Mining industry


What is the nature and importance of the mining industry in your country?

Finland is one of the leading mining countries in Europe and the mining industry plays an important economic role in Finland, along with its future growth potential. Finland has the right geology and a long mining tradition. Mining activity in Finland is currently concentrated around gold, platinum group metals, base metals, diamonds and industrial minerals. Most exploration companies operating in Finland search for gold either primarily or secondarily.

Finland offers an attractive investment and operating environment for the exploration and mining industry. There is potential for new discoveries because there are commodities that are currently explored on a small scale or not at all. In contrast to many other countries, Finland also has many high-class geological databases available on the internet. The infrastructure is good, even in rural areas, and there are skilled subcontractors available. Also, the public sector provides many services for the mining industry that would, in other countries, incur large costs.

Finland’s mining production has doubled during the past decade and the growth has been especially fast in recent years, albeit the downturn in commodity prices has negatively impacted the local mining and exploration industry. In 2018, the total amount extracted from Finnish mines grew to 130.1 million tonnes, of which 49 million tonnes constituted ore or usable minerals according to the report of the mining authority, the Finnish Safety and Chemicals Agency (TUKES). Out of the 46 mines in Finland, 24 are reported to have quarried in 2018. Three of the biggest mines account for 84 per cent of all quarried minerals. In 2018, Finnish mines invested 29 per cent more than in the previous year, making the combined investments worth €390 million.

In all, the entire Finnish mineral cluster (including the technology and service providers) provides employment for some 30,000 people.

Target minerals

What are the target minerals?

The target minerals are as follows:


Mining productionin Finland

Discovery potential in Finland


No deposits

Low discovery potential



Moderate discovery potential


No deposits

Moderate discovery potential


No deposits

Low discovery potential


No deposits

Moderate discovery potential


No deposits

Low discovery potential


Mining production

Good discovery potential

Clay minerals


Moderate discovery potential


Mining production

Good discovery potential


Mining production

Good discovery potential


No deposits

Low discovery potential


Mining production

Good discovery potential


No deposits

Low discovery potential


Mining productionin Finland

Discovery potential in Finland


No deposits

Low discovery potential


No deposits

Low discovery potential


Mining projects



No deposits

Moderate discovery potential


No deposits

Low discovery potential


No deposits

Moderate discovery potential


Mining projects

Moderate discovery potential


Mining production

Good discovery potential


Mining projects

Good discovery potential


No deposits

Moderate discovery potential


No deposits

Low discovery potential


Mining projects

Moderate discovery potential



Moderate discovery potential


Mining production

Good discovery potential


Mining projects

Good discovery potential


No deposits

Low discovery potential

Platinum group metals

Mining projects

Good discovery potential

Precious stones




Mining production

Good discovery potential

Rare earth metals


Good discovery potential


No deposits

Low discovery potential


Mining projects

Moderate discovery potential

Soap stones

Mining projects



Mining production

Good discovery potential



Moderate discovery potential



Good discovery potential


Mining projects

Good discovery potential



Moderate discovery potential

Uranium and thorium




Mining projects

Good discovery potential


Mining production

Good discovery potential


Which regions are most active?

Northern and eastern Finland are the most active regions, although ore bodies are also found in other parts of the country.

Legal and regulatory structure

Basis of legal system

Is the legal system civil or common law-based?

Finland’s legal system is civil law-based.


How is the mining industry regulated?

In Finland, national and EU laws regulate the entire country, although the Åland Islands are exempt in some aspects, given their right of self-government. There are mining and other laws in force that regulate the mining industry.

What are the principal laws that regulate the mining industry? What are the principal regulatory bodies that administer those laws? Were there any major amendments in the past year?

There is a special mining law in force, namely the Mining Act, which entered into force on 1 July 2011. The Mining Act (621/2011) takes account of other key legislation applicable to exploration and mining activity, including:

  • the Nature Conservation Act;
  • the Environmental Protection Act;
  • the Act on the Protection of Wilderness Reserves;
  • the Land Use and Building Act;
  • the Water Act;
  • the Reindeer Husbandry Act;
  • the Radiation Act;
  • the Nuclear Energy Act;
  • the Antiquities Act;
  • the Off-Road Traffic Act;
  • the Dam Safety Act; and
  • the Occupational Safety and Health Act.

Several government decrees have been issued based on the Mining Act such as:

  • the Mining Decree;
  • the Government Decree on Mine Safety; and
  • the Decree of the Ministry of Employment and the Economy on Hosting Equipment in Mines.

All laws operate at the national level.

The most important government body for the mining industry is TUKES, which acts as the mining authority. TUKES is responsible for granting permits and supervising and enforcing compliance with the Mining Act. TUKES’ decisions can be appealed to the administrative courts. The Ministry of Employment and the Economy is responsible for the general guidance, monitoring and development of activities under the Mining Act.

On the environmental side, the environmental permit required for mining is granted by the competent regional state administrative agency (AVI), whereas the centres for economic development, transport and the environment (ELY centres) manage the regional implementation and development tasks of the state administration.

ELY centres supervise decisions with respect to environmental and water permits issued by AVIs and protect the public interest in environmental and water issues. Activities that require an environmental permit, such as mining projects, are supervised throughout their lifetime. ELY centres also act as contact authorities in environmental impact assessment procedures.

Local municipalities are responsible for their own detailed planning and are also the authorities granting building permits.

Finally, in any matters that relate to radioactive substances, the Radiation and Nuclear Safety Authority of Finland (STUK) is the key authority involved. STUK belongs to the administration of the Ministry of Social Affairs and Health.

Effective as of 1 January 2016, the Mining Act was amended so that the right to appeal the mining authority’s decisions all the way through to the Supreme Administrative Court is restricted. The possibility to appeal against decisions rendered by the mining authority first to the administrative court and then to the Supreme Administrative Court was, until the end of the year 2015, unrestricted. Since the amendment appealing the decisions of the administrative courts to the Supreme Administrative Court has, in most cases, only been possible if a retrial permit is granted. The amendment is related to a broader legislative reform aimed at enhancing and accelerating the handling of administrative decisions made by the Finnish authorities. The retrial permit procedure is applied only to such decisions of the mining authority that are rendered on or after 1 January 2016.

The revision of the Environmental Protection Act has lately been subject to its third and last phase of amendments. The third phase of amendments concerned streamlining environmental permitting.

The Mining Act was subject to reforms on 1 June 2017 relating, among other things, to the following:

  • the removal of the 1km exclusion zone (competing permits) applied to reservation notifications;
  • shortening the waiting period (probation period) relating to previous exploration or mining permit areas that have being relinquished or lapsed from three years to two;
  • the relinquishment of exploration permits (which was deregulated so that the obligation to pay exploration fees ceased to exist as soon as TUKES is notified in writing of the permit holder’s intention to relinquish the exploration permit). Furthermore, landowners would no longer be able to appeal from the relinquishment decisions initiated by the permit holder; and
  • when an operating mine is extended with a new mining area or auxiliary area, the mining safety permit procedures are simplified or updates may not be required at all.
Classification system

What classification system does the mining industry use for reporting mineral resources and mineral reserves?

