Mining Law is a branch of the legal sciences mainly destined to facilitate the exploitation of mineral resources, activity of national interest, according to the Constitution of the Federative Republic of Brazil. However, the path to mining and future mineral production goes through several stages that demand expressive investments and a long time. The awareness of the complexity of this process determines the importance of the phase preceding the acquisition of mining rights, this instrument and, as a consequence, the success of the established venture.
The pre-contractual stage requires a strategic performance that includes evaluation of mineral assets and risks that the acquisition may bring to the purchaser. At this stage, it is recommended that a meticulous Due Diligence (DD) be carried out, consisting of a set of actions aiming at previously knowing the actual situation of the company holding the mining rights, securities or mining complex, as appropriate, in view of the risks associated to the alleged transaction, in event of acquisition of mining assets. The purpose of such prior due diligence, in general, is to determine the regularity of assets that are intended to be acquired and assess the risks that the new owner will be subject to, under such transaction.
The DD is important to verify, among others, the regularity of the mining rights, environmental regularity of projects, especially if you have already had some activity in the area, get to know the superficiaries and the types of contract that already exists, judicial and administrative liabilities of the company object of acquisition, the existing corporate structure; already signed contracts etc. Such information can also be used to establish the standards to fix the business value, weighing up assets, liabilities, the potential of assets and their risks.
Another important analysis that may be included in the DD is to evaluate the stakeholders with whom the purchaser of certain assets will relate if he decides to purchase them. Understanding the perception of different plaintiffs and how they may influence the intensity and the licensing and operation of such projects can be crucial to the success of the deal.
Considering that Due Diligence involves the provision of strategic information on the assets under analysis, which also affect the competitiveness of the company holding mining rights, it is recommendable the prior formalization of contracts allowing access to such information, which will be followed by a chain of major contract and accessory agreements that best fit the business structure that one intends to conduct, taking into account, obviously, the investigation results.
SION ADVOGADOS, with technical and legal support, is at your disposal to support you in the identification of deposits, evaluation of assets and preparation of contracts, as well as providing advisory on the implementation and operation of mining projects.
Alexandre Oheb Sion
Roberta Paes Leme Bousas
Gabriel Guerra Duarte
SION, Alexandre Oheb; BOUSAS, Roberta Paes Leme: Bloqueio de áreas para fins de pesquisa e lavra de recursos minerais: um instrumento em benefício do setor mineral. Estudos de Direito Minerário, págs. 31-47, Editora Fórum, Belo Horizonte, 2012.