Vol. 132, No. 37 — September 12, 1998

(Erratum)

Regulations Amending the Canada Mining Regulations

Statutory Authority

Territorial Lands Act

Sponsoring Department

Department of Indian Affairs and Northern Development

Notice is hereby given that in the Regulations published in the Canada Gazette, Part I, Vol. 132, No. 36, dated Saturday, September 5, 1998 the schedule published on page 2344 is replaced by the following:

REGULATIONS AMENDING THE CANADA MINING REGULATIONS

AMENDMENTS

1. (1) The definitions "Chief" (see footnote 1) , "Mineral" (see footnote 2), "mining district" and "Territories" in section 2 of the Canada Mining Regulations (see footnote 3) are replaced by the following:

"Chief" means the Director, Mineral Resources, of the Natural Resources and Environment Branch of the Department of Indian Affairs and Northern Development; (chef)

"mineral" means precious and base metals and other naturally occurring substances that can be mined, but does not include

(a) coal, petroleum and related hydrocarbons, native sulphur, construction stone, carving stone, limestone, soapstone, marble, gypsum, shale, clay, sand, gravel, volcanic ash, earth, ochre, marl or peat, or

(b) any other substances regulated under the Territorial Coal Regulations, the Territorial Dredging Regulations or the Territorial Quarrying Regulations; (minéral)

"mining district" means an area established as a mining district pursuant to paragraph 23(g) of the Act; (district minier)

"Territories" means the Northwest Territories and any territories created from the Northwest Territories; (territoires)

(2) Section 2 of the Regulations is amended by adding the following in alphabetical order:

"Act" means the Territorial Lands Act; (Loi)

"depreciable assets", in respect of a mine, means buildings, plant, machinery and equipment that form part of the mine; (actif amortissable)

"exploration cost" means an expense incurred for the purpose of determining the existence, location, extent, quality or economic potential of a mineral deposit in the Territories, but does not include an expense incurred for the purpose of bringing a mine into production; (frais d'exploration)

"fiscal year", in respect of a mine, means the fiscal year of the mine's operator determined for the purposes of the Income Tax Act; (exercice)

"mining property" means

(a) a recorded claim or lease within the boundaries of which a mine is situated, or

(b) a group of contiguous recorded claims or leases, or both, within the boundaries of which a mine is situated,

"mining royalty valuer" means a person designated by the Minister as a mining royalty valuer; (évaluateur de redevances minières)

"owner", in respect of a claim, lease, mine, mining property or abandoned mining work, means any person with a legal or beneficial interest therein; (propriétaire)

"processing" means

(a) crushing, grinding, floatation, beneficiation, concentrating, milling, roasting, smelting, leaching, recrystallization or refining performed to recover minerals from ore or from a mineral-bearing substance, or

(b) where the output of a mine is precious or semi-precious stones, cleaning and sorting that output; (traitement)

"processing assets" means tailings disposal facilities and depreciable assets located in the Territories that are used directly and exclusively in processing; (biens utilisés pour le traitement)

"qualifying environmental trust" means a qualifying environmental trust, as defined in subsection 248(1) of the Income Tax Act, that is created by a trust indenture approved by the Minister; (fiducie pour l'environnement admissible)

"related", in respect of two or more persons, means that the persons are

(a) related persons within the meaning of section 251 of the Income Tax Act,

(b) associated corporations within the meaning of section 256 of that Act,

(c) connected corporations within the meaning of subsection 186(4) of that Act,

(d) affiliated persons within the meaning of section 251.1 of that Act, or

(e) other than for the purpose of subsection 67.1(3), owners or operators of the same mine or persons who are related, within the meaning of any of paragraphs (a) to (d), to owners or operators of the same mine; (liées)

"undeducted balance" means

(a) in respect of a depreciation allowance, the original cost of the depreciable assets in respect of which the depreciation allowance is claimed, less any depreciation allowances previously claimed in respect of those assets,

(b) in respect of a development allowance, the unamortized balance of costs eligible for a development allowance under paragraph 65.1(1)(h), and

(c) in respect of a qualifying environmental trust contribution allowance, the total of all contributions made to the qualifying environmental trust, less any deductions previously claimed; (fraction non amortie)

2. Paragraph 11(1)(e) of the Regulations is replaced by the following:

(e) set apart and appropriated by the Governor in Council for a purpose set out in section 23 of the Act;

3. Subsections 27(1) and (2) of the Regulations are replaced by the following:

27. (1) Subject to these Regulations and to any other regulations made under section 5 or 23 of the Act, the holder of a recorded claim has the exclusive right to prospect for minerals and to develop any mine on the land within the boundaries of the claim.