Mainly the Canadian Institute of Mining and Australian Joint Ore Reserves Committee systems.

Mining rights and title

State control over mining rights

To what extent does the state control mining rights in your jurisdiction? Can those rights be granted to private parties and to what extent will they have title to minerals in the ground? Are there large areas where the mining rights are held privately or which belong to the owner of the surface rights? Is there a separate legal regime or process for third parties to obtain mining rights in those areas?

Finland has a system according to which the discoverer can acquire the rights to the minerals in the ground even if the surface rights are held by the state or a third party. TUKES registers reservations for areas on which exploration permits can be filed and issues exploration and mining permits subject to the legal requirements being met. Currently, less than 1 per cent of the total area of Finland is subject to mining permits.


It is possible for private parties to engage in exploration in the form of prospecting work without a permit on areas where the surface rights are held by someone else (private or state). This right is comparable with rights of public access. It is also possible to carry out exploration without an exploration permit but with a landowner’s permit; however, this does not give any priority to acquiring the exploration or mining permit for the target area.

An exploration permit, granted by TUKES, is always required if the activity poses any risk to people’s health, general safety or other industrial and commercial activity, or any deterioration of the landscape or nature conservation. Without exception, an exploration permit is required if the prospecting is targeted for locating or exploring a deposit containing uranium or thorium.

The exploration and mining rights can be acquired by private parties. A reservation followed by an exploration or mining permit, or both, gives the priority and title to the minerals in the target area.

There are increasing numbers of reservations, exploration permit areas and mining permit areas but there are still large areas with good or moderate discovery potential available for interested parties.


A mining permit gives the right to develop a mine and to carry out mining activities. The holder of a mining permit has the right to exploit mining minerals found in the mining area, organic and inorganic surface materials, waste rock and tailings generated as by-products of mining activities. In addition, the holder may exploit other materials belonging to the bedrock and soil of the mining area to the extent that their use is necessary for the purposes of mining operations in the mining area. The mining permit also entitles its holder to exploration within the mining area. The procedures for establishing a mining area involve the claiming of rights to land use and of other special rights to the areas required for the mining area and auxiliary area of a mine, the determination of compensation and the conducting of required measures of land subdivision.

The decision to grant a mining permit is based on a comprehensive approach, on the one hand, taking account of the needs of prospecting and mining, and on the other hand, considering factors such as the status of landowners and private parties sustaining damage. Moreover, the impact of activities on the environment, landscape, land use and safety, the economic use of natural resources and nature conservation, radiation safety and the reconciliation of user needs in different areas need to be taken into account.

Often, the mining company acquires the title (surface rights) to the land through voluntary acquisitions. Should this not be the case, the government may grant a permit to utilise an area for mining even though the surface rights are held by someone else (redemption permit for a mining area). The formal prerequisite for this is that the mining project is in the public interest.

Publicly available information and data

What information and data are publicly available to private parties that wish to engage in exploration and other mining activities? Is there an agency which collects mineral assessment reports from private parties? Must private parties file mineral assessment reports? Does the agency or the government conduct geoscience surveys, which become part of the database? Is the database available online?

The Geological Survey of Finland (GTK) is the national geological organisation as well as the national geoscience centre responsible for collecting and maintaining geoscientific data in Finland. The GTK’s key activities are the mapping and evaluation of natural resources and research and development. In addition to national mapping and geosciences information related to bedrock geology, geophysics, geochemistry and mineral occurrences, the GTK evaluates the ore potential of geological formations to encourage further evaluation by the private sector. All discoveries are tendered to the private sector through the Ministry of Employment and the Economy, and the government has no role in the downstream development of the mineral deposits.

The GTK’s databases cover the entire country with exceptional detail and include:

  • high-resolution, low-altitude airborne geophysical surveys (to a 40-metre altitude, with 200-metre line spacing);
  • regional till geochemical sampling (one sample per 4km2);
  • in-bedrock mapping at a 1:100,000 scale; and
  • quaternary geology mapping at a 1:20,000 scale.

Data sets are available in digital geographic information systems form and selected ones are viewable on the GTK’s active map explorer web page (see: This web service provides up-to-date information on land tenure, exploration reports, drilling, mines and undeveloped deposits, mineral indications data and bedrock age data in Finland.

The holder of an exploration permit must submit an annual report to TUKES on the exploration activities that have been carried out and their main results. The report must be submitted in electronic format on the template provided by TUKES. The annual report is divided into two parts, of which part 1 (costs and investments) must be delivered to TUKES during February or March and part 2 (geological surveys) by June in any given year.

Once an exploration permit has expired or been cancelled, the exploration permit holder must, within six months, submit to TUKES an exploration work report, the material information pertaining to the exploration and a representative set of drill-core samples. The drill-core samples are eventually reposited at the GTK’s drill-core archive.

Acquisition of rights by private parties

What mining rights may private parties acquire? How are these acquired? What obligations does the rights holder have? If exploration or reconnaissance licences are granted, does such tenure give the holder an automatic or preferential right to acquire a mining licence? What are the requirements to convert to a mining licence?

Right to carry out prospecting work

In Finland, based on the principle of public access, everyone has the right, even on another’s land, to conduct geological measurements, make observations and take minor samples in order to find mining minerals, provided that this causes no damage or minor inconvenience or disturbance (prospecting work). There are, however, some limitations related to restricted areas.

Prior to sampling commencement, the person or company has to submit a notification to the real estate owner in the prospecting area that contains details of the prospecting area, methods used and targeted mining minerals, as well as other information set out in the Mining Act.

A private party may make a reservation notification and acquire an exploration or mining permit on a first-come, first-served basis. Exploration or mining permits are granted if the applicant proves that the conditions set out in the Mining Act are met and there is no impediment stipulated in the Mining Act to the granting of the permit. However, regardless of an impediment specified in the Mining Act, a permit may be granted if it is possible to remove said impediment through permit conditions or by decreasing the size of the area.


The reservation notification is filed in written form with TUKES. The notification must include information on the notifier, the target area (reservation area) and a compilation of an exploration plan and other measures in preparation for the exploration permit application.

The reservation notification may not concern an area that forms part of an exploration area, mining area, or gold panning area, belonging to a party other than the applicant on the basis of a permit referred to in the Mining Act. In addition, the reservation notification cannot concern an area that has previously been a reservation area until one year has passed since the expiry or cancellation of the reservation decision.

