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Kyrgyzstan approves new charge rates for retention of licenses for subsoil use

The procedure for calculating, paying and collecting the arrears in the charge for the retention of licenses for the right to use subsoil has been approved in Kyrgyzstan. The corresponding decision was signed by the Chairman of the Cabinet of Ministers Ulukbek Maripov.

It is noted that the decision is aimed at meeting the national interests in the field of subsoil use and improving the legislative regulation of fees for retention of a license. An analysis of the activities of small and medium-sized companies-subsoil users showed that the main purpose of the introduction of the charge for retention of a license is to motivate companies to develop and launch production. But it has been achieved only partially.

Most licenses are held for resale.

Only 250 licenses out of 769 (35 percent) are used for mining operations. At the same time, until 2013, the legislation in the field of subsoil use provided for an administrative lever — a specialized state body could revoke a license, if certain works were not carried out. From 2015, economic leverage began to be applied — a license retention fee was introduced.

From 2013 to 2021, 2.4 billion soms were transferred to local budgets in form of license retention fees.

Annual payments range from 250 to 377 million soms. However, practice has shown that the initially established rates of the license retention fee did not contribute to an early start of production or a reduction in licensed areas. Therefore, it became necessary to revise them.

«When new charge rates are set, companies that hold licenses for resale will be forced to either carry out mining and geological works, or refuse licenses, which can subsequently attract investments,» the statement says.

The decision comes into force on the expiry of 15 days after the date of official publication.

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