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Can the exploration rights be transferred during the retention period? New regulatory changes that mine owners must read
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Article author：Yingting Lawyers Group | Update time：1970-01-01 | Reading times：93
Foreword#p#Page title#e#
#p#Paging title#e#"My exploration rights are being reserved. There is a buyer who wants to acquire them. Can I transfer them?"#p#page title#e#
#p#Paging title#e#In practice, lawyer Ying Ting often encounters such inquiries. This is a very important issue that involves the core rules of the prospecting rights reservation system. #p#Paging title#e#
#p#Paging title#e#Today, we will talk in detail about the relationship between the retention and transfer of exploration rights. #p#Paging title#e#
#p#Paging title#e#The law clearly prohibits: The exploration right shall not be transferred during the period of retention #p# Pagination title #e#
#p#Paging title#e#Legal provisions#p#Page title#e#
#p#Paging title#e#Although the newly revised "Mineral Resources Law" in 2024 does not directly stipulate it, the "Implementation Regulations of the Mineral Resources Law" that will be implemented on June 15, 2026 clearly stipulates: #p#page title#e#
#p#Paging title#e##p#Paging title#e#"During the period of retention of the prospecting right, the holder of the prospecting right shall not transfer the prospecting right."#p#Page Title#e##p#Paging title#e#
#p#Paging title#e#This is a mandatory requirement#p#Paging title#e#
#p#Paging title#e#This is a #p#paging title#e#Mandatory provisions#p#Paging title#e#, without any exceptions: - ❌ cannot be transferred as a whole - ❌ cannot be transferred in part - ❌ cannot be transferred in disguised form through equity transfer - ❌ cannot be used for mortgage or pledge#p#page title#e#
#p#Paging title#e#Why can't it be transferred? #p#Paging title#e#
#p#Paging title#e#Legislative purpose#p#Page title#e#
#p#Paging title#e#The purpose of establishing the exploration rights retention system is to: - protect the legitimate rights and interests of the exploration rights holders - give the exploration rights holders "breathing" time - wait for the conditions to mature and convert them to mining rights#p#page title#e#
#p#Paging title#e#Reasons for prohibiting transfer#p#Paging title#e#
#p#Paging title#e#If transfers are allowed during the retention period, the following issues may arise:#p#Pagination Title#e#
#p#Paging title#e##p#Paging title#e#1. Risk of rights abuse#p#Page title#e#- Retention is to protect the rights and interests of the original exploration rights holder - Allowing transfer may lead to the rights being "resold" - It violates the original intention of establishing the system#p#page title#e#
#p#Paging title#e##p#Paging title#e#2. Transferee qualification issue#p#Page title#e#- The status of the rights during the retention period of the exploration rights is unstable - the transferee may not have the corresponding technical capabilities - it may cause the exploration work to be unable to continue#p#page title#e#
#p#Paging title#e##p#Paging title#e#3. Increase management difficulty#p#Paging title#e#- It is difficult for the competent authorities to track and manage - Supervision loopholes may occur - It is not conducive to the healthy development of the mining rights market#p#page title#e#
#p#Paging title#e#Isn't it also possible to transfer in disguised form? #p#Paging title#e#
#p#Paging title#e#Is equity transfer possible? #p#Paging title#e#
#p#Paging title#e#This is a "loophole" that many companies want to take advantage of. #p#Paging title#e#
#p#Paging title#e##p#Paging title#e#The answer is: No! #p#Paging title#e##p#Paging title#e#
#p#Paging title#e#The "Regulations on the Implementation of the Mineral Resources Law" clearly prohibits the "transfer of exploration rights." However, there are also risks in practice for indirect transfer of exploration rights by transferring the equity of the company holding the exploration rights: #p#page title#e#
#p#Paging title#e##p#Paging title#e#Risk 1: Violation of reporting obligations#p#page title#e##p#Paging title#e#
#p#Paging title#e#Article 27 of the "Mineral Resources Law" stipulates: "If the actual controller changes due to equity transfer, etc., the mining rights holder shall report to the original mining rights transfer department."#p#page title#e#
#p#Paging title#e#In other words, if the actual controller of the exploration rights changes due to equity transfer, it is necessary to report to the competent department#p#page title#e#Report#p#Page title#e#. #p#Paging title#e#