(2) No holder of a recorded claim shall remove, sell or otherwise dispose of minerals or mineral-bearing substances from the claim the gross value of which exceeds $100,000, other than for assay or testing purposes, before the holder is granted a lease for the claim.

4. Subsections 59(2) and (2.1) (see footnote 4) of the Regulations are replaced by the following:

(2) On the expiry of the term of a lease referred to in subsection (1), including a lease that has previously been renewed, the lessee may apply to the Minister for a renewal of the lease for a further term of 21 years and the Minister shall, on payment of the fee set out in Schedule I and subject to these Regulations, grant the renewal.

5. Sections 62 to 69 (see footnote 5) of the Regulations are replaced by the following:

62. (1) Subject to subsections (4) and (5), a recorded claim or lease, or an interest therein, may be transferred to a licensee at any time.

(2) A transfer of a lease shall be filed with the Chief together with

(a) the applicable fee set out in Schedule I; and

(b) the original lease.

(3) A transfer of a recorded claim, or of any interest therein, shall be

(a) filed with the Mining Recorder of the mining district in which the claim is situated, in a form prescribed by the Minister under section 28 of the Act; and

(b) signed by the holder of the claim.

(4) No lease, or any interest therein, may be transferred if rent owing under the lease is unpaid.

(5) No recorded claim or lease that is part of a mining property, or any interest therein, shall be transferred if mining royalties are due and unpaid in respect of the mining property, unless security in the amount of the unpaid royalties has been deposited with the Minister.

63. (1) A Mining Recorder shall register

(a) every judgement or order relating to ownership of a claim or lease made by a judge of a court of competent jurisdiction, the Minister, the Supervising Mining Recorder or a Mining Recorder;

(b) against the recorded claims and leases that constitute a mining property or any interest therein, a notice of mining royalties due and unpaid for the amount of any mining royalties payable that have not been paid within 30 days after

(c) subject to subsection (2), on the payment of the applicable fee set out in Schedule I, every other document filed in relation to a claim or lease.

(2) No notice of an express or constructive trust shall be registered against a recorded claim.

(3) All persons shall be considered to have received notice of every document registered under subsection (1) as of the date of registration of the document.

(4) A transfer of a recorded claim or lease, or any interest therein, is subject to all judgements, orders, liens and other encumbrances that were registered against the claim or lease, or any interest therein, at the time of registration of the transfer.

64. (1) For the purposes of these Regulations, the date on which a mine commences production is the date the mine begins to produce minerals or mineral-bearing substances in reasonable commercial quantities.

(2) For the purposes of these Regulations, a mineral or mineral-bearing substance shall be considered to be produced and part of the output of a mine if the mineral or mineral-bearing substance is in a saleable form or has been removed from the mine.

65. (1) For each fiscal year, royalties shall be paid to Her Majesty in right of Canada by the owner or operator of every mine on lands referred to in subsection 3(1), on the value of the output of the mine during that fiscal year, calculated in accordance with the following table.

TABLE

Item	Column I Value of output ($)	Column II Royalty payable on that portion of the value
1.	10,000 or less	0
2.	in excess of 10,000 but not exceeding 5 million	5%
3.	in excess of 5 million but not exceeding 10 million	6%
4.	in excess of 10 million but not exceeding 15 million	7%
5.	in excess of 15 million but not exceeding 20 million	8%
6.	in excess of 20 million but not exceeding 25 million	9%
7.	in excess of 25 million but not exceeding 30 million	10%
8.	in excess of 30 million but not exceeding 35 million	11%
9.	in excess of 35 million but not exceeding 40 million	12%
10.	in excess of 40 million but not exceeding 45 million	13%
11.	in excess of 45 million	14%

(2) Royalties payable under subsection (1) in respect of a mine accrue during a fiscal year as the output of the mine is produced and shall be paid to the Receiver General and delivered to the Chief not later than the last day of the fourth month after the end of that fiscal year.

(3) Subject to subsection 67.1(3), the Crown may recover the entire amount of the royalties payable on a mine under subsection (1) from any owner or operator of the mine, or from any person related thereto.

(4) For the purposes of this section, two or more mines shall be considered to be separate mines notwithstanding that the mines

(a) are occupied, worked or operated by the same person;

(b) are under the management or control of the same person; or

(c) produce profits that accrue to the same person.