The reservation gives priority to get an exploration permit and is valid for a maximum period of 24 months, within which time an exploration permit application must be filed or the reservation will expire. Should the reservation permit holder carry out small-scale prospecting work, the holder has to give prior notice of prospecting to the landowner of the prospecting area as mentioned above. A reservation does not entitle to exploration unless the landowner in question gives his or her permit. A reservation cannot be assigned to another party.

Exploration permit

Exploration permits are granted on a first-to-file basis by TUKES, taking into account that a reservation gives priority. Mining permits for uranium and thorium are granted by the Finnish government.

Simply, if exploration cannot be carried out as per the above-mentioned prospecting work and the property owner does not consent to exploration, a permit granted by TUKES (exploration permit) is needed. An exploration permit is also required if the exploration:

  • could cause harm to people’s health or general safety;
  • damage to other industrial and commercial activity; or
  • there is any further deterioration in value related to the landscape or nature protection values.

Further, an exploration permit is required if the targeted minerals are uranium or thorium.

The application for a permit must include reliable information on the applicant meeting the prerequisites for carrying out operations commensurate with the following:

  • the permit sought;
  • the area and parties concerned;
  • a preliminary assessment of the mining minerals in the area, and the basis for such an assessment;
  • plans concerning the activities;
  • the environmental and other impacts of activities; and
  • aftercare measures.

The exploration permit also includes provisions on the following (among others):

  • the times and methods of exploration surveys and the equipment and constructions used;
  • measures to diminish harm caused to reindeer herding in a special reindeer herding area;
  • an obligation to report exploration activities and their results;
  • post-exploration measures;
  • the waste management plan for extractive waste; and
  • collateral securing the post-exploration measures.

The holder of an exploration permit has an obligation to carry out prospecting or a survey. TUKES can decide that an exploration permit will expire if operations have been interrupted continuously for a minimum of one year for a reason given by the permit holder. The person who, in connection with the exploration, intends to damage or cut down trees has to inform the landowner in advance. Damage and harm arising from exploration has to be compensated in full. The exploration permit holder must pay an exploration fee (see also question 19) and compensate landowners or owners of the water areas for all damage and harm caused to them. The exploration permit holder must deliver to the mining authority a detailed annual report on the exploration work carried out in the permit area. After the termination or expiry of the exploration permit, the permit holder must immediately restore the exploration area to the condition required by public safety, remove temporary constructions and equipment, attend to the rehabilitation and tidying of the area and restore the area to its natural status as far as possible. The permit holder must also submit to the mining authority, within six months, an exploration work report, the information material pertaining to the exploration and a representative set of core samples accompanied by the drill logs.

Mining permit

Like exploration permits, mining permits are also granted on a first-to-file basis by TUKES. However, an exploration permit holder has priority to the mining permit in respect of the same area. Mining permits for uranium and thorium are granted by the Finnish government.

The establishment of a mine and undertaking mining activity are subject to a mining permit granted by TUKES. Even when the mining permit application relates to an area for which an exploration permit has been granted, the mining permit is a new permit and subject to new scrutiny of the project on its merits. The prerequisites for getting a mining permit are that the deposit is exploitable in terms of size, ore content and technical characteristics.

A mining permit entitles the holder to exploit the mining minerals found in the mining area, the organic and inorganic surface materials, excess rock, and tailings generated as a by-product of mining activities and other materials belonging to the bedrock and soil of the mining area to the extent that the use of these is necessary for the purposes of mining operations. The mining permit also entitles the holder to carry out exploration within the mining area.

The mining permit holder is obliged to ensure the following:

  • that the mining activities do not cause damage to people’s health or danger to public safety;
  • that mining activities do not cause significant harm to public or private interests;
  • that they reasonably avoid the infringement of public or private interests in relation to the overall costs of the mining operations;
  • that excavation and exploitation do not entail obvious wasting of mining minerals; and
  • that potential future use and excavation work at the mine and deposit are not endangered or encumbered.

The mining permit holder is obliged to submit an annual report to the mining authority on the extent and results of the exploitation of the deposit and to inform of any essential changes in the information on mineral resources.

In the mining permit, TUKES sets a time limit during which the permit holder has to start the mining activity or such preparatory work that indicates that the permit holder is seriously aiming at actual mining operations. If the time limit is forfeited, TUKES may decide that the mining permit should expire.

Finally, when the mining activities have ended, the mining permit holder has two years to bring the mine and any auxiliary areas up to the standards required by public safety and to make the necessary rehabilitation, cleaning and landscaping measures. This includes the measures that have been set out in the mining and mine safety permits.

Redemption permit for a mining area

In most cases, the mining company acquires the title to the surface rights through a voluntary purchase. However, should the applicant of the mining permit not hold the surface rights, the applicant has to obtain, from the government, the right to utilise the area for mining (a redemption permit for a mining area). The granting of such a permit is subject to the mining project being based on public need and the mining area meeting the requirements set forth in the Mining Act (see question 15).

The holder of the mining permit must also pay an excavation fee to the holders of the surface rights as well as compensate in full for damages or harm to the landowners (see question 19).

Renewal and transfer of mineral licences

What is the regime for the renewal and transfer of mineral licences?

Renewal of an exploration permit

An exploration permit is granted for a fixed term of up to four years. The permit can be extended for up to three years at a time for a total period of 15 years. The extension is subject to the following requirements:

  • the exploration must have been effective and systematic;
  • the determination of the exploitability of the deposit requires follow-up research;
  • the permit holder has complied with the terms of the permit; and
  • extending the permit does not cause unreasonable harm to private or public interest.

Mining permit

A mining permit is, as a rule, granted until further notice. A permit can be granted for a fixed term only where there are compelling reasons that relate to, for example, the size and qualities of the deposit and the ability of the applicant to start the mining operation. The term may not exceed 10 years from the date on which the permit gained legal force.

The Mining Act requires TUKES to review the terms of the mining permit every 10 years even for those permits that are valid until further notice. However, the revision of the terms may not materially lower the profit that is derived from the mine.

Transfer of permits

A reservation (for an exploration permit) cannot be transferred.

An exploration permit and a mining permit are transferable. Moreover, an exploration permit application and a mining permit application can be transferred. The transferee has to meet the same legal requirements that are detailed in the Mining Act for a permit holder. For the production of uranium or thorium, a permit pursuant to the Nuclear Energy Act is also required.

The transfer is subject to the approval of TUKES, which generally has to approve the transfer if the formal requirements have been met. However, TUKES may decline to approve the transfer if, for example, the transferee has earlier failed to comply with requirements of the Mining Act.

Change-of-control situations

A change of control in the permit holder (eg, the shareholder of a permit holder company sells its shares to another) does not have to be approved by TUKES in order for the permit to continue to be valid. However, as the exploration permit has a limited term and also because the terms of a mining permit are revised every 10 years, the change of control may lead to changes in the terms of the permit. This could be the case if, for instance, the ability of the permit holder to fulfil the requirements of the permit changed, owing to the change of control.

