Zambia has taken a step in modernizing its mining regulatory landscape through the enactment of the Minerals Regulation Commission Act, 2024 (“MRC Act”), which repeals the Mines and Minerals Development Act, 2015. The MRC Act consolidates oversight into a single, autonomous regulator – the Minerals Regulation Commission (“MRC”) – and for investors, the MRC Act signals a shift towards a more structured, centralised, and compliance-driven environment. Below are key updates, their implications, and practical recommendations.

1. A single, independent regulator

The MRC replaces the fragmented oversight previously carried out by multiple Directors and the Minister of Mines under the Ministry of Mines and Mineral Development. The MRC now has broad powers to:

• Grant, suspend, and revoke mining and non-mining rights;
• Approve transfers and encumbrances of mining rights and changes of control in mining right  holders;
• Audit environmental performance in collaboration with the Zambia Environmental Management Agency (“ZEMA”); and
• Regulate mineral marketing and valuation.

Investor Takeaway: Centralisation should reduce procedural delays but also means more coordinated inspections and potentially stricter enforcement. Maintain transparent engagement with the MRC and ensure all corporate actions involving placing of encumbrances and ownership or control changes are pre-cleared.

2. Tighter eligibility criteria

Beyond corporate registration in Zambia, applicants must now:

• Possess valid tax clearance certificates;
• Meet the thresholds set for reservation of rights for citizen-controlled companies for licence areas up to 1,000 hectares; and
• Comply with new limits on the number of mining rights (maximum of five mining rights, unless financially and operationally justified).

Investor Takeaway: Conduct internal compliance audits before applications or renewals. Foreign investors should structure partnerships with citizen-owned companies for smaller concessions and ensure tax compliance is evident.

3. Environmental liability and progressive rehabilitation

The MRC Act strengthens environmental accountability by:

• Embedding ESG considerations in licensing decisions;
• Mandating environmental budget monitoring and joint audits with ZEMA;
• Requiring progressive rehabilitation and mine closure planning throughout a project’s lifecycle;
• Retaining the Environmental Protection Fund as financial security for environmental obligations.

Under Section 65 of the MRC Act, liability for environmental harm extends to not only the licence holder but potentially directors or officers of the company where they are found to have directly contributed to environmental breaches.
Investor Takeaway: Treat environmental compliance as a board-level responsibility. Ensure directors and senior management are trained on ESG obligations and that environmental risk registers are actively managed.

4. Enhanced corporate and shareholder accountability

The MRC Act recognizes offences by corporate bodies now expressly making it possible to hold:

• The company;
• Its directors; and/or
• Shareholders.

Liable for offences under the MRC Act where the offence is committed with the knowledge of that director, manager, shareholder or partner of the body corporate. 
Investor Takeaway: Strengthen corporate governance frameworks, adopt whistleblowing mechanisms, and ensure board oversight of compliance functions.

5. Operational compliance and enforcement

The MRC’s inspectorate operates with:

• Expanded powers to seize property where there is reason to believe that an offence has been committed; and
• Authority to issue compliance orders.

Investor Takeaway: Establish site-level compliance officers and maintain meticulous records. Regularly self-audit against license conditions.

6. Dispute resolution

Although it has not yet been operationalised, the Mining Appeals Tribunal remains in place as a means of dispute resolution for mining related disputes. Alternative dispute resolution is also provided for surface rights disputes.
Investor Takeaway: Ensure contractual dispute resolution clauses are aligned with statutory mechanisms.

Practical recommendations for investors

The following are a summary of the recommendations for investors based on the provisions of the MRC Act:

1. Early Regulatory Engagement: Meet with the MRC prior to applications, transfers, or restructurings;
2. Governance Alignment: Align internal governance, shareholder agreements, and board practices with the MRC Act’s accountability provisions;
3. ESG Integration: Implement environmental management systems with real-time monitoring; document rehabilitation efforts;
4. Tax and Legal Compliance: Maintain up-to-date tax clearance and corporate records;
5. Risk Allocation in Contracts: Include indemnities and warranties in Joint Venture and investment agreements covering environmental and compliance breaches; and
6. Training and Awareness: Conduct regular compliance training for management and site supervisors.

Conclusion

The MRC Act represents a decisive move towards a compliance-focused mining sector in Zambia. While it introduces new obligations and potential liabilities – including for shareholders – it also provides a clearer, more centralised framework for investors. Those who proactively adapt governance structures, embed ESG practices, and maintain active regulatory relationships will be best placed to thrive under the new regime. For tailored advice or a compliance audit under the MRC Act, please contact me at [email protected].