Model of Mining Contract

Timor-Leste adopts Concession Regimes for its mineral sector. Mineral Rights Holder(s) carry-out exploration, development, production, processing, transportation, and marketing at its sole risks.

Timor-Leste Minerals Fiscal Regime

Royalties (as set out in Annex II of Law No. 12/2021, Mining Code)
Mineral classification (as set out in Article 5) Value of Raw Minerals Value of Processed Minerals
a. Metallic Minerals
 (i) Precious metals / minerals 8 % 3.5 %
 (ii) Base Metals 7 % 2.5 %
b. Gemstones 8 % 3.5 %
c. Radioactive Minerals 8 %
d. Industrial Minerals
(i) Process Materials
      a. Process materials in the form other than stones 8 % 2.5  %
      b. Process materials in form of stones USD $ 7.00/t USD $ 1.00/t
(ii) Ornamental stones USD $ 10.00/t USD $ 1.00/t
(iii) Construction Materials
       a. For domestic use USD $ 3 – 10 / m3 n/a
       b. For exports USD $ 10 – 15 / m3 n/a
e. Rare Earth Element 15 %
f. Coal 5% n/a
Surface Fees (as set out in Annex III of Law No. 12/2021, Mining Code)
1.     During the Exploration and Evaluation Period and the Development Period Mineral classification (a), (c) & (f) Mineral classification (b), (d), & (e)
Period 1 1-3 years USD $ 50 / km2 USD $ 25 / km2
Period 2 4-5 years USD $ 100 / km2 USD $ 50 / km2
Period 3 6-7 years USD $ 200 / km2 USD $ 100 / km2
2.     During the Mining Period Mineral classification (a), (c) & (f) Mineral classification (b), (d) & (e)
Period 1 1-5 years USD $ 50 / km2 USD $ 50/ km2
Period 2 6-15 years USD $ 150 / km2 USD $ 100 / km2
Period 3 16-25 years USD $ 250 / km2 USD $ 150 / km2
Period 4 Over 25 years USD $ 400 / km2 USD $ 200 / km2
Taxation
Corporate Income Tax 10 %
Import Duties 5 %
Service Tax for Mining 4.5 %
Payroll Tax 10 %
Tax on Dividend 10 %
Sales Tax on Import Goods 2.5 %

The Model Mining Contract can be accessed from:

Part IV of Government Resolution No. 7/2023

(Click here to download)

English version of the Mining Contract Model

and Exploration and Evaluation License

(Click here to download)