Duration of mining rights

What is the typical duration of mining rights?

See question 11 in respect of duration and extension of mining rights.

TUKES may cancel an exploration permit, mining permit, or gold panning permit if:

  • in the permit application, incorrect or incomplete information has been given that essentially affected the conditions under which the permit was given, or the permit consideration in other ways;
  • the permit holder no longer meets the requirements for granting of a permit; or
  • the permit holder has materially neglected or violated the obligations, restrictions, or permit regulations laid down in the Mining Act.

If the deficiencies, violations or neglect can be corrected or are insignificant, the Mining Authority shall, before making a decision set out above, set a time limit for the permit holder in question to rectify the defect, violation, or neglect.

Acquisition by domestic parties versus acquisition by foreign parties

Is there any distinction in law or practice between the mining rights that may be acquired by domestic parties and those that may be acquired by foreign parties?

Parties eligible to apply for an exploration or mining permit are the parties entitled to operate a business in Finland, such as:

  • any natural person domiciled within the European Economic Area (EEA);
  • any Finnish corporation or foundation; and
  • any foreign corporation or foundation that has been established in accordance with the laws of a state belonging to the EEA and that has its registered office, central administration or principal place of business in a state belonging to the EEA and has registered a branch office in Finland.

The Finnish Patent and Registration Office may grant a permit to conduct business operations governed by the Mining Act to another natural person as well as to a foreign corporation or foundation. Such a permit is also required for a general or limited partnership unless at least one of the partners in the general partnership or one of the liable partners in the limited partnership is a natural person or corporation that fulfils the above requirements. In addition, a governmental agency may apply for such permits.

In practice, exploration and mining companies usually set up a Finnish subsidiary in the form of a limited liability company through which the activities are carried out

Protection of mining rights

How are mining rights protected? Are foreign arbitration awards in respect of domestic mining disputes freely enforceable in your jurisdiction?

The supervision of the granting of mining rights, their validity and the compliance with the Mining Act by the holders of the mining rights, is carried out by TUKES, whose decisions can be appealed to the administrative courts and, given that a retrial permit is granted, further to the Supreme Administrative Court. Damage compensation claims and injunctions or other temporary procedural remedies are handled by the local district courts as the first instance. Punishments under the criminal code relating to obligations set forth in the Mining Act are also handled by the district courts in the first instance.

Finland is a party to the United Nations New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention), therefore, foreign arbitration awards with respect to countries belonging to the New York Convention, are, as a rule, enforceable in Finland.

Surface rights

What types of surface rights may mining rights holders request and acquire? How are these rights acquired? Can surface rights holders oppose these requests?

Surface rights available for private parties are ownership of land, tenancy or usufruct rights to the surface.

Ownership of land is acquired by purchasing the property by executing a written purchase agreement that must be executed in a specified form. The landowners of a mining area are, however, not under an obligation to sell their property to the mining right holder.

Tenancy is agreed with the landowner in a tenancy agreement, which has to be made in writing and signed by both parties. It is also possible to agree with the landowner on the right to take extractable mineral resources from a property. The right to utilise extractable mineral resources from a property can also be carried out by including in the mining permit such areas where there are mineral resources that are suitable for filling in during mining operations or other material that is required as supplementary material in the processing of the mined products.

Should the mining company not purchase the surface rights, it can obtain usufruct rights to the area needed for mining activity. This takes place either through contractual means or by applying to the government for a redemption permit for a mining area. A redemption permit must be based on a public need and therefore these are not automatically granted. This public need is assessed on the basis of the impact of the mining project on the local and regional economy and employment and society’s need for the raw material.

In this case, the title to the land does not transfer to the mining company. However, if the mining area or its auxiliary area causes major inconvenience for the utilisation of the area, the owner of the surface rights may demand that the whole property or a part thereof is redeemed by the holder of the mining permit. The principle of full compensation to the landowner is the rule. Some other situations exist when the owner of the surface rights may demand redemption. Usually, if possible on reasonable terms, the mining companies purchase the surface rights from the landowner(s) through voluntary acquisitions.

The general rule in Finland is that the owner of a property has to use that property in a way that does not cause inconvenience to neighbours. The Mining Act obliges the holder of the mining rights to compensate the landowners, tenants and other parties for damage and inconvenience, whether temporary or permanent, caused by mining or exploration operations.

In determining the compensation payable to the holders of the surface rights, the principles applicable to compensation in the event of expropriation of property for general needs are used, which generally require full compensation to be paid.

Participation of government and state agencies

Does the government or do state agencies have the right to participate in mining projects? Is there a local listing requirement for the project company?

The government can participate in mining projects, for example, through voluntary investments in mining companies. The government cannot demand a stake in a mining project if the stakeholders of the project do not agree to this. Mining companies do not have to be listed in Finland. Many companies are listed abroad, such as in Toronto or London and may or may not have a dual listing at the OMX Nasdaq Helsinki Exchange.

Government expropriation of licences

Are there provisions in law dealing with government expropriation of licences? What are the compensation provisions?

There are no provisions on government expropriation of licences.

Protected areas

Are any areas designated as protected areas within your jurisdiction and which are off-limits or specially regulated?

Prospecting work and the granting of an exploration permit or gold panning permit is prohibited in the following areas:

  • on the ground of a cemetery, or within 50 metres of such an area;
  • in an area used by the Finnish Defence Forces or any area controlled by the Border Guard where movement is restricted or prohibited, or within 100 metres of such an area;
  • in an area where movement is restricted or access denied to outsiders;
  • on a traffic route or passage in public use;
  • within 150 metres of a building intended for residential or work use, or comparable space;
  • in an area in horticultural use;
  • within 50 metres of a public building or utility, or either a power line with a voltage of over 35,000 volts or an electricity substation; and
  • in any other similar area, designated for special use.

However, prospecting work as well as exploration may be carried out in an area referred to above, except for cemeteries, with the consent of the authority or institution competent in the matter, or that of the relevant holder of rights.

Moreover, there are limitations with regard to certain traffic areas, which in certain cases require the consent of the authority or institution competent in the matter, or that of the holder of the rights for exploration whenever the area in question is a street area or market place, a road area of a highway, an airport or another area in aviation use, a railway area, a canal used for public traffic or another such traffic area, or an area within 30 metres of any of the above-mentioned traffic areas. There are also certain limitations with regard to areas that have previously been covered by an exploration permit or mining permit.

The mining area and the auxiliary area to a mine should, in principle, not be located in an area for which an exploration permit or a gold panning permit cannot be granted, based on the above limitations. However, a mining permit may be granted regardless of an impediment referred to above if the mining area cannot be otherwise implemented as a continuous area of a size and shape that facilitates compliance with requirements concerning safety, location of mining activities and mining technology, and the area in question is not a cemetery or an area of the Finnish Defence Forces or any of the special traffic areas referred to above.