#p#Paging title#e##p#Paging title#e#Risk 2: Local policy restrictions#p#Page title#e##p#Paging title#e#
#p#Paging title#e#The natural resources authorities in some areas will manage the transfer of equity as a transfer of mining rights and may require approval procedures for the transfer of mining rights. #p#Paging title#e#
#p#Paging title#e##p#Paging title#e#Risk Three: Legal Dispute Risk#p#Page Title#e##p#Paging title#e#
#p#Paging title#e#If the exploration rights are transferred in disguised form in the name of equity transfer, it may: - be deemed invalid - face administrative penalties - contract disputes may arise #p#page title#e#
#p#Paging title#e#Is it possible to mortgage or pledge? #p#Paging title#e#
#p#Paging title#e##p#Paging title#e#Answer: No way! #p#Paging title#e##p#Paging title#e#
#p#Paging title#e#Exploration rights retention period: - ❌ Exploration rights shall not be used for mortgage - ❌ Exploration rights shall not be used for pledge - ❌ Other forms of guarantees shall not be made#p#page title#e#
#p#Paging title#e#Reasons: - The status of the rights is unstable during the retention period - It may damage the interests of the mortgagee/pledgee - Avoid disguised "transfer" through guarantee activities#p#page title#e#
#p#Paging title#e#What should I do if I want to transfer? #p#Paging title#e#
#p#Paging title#e#Option 1: Transfer mining rights first and then transfer #p#Page title#e#
#p#Paging title#e#If there is a buyer who wants to acquire the exploration rights during the period of retention, it is recommended: #p#page title#e#
#p#Paging title#e##p#Paging title#e#Advantages: #p#Paging title#e#- Mining rights can be transferred in accordance with the law - Rights status is stable - Legal risks are small #p#page title#e#
#p#Paging title#e#Option 2: Transfer after the retention period expires#p#Page title#e#
#p#Paging title#e#If it is indeed impossible to transfer the mining rights during the retention period, you can: #p#Page Title#e#
#p#Paging title#e##p#Paging title#e#Note: #p#Paging title#e#- Renewal requires a reduction in exploration area - Normal exploration work needs to be carried out after renewal - Transfer still needs to meet legal conditions#p#page title#e#
#p#Paging title#e#Option 3: Cooperative development#p#Paging title#e#
#p#Paging title#e#If you want to cash out but cannot transfer directly, you can consider: #p#Page Title#e#
#p#Paging title#e##p#Paging title#e#Note: #p#Paging title#e#- You also need to be cautious in cooperative development - You cannot transfer exploration rights in disguise - It is recommended to consult a professional lawyer to design a cooperation plan#p#page title#e#
#p#Paging title#e#Legal consequences of illegal transfer#p#Page title#e#
#p#Paging title#e#Administrative penalty#p#Page title#e#
#p#Paging title#e#If you transfer the exploration rights without authorization during the period of retention of the exploration rights: - the transfer may be invalid - you will face administrative penalties - your exploration license may be revoked#p#page title#e#
#p#Paging title#e#Contract dispute#p#Page title#e#
#p#Paging title#e#If violations are discovered after signing the transfer contract: - the contract may be deemed invalid - the buyer may demand refund compensation - both parties may be harmed#p#page title#e#
#p#Paging title#e#Civil compensation#p#Page title#e#
#p#Paging title#e#Possible losses caused by illegal transfers: - Refund of transfer money - Compensation for the other party's losses - Bearing liability for breach of contract#p#page title#e#
#p#Paging title#e#Lawyer Ying Ting suggested #p# pagination title #e#
#p#Paging title#e#Lawyer Liu Jingzhu of Beijing Yingting Law Firm specially reminds: #p#Page title#e#
#p#Paging title#e##p#Paging title#e#During the retention period, the exploration rights cannot be transferred! #p#Paging title#e##p#Paging title#e#
#p#Paging title#e##p#Paging title#e#This is the red line, don't touch it! #p#Paging title#e##p#Paging title#e#
#p#Paging title#e#If you want to transfer, it is recommended to do this: #p#Paging title#e#
#p#Paging title#e##p#Paging title#e#
#p#Paging title#e#Warm reminder: This content is for reference only and does not constitute legal advice. Please consult a professional attorney for specific questions. #p#Paging title#e##p#Paging title#e#
#p#Paging title#e#Previous article：The prospecting rights have hit the ecological red line. Can retaining them still save lives?
Next article：How to apply for retaining exploration rights? Teach you step by step the entire process
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