The CIMG, through its members, has collated this paper which illustrates some of the issues affecting international mining companies in China today. It has been close to thirty years since China opened its doors to foreign investors and spectacular progress has been made in some sectors such as the manufacturing industry. Unfortunately, such progress has yet to be achieved in the mining sector where there are as yet few large mining projects operated as Sino-foreign joint ventures, or as wholly owned enterprises. Notwithstanding the above, the CIMG commend the respective authorities for the efforts in reforming the current Mineral Law, but would like to stress that there are still a number of issues that restrain China from being a preferred destination for international mining investment.

We believe that these issues heavily restrict foreign investment in this sector and thus affect well known direct benefits to China such as tax revenue, technology transfer and more. The issues highlight the difficulties encountered in relation to conducting exploration and mining in China. The common theme is that the Chinese rules and regulations present many barriers to foreign investment which are not present for a foreign investor in other jurisdictions.
The issues/barriers perceived to impede foreign investment into the Chinese mining sector that are covered in this paper are related to: 

• Open Ground/Bidding 
• Security of Title 
• Valuation of Exploration/Mining Assets 
• The Qualification to Explore 
• National Treatment - Irregular application of the law between National and Provincial departments 
• Access to Geological Information 
• Vague project approval process and Fair competition/procurement 
• Tax treatment of foreign mining companies in China 
• Corporate structures 
• Foreign Investment Guidelines

The CIMG would like to state that by addressing these issues the mining sector would provide socio-economic benefits that are common with increased levels of foreign investment.

	CIMG White Paper 2006