Finally, exploration activities in a Natura 2000 area (ie, a protected area, having certain protected nature values that cannot be substantially weakened) are subject to particular scrutiny. TUKES may not grant a permit for an exploration project, if the exploration to be carried out indicates that the project would have a significant adverse impact on the particular ecological value for which the site has been included in, or is intended for inclusion in, the Natura 2000 network.

Duties, royalties and taxes

Duties, royalties and taxes payable by private parties

What duties, royalties and taxes are payable by private parties carrying on mining activities? Are these revenue-based or profit-based?

Private parties carrying out mining activities in Finland are subject to income taxes, value added tax (VAT) and exploration and excavation fees payable to the landowners. Also, private parties have to pay possible transfer tax and real estate tax in the event that such a party acquires real estate in Finland.

Income taxes

Income tax is payable on the party’s taxable income, calculated in accordance with the relevant tax regulations. Currently, the corporate income tax rate is 20 per cent.


VAT is payable on sold goods and services, unless such goods and services fall under a specific exception. The general VAT rate for goods and services is currently 24 per cent, but there are some exceptions relating to certain products and services. VAT is payable by the seller; however, the seller may deduct the input VAT of purchases of goods and services for business purposes, if another VAT taxpayer has supplied them. Should the amount of VAT paid by the VAT taxpayer for the goods and services purchased for the business operation exceed the amount of VAT payable for the sales of goods and services, the VAT taxpayer will be refunded the excess, provided that the purchased goods and services relate to business activities from the sales of which VAT is payable.

Exploration fees

The holder of an exploration permit shall pay annual compensation (exploration fee) to the owners of land included in the exploration area.

The annual amount of the exploration fee per property is:

  • €20 per hectare for each of the first four years of validity of the exploration permit;
  • €30 per hectare per year for the fifth, sixth and seventh year of validity of the exploration permit;
  • €40 per hectare per year for the eighth, ninth and 10th year of validity of the exploration permit; and
  • €50 per hectare per year for further years of validity of the exploration permit.

The exploration fee for the first year has to be paid within 30 days of the date the exploration permit gains legal force. The fee for the following years is paid at the anniversary of the first payment.

In addition to the exploration fees, the exploration permit holder has to compensate the landowners and owners of the water areas for all damages caused by the exploration work carried out by the exploration permit holder within the exploration permit area. The exploration permit holder has to deposit a collateral for the purpose of offsetting potential damage and inconvenience and performing after-care measures, unless this is deemed unnecessary in view of the quality and extent of the operations, the special characteristics of the operating area, the permit regulations issued for the operations and the applicant’s solvency. The collateral is issued separately for each exploration permit.

Based on TUKES’ decisions, the amount of the collateral tends to be set as follows:

  • €2,000 if the exploration area is less than 1,000 hectares;
  • €2,500 if the area is between 1,000 and 1,999 hectares;
  • €3,000 if the area is between 2,000 and 3,999 hectares; and
  • €4,000 if the area is at least 4,000 hectares.

Should test mining or other similar exploration activities using heavier machinery already be planned in the exploration phase, the collateral is likely to be higher than that mentioned above.

Under the previous Mining Act, if the owner of land requested, the claim holder had to provide to the landowner in question a collateral before the commencement of the exploration work. Many landowners, however, did not require a collateral, so in real terms the new Mining Act has meant increased obligations to exploration companies. To date, TUKES has never resorted to the collaterals.

Concession and mining fees

If the mining permit holder does not own the surface rights to the mining area (as sometimes is the case), the mining permit holder has to pay an annual compensation (excavation fee) to the landowners.

The amount of the excavation fee per property is €50 per hectare per year. In addition to that, the excavation fee has a variable part of 0.15 per cent of the calculated value of mining minerals included in the metal ores that are excavated and exploited in the course of the year. The calculation is based on the average price of the exploited metals included in the ore during the year and the average value of other products exploited from the ore during the year.

If the permit authority postpones the expiry of the mining permit (before mining activities have started or if they have been suspended) the excavation fee is doubled to €100 per hectare until mining activities commence or resume.

The obligation to pay an excavation fee starts when the mining permit becomes legally valid. The obligation to pay elevated compensation starts when the decision on the new date for commencing mining activity, or continuing activities, become legally valid.

For the purpose of the verification of the excavation fee, the mining permit holder has to submit the relevant information to the mining authority no later than on 15 March in the year following the year for which the fee is to be paid. The mining authority confirms the amount of the excavation fee annually.

The excavation fee must be paid no later than 30 days from the date TUKES’ decision on the fee enters into force.

The Government Decree on Mining contains more specific provisions on the grounds for determining the excavation fee as well as on the information to be submitted to TUKES for the purpose of confirming the fee.

Tax advantages and incentives

What tax advantages and incentives are available to private parties carrying on mining activities?

There are certain government subsidies available for development areas in Finland.

Tax stablisation

Does any legislation provide for tax stabilisation or are there tax stabilisation agreements in force?

Finland is a country of low political risk, so no stabilisation agreements are available. The permitted range of VAT is subject to EU laws.

Carried interest

Is the government entitled to a carried interest, or a free carried interest in mining projects?


Transfer taxes and capital gains

Are there any transfer taxes or capital gains imposed regarding the transfer of licences?

When only permits (licences) are transferred, the transaction can be subject to VAT (which the purchaser of the permits can in many cases deduct (see question 19). Further, the profit made in connection with the selling of the licences is subject to capital gains tax, which, for companies other than corporations, is currently 30 per cent for a capital gain not exceeding €30,000 and 34 per cent thereafter. Capital gains for corporations are usually taxed in connection with their normal corporate taxation. The corporate tax rate is currently 20 per cent.

When, for instance, a junior company is acquired by a mining company through a share transaction, the transaction is usually subject to a 1.6 per cent transfer tax and can result in capital gains taxation on the profit that the sellers of the shares make. However, if the junior company whose shares are being sold is owned by a foreign parent company and neither the junior’s parent company nor the purchaser have permanent establishment in Finland, the share transaction is exempt from transfer tax.

Distinction between domestic parties and foreign parties

Is there any distinction between the duties, royalties and taxes payable by domestic parties and those payable by foreign parties?

There is no such distinction. However, see question 13.

Business structures

Principal business structures

What are the principal business structures used by private parties carrying on mining activities?

The most common business structure used to carry on mining activities in Finland is a limited liability company. Foreign companies may also operate through branch offices. Joint ventures (usually in the form of a limited liability company) are also used for cooperation between companies in exploration activities.

Local entity requirement

Is there a requirement that a local entity be a party to the transaction?

The party holding the mining rights under the Mining Act needs to be either a natural or a legal person (corporation) with permanent residence within the EEA or a branch of an association or foundation established in a member country of the EEA. For any other person or foreign corporation or foundation, see question 13.

