for economic and social development are identified. In these cases, exploration or exploitation rights are granted through contracts awarded through public bidding , subject to congressional approval. 

The Mining Law establishes express limitations on who may hold mining rights . In particular, the following may not exercise mining rights : 

• The President and Vice President of the Republic, the Secretaries of State, the judges of the Supreme Court of Justice, the Senators and Deputies, while exercising their functions and for up to six months after leaving office. 
• The Director General of Mining and any officials or employees of state entities involved in the supervision or management of mining activities, while in office and for up to six months after leaving office. 
• Spouses, ascendants and first-degree descendants of the aforementioned persons. 

However , these prohibitions do not apply to rights acquired prior to the appointment or election of the official , nor to concessions acquired by inheritance or legacy, or contributed by the spouses to the marriage. 

Finally, the law also expressly prohibits the granting of mining concessions to foreign governments , unless there are special agreements previously approved by the National Congress . 

Exploration Concessions 

The exploration concession grants the holder the exclusive right to conduct technical and scientific work in the soil and subsoil, with the specific purpose of discovering, delineating, and evaluating mineralized areas . This work includes geological, geochemical, and geophysical studies, as well as drilling, sampling, analysis, and metallurgical testing. The holder may also construct the necessary roads and infrastructure to facilitate these studies. 

The initial duration of this concession is three (3) years , extendable for up to two (2) additional years , provided that the concessionaire demonstrates continuity and adequate diligence in the execution of the works. 

The Mining Law establishes a maximum cumulative limit of 30,000 hectares per mining owner at this stage. Furthermore, the concessionaire has the exclusive right to apply for exploitation concessions for the explored areas, provided they comply with the established legal requirements. 

During this stage, the titleholder must fairly compensate the owners or occupants for damages caused during the exploratory work. However, they cannot object to the conduct of such activities once the corresponding compensation has been paid. All extractive activities are prohibited during the exploration stage, except with express and limited authorization issued by the General Directorate of Mining. 

Exploitation Concessions 

The exploitation concession grants the holder the exclusive right to carry out preparation , extraction, processing, smelting, refining, and marketing of mineral substances within the authorized perimeter. 

This right is granted for a maximum period of seventy-five (75) years , with mandatory tax reviews every twenty-five (25) years , in accordance with the Law. 

The maximum limit that can be accumulated per holder at this stage is 20,000 hectares of mining land . These concessions are granted by the Ministry of Energy and Mines, subject to a favorable technical evaluation by the General Directorate of Mining. 

Holders of mining concessions have the right to access the authorized area and are required to compensate for any damages they may cause to owners or occupants. They are also subject to strict compliance with all labor, health, environmental, social security , and other regulations applicable to mining activities. 

Processing Plants 

In addition to the concession regime, the Mining Law provides for the installation of beneficiation plants , which are industrial establishments dedicated to the processing of mineral substances through mechanical concentration or mining-metallurgical treatment , including smelting or refining, to obtain marketable mineral products. 

The installation of these plants does not require an exploitation concession if the processed minerals come from third parties. However, express authorization from the Ministry of Energy and Mines is required, based on prior review of the technical plans and complementary reports , which must also be approved by the Ministries of Public Works and Public Health. 

The installation of these plants is not permitted in areas where they may pose a risk to regional health , in accordance with the provisions of the Ministry of Public Health. 

The owners of processing plants enjoy rights equivalent to those of mining concessionaires regarding the application for expropriations and the establishment of easements necessary for their operation. These facilities must comply with current labor , construction, health, and industrial hygiene regulations and are subject to periodic inspections by the General Directorate of Mining. 

Rights of Concessionaires 

Pursuant to the Mining Law, the resolution issued by the competent authority constitutes the enabling title that grants the concessionaire the exclusive right to explore, exploit, or process mineral substances within the authorized perimeter. 

Among the main rights recognized to the concessionaire are: 

• Use of the subsoil : Mining activities may be carried out underground, even without being the owners of the surface land, provided that they compensate for the damage caused. 
• Construction and installations : They are authorized to erect buildings, camps, warehouses, processing plants, transportation systems, oil pipelines, docks, canals and other necessary infrastructure, in accordance with current regulations. 
• Access through third-party land : You can access the concession area by crossing state or private property, using the least harmful route and respecting legal provisions. 
• Right to expropriation : In justified cases, and with prior compensation, they may request the expropriation of land necessary for the development of their operations. 
• Use of water resources : They are authorized to use freely flowing water within the concession area for their mining operations, including hydraulic power production, with the obligation to return it to its channel purified and free of harmful substances. If the necessary water is privately owned, they may use it by prior agreement with the owner or through an authorized expropriation process, provided that it does not affect the supply of drinking water to the population. 
• Protection against arbitrary suspension : Your activities may not be suspended, except for reasons of force majeure, reasons of public interest or when the life and health of workers are at risk. 
• Mining easement rights : They may request the establishment of easements necessary for their operations. 

