Murilo Melo Vale[1]
The State of Minas Gerais is an important Brazilian player in the mining sector and is one of the main players in the world. Next to State of Pará, Brazil, Minas Gerais is the states that export the most iron ore in the country and is Brazil's largest producer of zinc, gold, phosphate, graphite, lithium and limestone. Not only that. This state is responsible for 75% of the extraction of all niobium from planet Earth.
The importance of the sector for this State is, therefore, easy to conceive, since it contributes to the creation of several jobs and to increase the public revenue for the State and mining municipalities. According to the Brazilian Ministry of Labor, in 2020, the State of Minas Gerais was the leader in the generation of number of mining enterprises in Brazil with 1,776 extractive companies and jobs in this sector, with 64,900 direct new employees.
On the other hand, it is well known that mining is an enterprise with a huge impact and numerous environmental and social issues. In State of Minas Gerais, unfortunately, irreparable tragedies have been experienced with the rupture of mining tailings dams – cases of the Samarco´s tragedy in the Municipality of Mariana, and Vale´s tragedy in the Municipality of Brumadinho – whose scars makes the issue of mining expansion a very sensitive problem.
In this context, the Brazilian Constitution emphasizes the duty of government to promote the development of extraction´s activities of non-renewable mineral resources. This is because the Constitution categorizes research and mining of mineral resources as a matter of “national interest” (article 176, paragraph 1). Mineral resources belong, therefore, to the Brazilian people, who have the right to expand their exploration, not being relegated to mere individual interests.
Numerous legal provisions in the Brazilian legal system make this clear, especially considering that the mineral resource is a public asset of the Federal Government, which monetizes its extraction through the collection of royalties and other financial revenues arising from the billing of mining enterprises. Furthermore, no landowner can oppose the collective interest of mineral extraction, so much so that the public power has the prerogative to establish the public utility of the sites inherent to this activity, supported by the thesis of imminent dominion.
Given this, and under the determination of the Court of Auditors of State of Minas Gerais (Judgment of Operational Audit No. 951,431), the State of Minas Gerais is carrying out a state mining plan, in other words, a government planning instrument that points to the future of mining in this State, ensuring mineral extraction in accordance with the imperatives of environmental protection and social and environmental sustainability.
It was possible to verify the following fundamental themes that the future of mining will have to permeate, which have been discussed in workshops held publicly within the scope of this project:
(i) Promotion of mining activity. The State has the duty in the promotion and encouragement of mining activities, especially by small miners, based on the constitutional obligations of ensuring national development, support for small enterprises and the use of regulatory instruments to encourage and plan the economy. Only the increase in mining activity can be aligned with the goals of mineral extraction, which is the public use of the financial benefits arising from mining activity.
(ii) Economic dynamization of mining municipalities. The State, like every nation, has the relevant public interest in ensuring that the mining municipalities do not become hostage to the large mining companies, which have a period of permanence in the locality, due to the simple fact that the mineral resource under exploration is exhaustible. In this sense, the legal system stipulates that the public revenues earned through mining exploration in their territories, specifically the Financial Compensation for the Exploration of Mineral Resources ("CFEM"), must be applied in policies of economic dynamization of the municipality.
With policies aimed at economic dynamization, it is intended that the Municipality can encourage – with revenue from mining – other activities that do not depend on mining, in order to create a business environment that is more liable to emancipate itself economically and reduce the dependence of large mining companies, whose effects transcend the singular municipal interest. In this sense, the State can provide inspection mechanisms to prevent misappropriation and deviations in the correct application of these public resources.
(iii) Prevention or mitigation of environmental damage in the development of mining activity. According to the Brazilian Constitution, the duty of environmental protection is relegated to all federal entities and the State has a great responsibility in safeguarding the damage and environmental impact caused by mining, because it holds the general competence of licensing of enterprises that cause environmental degradation, in cases that are not of municipal and federal competence. In this aspect, seeking actions to promote the protection of the environment, in harmony with the interest of development of mining activity, is something that the State has great prerogative.
(iv) Provision of sustainability measures, including those related to the mitigation of greenhouse gas emissions. In harmony with several countries committed to the reduction of greenhouse gases, Brazil, nationally, has made an international commitment to carry out mitigation measures, conceptualized as "Technological changes and substitutions that reduce the use of resources and emissions per unit of production, as well as the implementation of measures that reduce greenhouse gas emissions […]." (art. 2, VII, of Law no. 12.187/2009). In this sense, it is the duty of the State to promote public awareness of good environmental practices, which induce in the reduction of the impact of mining activity, especially in the worsening of greenhouse gas reduction indicators..
(v) Safety of mining tailings dams. The State has a fundamental role in supervising the execution of the best methods of construction and operation of mining tailings dams, according to duties inherent to the environmental protection, as well as pertinent to civil defense competences. It is not necessary remember the environmental and social disasters resulting from the rupture of dams in the State of Minas Gerais, to place this theme as central in the definition of the planning of government actions pertinent to mining.
(vi) Instruments and policies aimed at technological innovation of interest to the mining sector. The sum of efforts arising from the duty to promoting innovation (article 218, caput, and §5, of the Brazilian Constitution), in the scope of mining enterprises, research, development and innovation can mean an important element for the sustainable and healthy promotion of mining activity. The encouragement of research involving instruments and measures that may lead to a more sustainable mining should therefore be important role of the state government, since it is a logical corollary of all the previous competences.
(vii) Improvement of institutional governance. In all state planning, it is essential to understand the parameters for the effectiveness of a government measure and the relationship mechanisms with other entities that are stakeholders of government actions. This is a principle arising from administrative efficiency, which must take place in state actions (article 37 of the Brazilian Constitution). Therefore, the planning of government actions directed to mining has to seek to improve the forms of relationship with the local entity (mining municipality), as well as with the regulatory entity of the mining sector (Federal Government), so that proposed solutions are not only in the plane of ideas.
With due attention to these pillars proposed under the state mining plan in progress, it is possible to say that the State of Minas Gerais is on the right track of a new era of growth of mining activity, in an environmentally friendly way and in tune with the social responsibility arising from the impacts that this activity generates, by its own nature.
[1] Murilo Melo Vale Attorney. Partner at Tavernard Advogados and Head of the Public Law area. Murilo hols a Doctor (PhD) and Master (M.sc) in Public Law. Postgraduate in Public Law. Coordinator of regulatory affairs for the state mining plan. Vice-President of the Minas Gerais Association of Law and Economics. Professor of Public Law at different institutions.