Bilateral investment and tax treaties

Are there jurisdictions with favourable bilateral investment treaties or tax treaties with your jurisdiction through which foreign entities will commonly structure their operations in your jurisdiction?

Finland has entered into a number of tax treaties, which may affect the structuring of foreign entities’ operations in Finland. There does not, however, seem to be one preferred way to structure the operations and companies have used a variety of structures.


Principal sources of financing

What are the principal sources of financing available to private parties carrying on mining activities? What role does the domestic public securities market play in financing the mining industry?

Most of the parties operating in the mining business in Finland are Finnish subsidiaries of foreign companies, the activities of which are funded through their parent companies by the capital markets in Australia, Canada, Sweden or the UK, or subsidiaries of international mining companies for which the funding comes from the income from the mining company’s own production. It has been very difficult to collect private funding for mining operations from the capital markets in Finland as the mining financing sector is not as developed as in many other countries. Lately, however, Finnish investors and banks have been more interested in the possibilities of investing in or financing mining operations. The government-owned investment company, Finnish Industry Investment, has invested in exploration and mining companies whose projects are in Finland and Finnish banks have recently shown an interest in mining activity with some investing in it. Also, some Finnish pension funds have invested in mining companies.

Certain public funding, such as investment grants or development grants for small and medium-sized companies, may be granted by the ELY centres for exploration and mining operations. Business Finland and the state-owned financing company, Finnvera, may also provide funding or guarantees, or both, for exploration and mining companies operating in Finland. Such funding is subject to applicable preconditions, and in addition the authority can, based on the law, use its discretion when deciding on the grants, loans or other public funding. Certain grants for employment may also be available through the employment administration.

Direct financing from government or major pension funds

Does the government, its agencies or major pension funds provide direct financing to mining projects?

Yes, see question 28.

Security regime

Please describe the regime for taking security over mining interests.

The holder of an exploration permit may pledge its preferential right to a mining permit and the holder of a mining licence may pledge the right to exploit the minerals. The pledge becomes effective when TUKES has received a written notification of said pledge. Naturally, a mining company may also pledge other assets.


Importation restrictions

What restrictions are imposed on the importation of machinery and equipment or services required in connection with exploration and extraction?

Generally, there are no special restrictions for the importation of mining machinery and equipment. There are certain specific laws that may affect the importation of machinery and equipment or services required in connection with mining activities such as the importation of explosives, for which a separate permit is needed.

Standard conditions and agreements

Which standard conditions and agreements covering equipment supplies are used in your jurisdiction?

Orgalime is widely recognised and used in Finland. Additionally, engineering companies use the Nordic Standard Terms of Agreement NL01 for businesses between Nordic countries, while the Orgalime S2000 and S2012 terms are used for wider international businesses. Additionally, the Finnish general terms IT2015 ELT - Special Terms and Conditions for Deliveries of Equipment, used together with the IT2015 YSE General Terms and Conditions, are used widely for IT-related agreements in businesses between Finnish companies and sometimes also in international business.

Arbitration clauses are very common in equipment supply agreements. Arbitration under the Arbitration Rules of the Finland Chamber of Commerce is the most common form of dispute resolution when the parties are from different countries and the Finnish party can choose the dispute resolution forum.

Should equipment (or mining minerals) need to be transported, the Road Transport Contract Act (345/1979), the Railway Transport Act (1119/2000) and Sea Act (674/1994) are applicable. The Road Transport Contract Act is based on the international CRM Convention (1956). The Sea Act takes into account the Hague (1924), Hague-Visby (1968) and Hamburg (1978) Conventions. The said domestic legislation is to some extent carrier-friendly.

Mineral restrictions

What restrictions are imposed on the processing, export or sale of minerals? Are there any export quotas, licensing or other mechanisms that prevent producers from freely exporting their production?

Commodity minerals are generally not subject to export restrictions. There are certain specific regulations, such as regulations regarding precious metals, which have to be followed in order to bring such metals to the market. Export of uranium and thorium is more specifically regulated and subject to a number of permits.

Import of funds restrictions

What restrictions are imposed on the import of funds for exploration and extraction or the use of the proceeds from the export or sale of minerals?

There are no specific restrictions or limitations in the mining laws of Finland concerning the import of funds for mining activities or the use of the proceeds.


Principal applicable environmental laws

What are the principal environmental laws applicable to the mining industry? What are the principal regulatory bodies that administer those laws?

Environmental laws

The Ministry of Environment, together with subordinated regional ELY centres administer the laws relating to the environment.

Revised environmental protection legislation came into force on 1 September 2014 and some of its provisions during 2015. The revised Environmental Protection Act has recently been implemented in three phases. The new law implemented, among other things, the EU Directive on Industrial Emissions on a national level in addition to streamlining the environmental permit granting process and its supervision.

The Water Act controls the use of water resources and structures built along waterways.

The Waste Act prevents the generation of waste and reduces its hazardous or harmful features, promotes waste recovery and other organisation of waste management, prevention of littering and cleaning of sites that have become littered.

The Chemicals Act prevents health and environmental harm and danger of fire and explosions caused by chemicals.

Health and safety laws

The Ministry of Labour, the Ministry of Social Affairs and Health and the Units for Safety at Work administer the health and safety laws.

The Safety at Work Act sets out many standards, according to which an employer shall monitor and take care of the health of every employee. An employer shall also assess the health risks of an employee that are caused by conditions at any particular workplace and remove or minimise those risks.

There are many statutes concerning safe conditions in the workplace and how to handle explosives and various hazardous tools such as laser equipment, according to standards as set out by such statutes.

Environmental review and permitting process

What is the environmental review and permitting process for a mining project? How long does it normally take to obtain the necessary permits?

The nature and scope of the environmental permitting and review process is dependent on the nature of the project and the environmental effects thereof. A mining project requires an environmental permit. Before applying for an environmental permit, the applicant may need to carry out an assessment of environmental impacts that is handled by the competent ELY centre - a process that usually takes about one to two years. This will, however, be amended as a mining permit may in the future be applied without first carrying out an assessment of environmental impacts. After the change, one can get a priority to an area right after applying for a mining permit, even though the environmental impacts are not yet assessed. The environmental permit is granted by the competent AVI, based on a written application that includes a large number of statements, descriptions and other related material on the project. The permits required by the Water Act are often applied for and handled simultaneously with the environmental permit. In addition to the actual review of the permit application during the application process, many parties (such as the local municipality, the owners of real estates and the reindeer associations, if the project is within a reindeer management area) are heard. According to the environmental authorities, obtaining an environmental permit for a new project should take about 10 months. The actual length of the granting process depends on the size of the project, tempering and releases, objections to the project and further clarification possibly required by the authorities.

