Recently, the Ministry of Finance, the Ministry of Natural Resources, and the State Administration of Taxation jointly issued the “Measures for the Collection of Proceeds from the Transfer of Mineral Rights” (hereinafter referred to as the “Measures”), aimed at further improving the system of paid use of mineral resources, standardizing the management of the collection of proceeds from the transfer of mineral rights, safeguarding the state’s ownership rights over mineral resources, promoting the protection and rational utilization of mineral resources, and fostering the healthy and orderly development of related industries. The “Measures” refine the method for collecting proceeds from the transfer of mineral rights, shifting from the current practice of requiring a “one-time lump-sum payment” for most mineral types at the time of transfer to a new approach under which 144 mineral types will be subject to a collection model based on “the transaction price plus an annual rate.”
　　It is reported that the revenue from the transfer of mining rights refers to the paid-use income from state-owned resources collected by the state from mining right holders in accordance with the law, based on its ownership of natural resources. The revenue from the transfer of mining rights includes revenue from the transfer of prospecting rights and revenue from the transfer of mining rights, and in principle, such revenue is collected according to the location of the mining rights.
　　The Measures specify two methods for collecting revenue from the transfer of mineral rights: one is collection based on a royalty rate applicable to the transfer of mineral rights, and the other is collection based on the amount of the transfer fee.
　　The mineral types listed in the “Catalog of Mineral Types Subject to Royalty-Based Collection of Mining Rights Transfer Revenue (Trial)” (hereinafter referred to as the “Catalog”) shall have their mining rights transfer revenue collected in the form of a royalty rate. Specifically, for exploration and mining rights transferred through competitive bidding, the transaction price determined through competition shall be collected upon transfer; during mine exploitation, the mining rights transfer revenue shall be collected annually according to the royalty rate stipulated in the contract. The royalty rate for mining rights transfer shall be determined in accordance with the standards set forth in the “Catalog.” For exploration and mining rights transferred via agreement, the transaction price shall be based on the initial bid price and collected upon transfer; during mine exploitation, the mining rights transfer revenue shall be collected annually according to the royalty rate applicable at the time of sale of mineral products.
　　For mineral resources not listed in the “Catalog of Mineral Types,” the revenue from the transfer of mining rights shall be collected in the form of a transfer fee. Among these, for exploration and mining rights transferred through competitive bidding, the revenue from the transfer of mining rights shall be determined based on the outcome of the bidding process. For exploration and mining rights transferred via agreement, the revenue from the transfer of mining rights shall be determined by taking the higher value between the assessed value and the benchmark market price for the revenue from the transfer of mining rights. The revenue from the transfer of mining rights collected in the form of a transfer fee may be paid in installments; the initial payment shall account for no less than 10% and no more than 20% of the total revenue from the transfer of exploration and mining rights.
　　According to the introduction, the “Catalog of Mineral Species” includes 144 mineral species—out of a total of 173—that play an important strategic role, pose relatively high exploration risks, and have significant impacts on industrial chains. These include all energy minerals, metallic minerals, precious and semi-precious stones, water and gas resources, and most non-metallic minerals. The royalty rates for the transfer of rights to the mineral species listed in the “Catalog of Mineral Species” are jointly formulated by the Ministry of Natural Resources and the Ministry of Finance.
　　With regard to the transition between old and new policies, the Measures provide detailed regulations—divided into three time periods: before July 1, 2017; from July 1, 2017 to the date on which these Measures take effect; and after the date on which these Measures take effect—on whether the relevant areas involve mineral deposits identified with state-funded exploration and whether they are included in the “Catalog of Mineral Species.”
　　The Measures shall take effect as of May 1, 2023. The Provisional Measures for the Collection and Administration of Proceeds from the Transfer of Mineral Rights (Cai Zong [2017] No. 35) and the Notice of the Ministry of Finance and the Ministry of Natural Resources on Further Clarifying Relevant Issues Concerning the Collection and Administration of Proceeds from the Transfer of Mineral Rights (Cai Zong [2019] No. 11) shall be repealed concurrently.