Obligations of the Concessionaire and State Supervision 

Mining concessions entail a series of technical, legal, fiscal, and environmental obligations regulated by the Mining Law and its complementary regulations. These include: 

• Start and continuation of operations : Work must begin within the established timeframe (6 months for exploration; 1 year for exploitation or processing plants) and continue continuously. Unjustified stoppage may result in the expiration of the concession. 
• Periodic reports : They must submit semi-annual and annual reports to the General Directorate of Mining, detailing activities carried out, production, reserves, technical methods, expenses and economic indicators. 
• Registration and accounting : They are required to keep formalized accounting books and designate a legal address with an authorized representative before the competent authorities. 
• Payment of taxes : They must comply with the payment of annual patents, royalties, income taxes and other taxes, and present proof of payment to the General Directorate of Mining . 
• Access and oversight : They must allow free access to their facilities by authorized officials and provide all technical, statistical or documentary information required for oversight or audit purposes. 
• Safety and health : They must carry out their operations using methods that guarantee the safety of workers, the stability of neighboring structures, and the protection of the environment. 
• Relations with third parties : They must agree with owners or occupiers on the use of land for mining facilities, and share the costs of access roads when these are used by multiple concessionaires. 

State oversight falls primarily to the Ministry of Energy and Mines, the General Directorate of Mining, and the Ministry of the Environment, which conduct periodic technical and environmental inspections. These entities are empowered to impose administrative sanctions, including fines, suspension of activities, revocation of permits, and immediate environmental restoration in the event of noncompliance. 

Termination of Concession Rights 

The rights granted through exploration or exploitation concessions are not perpetual . The Law establishes that these may be extinguished by expiration of the term , voluntary surrender , nullity , or expiration , as appropriate: 

• Exploration concessions expire automatically after three (3) years , or five (5) years if the additional extension permitted by law has been granted. 
• Exploitation concessions have a maximum duration of seventy-five (75) years , with mandatory tax reviews every twenty-five (25) years from their granting. 
• The concessionaire may also renounce his concession in whole or in part at any time by formal notification to the competent authorities. 

These provisions seek to ensure a predictable and balanced legal framework that allows concessionaires to plan their investments and operations, while ensuring strict compliance with the legal, fiscal, and environmental obligations governing the mining sector. 

Mining activity in the Dominican Republic is subject to a complex and mixed tax regime, composed of general taxes applicable to all companies and specific taxes on the extractive sector, established in the Mining Law and other sectoral regulations. This regime applies to both concession holders and companies developing mining projects, and may vary depending on the type of mining right, whether by concession or contract, under which the holder operates. 

General Tax Regime

Holders of mining concessions, both metallic and non-metallic, are subject to a general tax regime established in Mining Law No. 146-71, the Tax Code (Law No. 11-92), and other complementary provisions. The main applicable taxes include the following: 

• Annual mining license: Fixed tax paid to the Ministry of Energy and Mines, calculated based on the number of hectares awarded. Rates range from RD$0.10 to RD$2.00 per hectare. This tax is neither deductible nor creditable. 
• Mining royalty: This corresponds to 5% of the FOB value of mineral exports in their natural state or as concentrates. This royalty can be credited against the Income Tax (ISR) for the same fiscal year. Minerals exported as refined metals or metallic compounds are exempt. 
• Income Tax (ISR): Mining companies are taxed according to the general rate on their net income, as provided by the Tax Code. 
• ITBIS and other general taxes: In addition to Income Tax, companies in this sector are subject to paying the Tax on the Transfer of Industrialized Goods and Services (ITBIS), as well as other common tax obligations applicable to ordinary taxpayers. 

Additionally, the mining tax regime is complemented by environmental and administrative provisions, which also impose specific burdens on companies in the sector. These include: 

• Municipal environmental contribution: According to Law No. 64-00, 5% of the net profits generated by the exploitation of non-renewable resources must be allocated to the municipalities where such activities are carried out. 
• Non-metallic extraction fee: Law No. 123-71 imposes a fee of RD$0.10 for each cubic meter of extracted materials such as sand, gravel, and stone, of which 50% is transferred to the corresponding municipality. 
• Complementary environmental fee: Established by Decree No. 145-03, it applies to the use of certain natural resources and is managed by the Ministry of the Environment. 
• Administrative fees: Established in resolutions of the Ministry of Energy and Mines (Res. 035-16) and the Ministry of Environment (Res. 0011-16), these fees cover technical services, licenses, and permits required to operate in accordance with current regulations. 

Contractual Regime

In some large-scale projects, mining operations are formalized through special contracts signed between the Dominican State and the mining company. These contracts, which must be approved by the National Congress, may establish differentiated tax regimes, including special income tax rates, profit sharing, net smelter return payments, and other specific taxes. Examples of this type of regime include the contracts with Falconbridge Dominicana SA (nickel) and Pueblo Viejo Dominicana Corporation (gold). 

The development of responsible and sustainable mining, aligned with national interests, requires not only strict compliance with the current legal framework, but also adequate technical planning, effective oversight by the competent authorities, and the active participation of communities and other stakeholders. 

The Dominican Republic has a regulatory framework that thoroughly regulates the technical, legal, fiscal, and environmental aspects of mining activity. However, changes in the international context, as well as growing social and environmental challenges, have highlighted the need to update this legislation. 

In response to this reality, the Ministry of Energy and Mines, together with the Executive Branch, has promoted the development of a National Mining Bill, with the aim of modernizing Law No. 146-71 and adapting it to the country’s new socioeconomic, technical, legal, and institutional realities. Since 2017, several versions of the draft bill have been developed, the most recent being submitted to the Executive Branch in February 2021. This reform proposal seeks to strengthen the principles of sustainability, transparency, governance, and social benefit associated with mining activity. 

Given this situation, companies and investors interested in developing mining projects in the country must have specialized legal advice that allows them to fully comply with regulatory requirements from the prospecting stage to the closing of operations. Likewise, it is essential to establish a proactive and transparent relationship with local authorities and communities as a basis for ensuring the long-term viability, legality, and legitimacy of their projects.