During the exploration phase, it may be necessary for the holder of the exploration permit to make a notification of the exploration work to the environment authorities in case the exploration work planned to be carried out may have a negative impact on the environment. Such notification is handled by the relevant regional environmental permit authority or the local supervising authority (depending on the nature of the actions to be carried out) that may set certain limitations and obligations that need to be followed by the exploration permit holder in connection with the exploration work to be carried out, otherwise the exploration work may be prohibited.

Closure and remediation process

What is the closure and remediation process for a mining project? What performance bonds, guarantees and other financial assurances are required?

When the holder of a mining permit relinquishes or loses the mining right, the area covered by the mining permit will be returned to the holder of the surface rights without compensation (assuming that the mining company has not purchased the surface rights). The holder of the mining permit may, however, keep the products of the mine, the buildings built on the surface and equipment in the area for two years. Unless removed within that time period, they become, without compensation, the property of the holder of the surface rights.

In connection with the granting of the mining permit, the permit holder will have to deposit a collateral to the mining authority for the purpose of termination and aftercare measures of mining operations that is sufficient in view of the nature and extent of mining activity, the permit regulations issued for the activity and collateral demanded by virtue of other legislation.

After relinquishing or losing the mining permit, the holder has to, without delay, secure the area in such a way that it fulfils the requirements for safety in general. The mine closure and remediation questions are handled before the commencement of any mining actions as a part of the environmental permit process. The environmental permit includes terms regarding the closure of a mine such as restoration of the environment and prevention of tampering. Such terms, generally, will provide for obligations for removal of buildings, equipment and infrastructure, handling of the waste materials and restoration of the landscape, including the revegetation. The environmental permit includes the terms for closure and restoration, based on which, the costs for such operations can be estimated to a general level. The final closure and restoration activities are confirmed in a closure plan, which has to be delivered for approval to the environmental permit authority prior to closure of the mine.

In connection with the granting of the environmental permit, the mining company is required to provide a security for the fulfilment of the closure and restoration obligations. The amount is set by the authorities and the security is generally required in the form of a bank guarantee or bank deposit.

Restrictions on building tailings or waste dams

What are the restrictions for building tailings or waste dams?

The tailing and waste dam safety requirements are defined in the Dam Safety Act (494/2009) and the Government Decree on Dam Safety (319/2010). The act and the decree require that a person planning the construction of the dam as well as the person in charge of the use of the dam, surveillance and inspections, has the requisite experience taking into account the quality of the dam and danger of disaster. Before a dam is taken into use, it needs to receive a risk classification, and the construction plans of dams and ponds, the risk assessment report and the surveillance programme all need to be approved by the environmental permit authority. For dams that may cause substantial danger to life or health of individuals (Class 1), a more detailed risk assessment report is required. These are preconditions for obtaining an environmental permit, the receipt of which is required to carry out mining activities (see question 36).

A dam owner has a general obligation to design and construct a dam in such a way that its use does not constitute any safety hazard. This obligation includes repair and alteration works to the dam. The designer of the dam needs to be professionally qualified and the persons in charge of the operation and management of the dam need to have the necessary knowledge.

No specific mine safety permit is required for the dam. However, compliance with the mine safety legislation is required as it is a prerequisite for obtaining environmental and other permits for constructing the dam.

The owner of the dam is primarily responsible for the surveillance of the dam. Monitoring frequency depends on the dam. Monitoring can be continuous, weekly or take place over three-month intervals, for instance. Dam inspections include inspections while under construction, and when the dam is taken into use, annual inspections as well as periodic inspections. The owner of the dam must:

  • inspect the condition and safety of a Class 1 and 2 dam at least once a year, and notify the written report prepared on the inspection of a Class 1 dam to the dam safety authority;
  • organise a period inspection of Class 1-3 dams at least every five years and, where necessary, more frequently, in which the dam safety authority and rescue authorities have the right to participate; and
  • notify via a written report of the periodic inspection to the dam safety authority.

Emergency planning for dam accidents and rescue operations in the event of an accident are the responsibility of the regional rescue authorities, as set forth in the Dam Safety Act (494/2009) and Rescue Act (379/2011). Any requirements on alarm systems, emergency drills and responsibilities between the company and the authorities regarding the rescue of people are determined by the regional rescue authorities on a case-by-case basis. The owner of the dam must:

  • notify the dam safety authority of emergency calls and exceptional situations related to dam safety;
  • assist the rescue authorities in performing rescue activity together with the dam safety authority; and
  • with due consideration of the dam hazard, take the necessary actions to prevent a dam accident and to limit the damages caused by an accident.

Health & safety, and labour issues

Principal health and safety, and labour laws

What are the principal health and safety, and labour laws applicable to the mining industry? What are the principal regulatory bodies that administer those laws?

Mine safety matters are regulated in the Mining Act and more specific provisions concerning mining safety permit are laid down in the government Decree on Mine Safety (see also question 35).

The general labour laws of Finland are applicable to the mining industry. The principal law regulating labour relations is the Employment Contracts Act. There is also a generally binding collective bargaining agreement applicable to the mining industry.

Management and recycling of mining waste

What are the rules related to management and recycling of mining waste products? Who has title and the right to explore and exploit mining waste products in tailings ponds and waste piles?

The Government Decree on Mining Waste, the Environmental Protection Act and Waste Act set out the principal provisions on the management and recycling of mining waste. Relevant permit conditions on the management and recycling of mining waste are given in the environmental permit. Should the exploration phase include test quarrying or other measures than mere drilling and generating extractive waste, the Mining Act requires that an exploration permit holder must also prepare a mining waste management plan, unless such plan is already required under the Environmental Protection Act.

As described in question 8, a mining permit entitles the holder to exploit the following:

  • the mining minerals found in the mining area;
  • the organic and inorganic surface materials, excess rock, and tailings generated as a by-product of mining activities; and
  • other materials belonging to the bedrock and soil of the mining area, insofar as the use thereof is necessary for the purposes of mining operations in the mining area
Use of domestic and foreign employees

What restrictions and limitations are imposed on the use of domestic and foreign employees in connection with mining activities?

Generally, a non-Finnish person who intends to engage in paid employment in Finland is required to have a residence permit. A person engaged in an independent business or profession in Finland must have a residence permit for a self-employed person.

However, EU citizens and citizens of Iceland, Liechtenstein, Norway and Switzerland can freely work in Finland if the work lasts for a maximum of three months. After that, they must register their right to reside in Finland, but they do not need a special residence permit. The employee must go to the local police department to register his or her right to reside in Finland. Unless it is withdrawn, registration by a person with the right to reside in Finland is valid until further notice.

Foreign employees who are non-EU citizens and equivalent persons need a residence permit for an employed person if they intend to work in Finland. An alien who has entered the country either with or without a visa is not allowed to engage in paid employment in Finland but has to apply for a residence permit. A residence permit can be granted on the basis of either temporary work or work of a continuous nature.

