DOF, NCIP Sign Data Sharing Pact to Ensure Transparency in Mining Royalties

The Department of Finance’s (DOF) Philippine Extractive Industries Transparency Initiative (PH-EITI) and the National Commission on Indigenous Peoples (NCIP) have signed a memorandum of understanding (MOU) to enhance transparency in royalties paid by mining firms to indigenous communities.

Ensuring Fair Compensation for IP Communities

The agreement aims to improve the recording and monitoring of payments made by mining companies, ensuring that host Indigenous Peoples (IP) communities receive their rightful share.

“We estimate that royalties paid to IP communities from 2013 to 2022 reached around ₱100 billion, but we believe the figure is understated,” said PH-EITI National Coordinator Mary Ann Rodolfo.

DOF Undersecretary Bayani Agabin echoed this sentiment, stating that the actual amount could be much higher. The data-sharing agreement will provide a clearer picture of how much royalties should be distributed.

Legal Framework for Mining Royalties

Under the Philippine Mining Act of 1995, mining firms must:
📌 Obtain consent from IP communities before operating in their territories.
📌 Negotiate royalty payments with host communities, facilitated by the NCIP.
📌 Provide at least 1% of the gross market value of extracted minerals as royalties.

NCIP Chairperson Jennifer Pia Sibug-Las emphasized that the MOU will empower indigenous groups by granting them direct access to royalty data, ensuring fair distribution among community members.

Boosting Investor Confidence in Philippine Mining

The agreement is also expected to increase transparency and improve the country’s investment climate.

“Foreign investors look at governance structures when entering a country. Transparency in royalty payments will strengthen investor confidence in the mining sector,” Agabin said.

Additionally, the proposed mining fiscal reform bill includes provisions to institutionalize transparency as part of the industry’s long-term development strategy.