In granting the permit, the needs of the labour market are taken into consideration. The policy aim of the residence permit is to support the possibility of those who are in the employment market to gain employment. Thus, the availability of the workforce in Finland is also supported. To grant a residence permit for an employed person, the foreign national’s means of support must be guaranteed. The employment office will estimate both the labour requirements and the sufficiency of the means of support.

As to Finnish citizens, there are no particular mining law related restrictions in connection with mining activities. As a rule, an employee must be 18 years or older.

Social and community issues

Community engagement and CSR

What are the principal community engagement or CSR laws applicable to the mining industry? What are the principal regulatory bodies that administer those laws?

The Mining Act is the main CSR law applicable to the mining industry.

Rights of aboriginal, indigenous or disadvantaged peoples

How do the rights of aboriginal, indigenous or currently or previously disadvantaged peoples affect the acquisition or exercise of mining rights?

In respect of the Sami homeland, the mining authority TUKES is obliged to establish what the effects of exploration or mining would be on the rights of the Sami people to maintain and develop their own language and culture. TUKES is also obliged to consider what measures would be required for decreasing and preventing such damage. In this context TUKES needs to cooperate with the Sami Parliament, the local reindeer owners’ associations, the competent local administration as well as with the mining permit applicant - the same basically applies for the Skolt people.

International law

What international treaties, conventions or protocols relating to CSR issues are applicable in your jurisdiction?

Section 8J of the UN Convention on Biological Diversity and the International Covenant on Civil and Political Rights is applicable.

Finland has not ratified the ILO 169 Indigenous and Tribal Peoples Convention of 1989

Anti-bribery and corrupt practices

Local legislation

Describe any local legislation governing anti-bribery and corrupt practices.

Finland is a party to the UN, EU and OECD anti-corruption and bribery conventions and the local legislative regime was revised in 2010 in correspondence with the recommendations of the Group of States on Corruption. Under the Criminal Code of Finland, the acts of bribery and the acceptance of a bribe in business are considered offences. Legal entities may be penalised by a corporate fine and individuals may be prohibited from engaging in business in connection with bribery offences to name a few penalties. Furthermore, the provisions regarding anti-money laundering and accounting offences complement the local sanctions regime against corruption and bribery. As part of the due diligence review of a target mining or exploration company, the buyer should consider if there is a risk of potential criminal or tort liability (or reputational risks), owing to corrupt practices by the target company or its group companies. It is also important to note that Finnish anti-corruption and anti-bribery legislation may be applied extraterritorially and hence the practices of the target company’s potential foreign group companies or agents should also be reviewed.

As a result of EU legislation, according to the Act on the Disclosing of Payments Paid to Authorities by Companies in the Field of Extractive Industry and the Logging of Primeval Forests 1621/2015, all exploration and mining companies (or a group of companies) that exceed two of the following thresholds have to report if their payments to state or local authorities exceed €100,000 euros during the financial periods:

  • €40 million in revenues;
  • annual balance sheet total of €20 million; or
  • an average of 250 employees.
Foreign legislation

Do companies in your country pay particular attention to any foreign legislation governing anti-bribery and foreign corrupt practices in your jurisdiction?

Finnish companies pay attention to the UN and EU international sanctions list concerning, among others, export and import restrictions targeted at persons and entities responsible for objectionable policies or actions.

Disclosure of payments by resource companies

Has your jurisdiction enacted legislation or adopted international best practices regarding disclosure of payments by resource companies to government entities in accordance with the Extractive Industries Transparency Initiative (EITI) Standard?

No. There is no need for adopting such practices as the Finnish state does not levy any royalties from the extraction of the country’s natural resources. However, the Finnish state (through the Finnish Forestry Centre, being a public enterprise) is a major landowner in several parts of the country and therefore is often entitled to exploration fees from exploration companies (see question 19). The holder of an exploration permit shall annually disclose the total amount of paid exploration fees to TUKES.

Foreign investment

Foreign ownership restrictions

Are there any foreign ownership restrictions in your jurisdiction relevant to the mining industry?

The Act on Monitoring of Corporate Acquisition gives the government the authority to restrict the transfer of control of companies to foreign nationals should there be a vital national interest.

The act is mainly aimed at change of control situations related to companies in the defence industry and it is very unlikely that the act would be applied in the case of mining sector transactions.

International treaties

Applicable international treaties

What international treaties apply to the mining industry or an investment in the mining industry?

Finland has entered into certain international treaties that apply directly to the mining industry, such as the Convention Concerning Safety and Health in Mines. There are also several other conventions and treaties that relate to the mining industry, for example, through employment and environmental issues.

Update and trends

Recent developments

What were the biggest mining news events over the past year in your jurisdiction and what were the implications? What are the current trends and developments in 2019 in your jurisdiction's mining industry (legislation, major cases, significant transactions)?

In the Annual Survey of the Fraser Institute 2018, Finland was ranked first in Europe in the Investment Attractiveness Index.

Sotkamo Silver AB opened its mine in March 2019, having invested nearly €27 million into it. Its wholly-owned subsidiary, Sotkamo Silver Oy, entered into the off-take agreement for silver and zinc concentrates from its silver mine to Boliden’s Kokkola smelter and Rönnskär’s smelter in Sweden. The estimated value of deliveries during the four year contract period is about €120 million.

Terrafame Oy’s net sales in 2018 reached €325.8 million and the company achieved its annual target for nickel production. In January 2019, the environmental impact assessment of Terrafame’s battery chemicals plant was completed.

In general, the rising demand for battery metals has been welcomed by the Finnish mining industry. The Finnish Mining Association believes that the production of electric vehicle batteries is a great opportunity for Finland. Several new projects are underway to develop cobalt mines to produce cobalt sulfate and concentrates. Finland is considered to be the only significant European producer of raw materials for electric vehicle batteries. In fact, Finland has the potential to produce key materials for more than 500,000 electric vehicle batteries a year, depending on battery chemistry.

There has been public discussion on the need to revise the Mining Act. The Finnish parliamentary elections, which are held every fourth year, will take place in April 2019. In February 2019, in anticipation of the upcoming negotiations to form a government, the Ministry of Economic Affairs and Employment named an outside body to determine the functionality of the laws regulating the mining sector. The report concluded that there is no need to revise the Mining Act.

In March 2019, as one of the last acts of the outgoing government, parliament adopted some changes to the Mining Act. Currently, the Mining Act requires that an applicant must, when necessary, complete a Natura 2000 assessment and an environmental impact assessment when submitting a permit application. This has, in practice, forced the applicant to prepare the assessments years before submitting the mining permit application meaning that one can, after the change, move priority resources to an area immediately after applying for a mining permit, despite the environmental impact or Natura 2000 impact assessments being finalised. The assessments must, however, be conducted before the mining licence can be granted.