(5) For the purposes of this section, the value of the output of a mine for a fiscal year is calculated in accordance with the formula

A + B - C + D + E + F + G + H - I

where

A is the total of

(a) the proceeds from sales, during the fiscal year, of minerals or mineral-bearing substances to persons not related to the operator, where evidence of those sales is provided, and

(b) the market value of any other minerals or mineral-bearing substances sold or transferred during the fiscal year,

B is the market value of any inventories of minerals or mineral-bearing substances at the end of the fiscal year, determined under subsection (6),

C is the market value of any inventories of minerals or mineral-bearing substances at the beginning of the fiscal year, determined under subsection (6),

D is the amount of any payment received during the fiscal year that is related to a cost that has been claimed as a deduction or allowance under this section,

E is any excess amount referred to in paragraph 65.1(5)(b),

F is any amount withdrawn during the fiscal year from a qualifying environmental trust established in respect of the mine, up to a maximum of the aggregate of the amounts contributed to the trust,

G is any proceeds from insurance on the mine's property or employees, on minerals or mineral-bearing substances produced from the mine or on the operation of the mine, that were received during the fiscal year,

H is the amount of any grants that were made to the operator, or of any loans to the operator that were forgiven, by the federal government during the fiscal year, and

I is the total of the deductions and allowances claimed under subsection 65.1(1).

(6) The market value of minerals or mineral-bearing substances sold or transferred to a person related to the operator, or to any other person where evidence of the proceeds of disposition is not provided, and of inventories of minerals and mineral-bearing substances, shall be

(a) in respect of precious or semi-precious stones, the maximum amount that would be expected to be realized from the sale of the stones on the open market, after sorting into market assortments, at the time the stones were valued by the mining royalty valuer; and

(b) in respect of any other minerals or mineral-bearing substances, the amount that would be expected to be realized from the sale of those minerals or mineral-bearing substances, to a person who is not related to the operator,

(7) The value of minerals or mineral-bearing substances produced from the reprocessing of tailings shall be included in the value of the output of the mine, and any cost incurred for the reprocessing may be deducted in accordance with subsection 65.1(1).

(8) Gains and losses from hedging transactions related to mineral or mineral-bearing substances produced from a mine shall not be included in calculating the value of the output of the mine.

65.1 (1) In calculating the value of the output of a mine for a fiscal year, only the following deductions and allowances may be claimed:

(a) the costs, incurred during the fiscal year, of sorting, valuing, marketing and selling the minerals or mineral-bearing substances produced from the mine;

(b) the costs, incurred during the fiscal year, of insurance, storage, handling and transportation to the smelter, treatment plant or refinery or to market of, and any duties payable in respect of, the minerals or mineral-bearing substances produced from the mine;

(c) the costs, incurred during the fiscal year, of mining and processing ore or mineral-bearing substances from the mine;

(d) the costs, incurred during the fiscal year, of repair and maintenance at the mine;

(e) general and indirect costs incurred during the fiscal year for property, employees or operations at the mine that are not otherwise allocated to operating costs;

(f) exploration costs incurred during the fiscal year by an owner of the mine on land referred to in subsection 3(1), other than on the mining property, if those costs have not been otherwise claimed as an allowance or deduction under these Regulations, in an amount not exceeding 10 per cent of the value of the output of the mine multiplied by the owner's share of that output, calculated

(g) subject to subsection (5), a depreciation allowance, not exceeding the undeducted balance of the depreciable assets at the end of the fiscal year of the mine;

(h) a development allowance, determined by the operator, not exceeding the undeducted balance at the end of the fiscal year of the mine of

(i) a qualifying environmental trust contribution allowance, determined by the operator, not exceeding the undeducted balance at the end of the fiscal year of amounts contributed to the qualifying environmental trust in respect of the mine; and

(j) if ore or mineral-bearing substances are processed by the operator of the mine prior to sale, an annual processing allowance equal to the lesser of

(2) Where a mine is in production for less than 12 months in a fiscal year or a fiscal year of a mine is less than 12 months,

(a) the processing allowance shall be a percentage equal to 8 per cent multiplied by one-twelfth times the number of months in the fiscal year that the mine is in production or the number of months in the shortened fiscal year, as the case may be; and

(b) the amounts in column I of the table to subsection (1) shall be reduced by multiplying each amount by one-twelfth times the number of months in the fiscal year that the mine is in production or the number of months in the shortened fiscal year, as the case may be.

(3) Where the operator of a mine claims a deduction for costs incurred in a transaction with a related person, the costs allowed as a deduction under this section shall be the amount of the actual costs incurred by the related person, exclusive of any profit, gain or commission to the related person or to any other related person.

(4) A depreciation allowance may be claimed in respect of a depreciable asset in the fiscal year in which it is first used in the operations of the mine.

(5) Where an operator disposes of assets for which a depreciation allowance has been claimed,

(a) the amount eligible for depreciation allowance shall be reduced by the lesser of

(b) where the lesser of the amounts referred to in subparagraphs (a)(i) and (ii) exceeds the value of the assets eligible for depreciation allowance in the fiscal year in which the assets were disposed of, the excess shall be included in the value of the output of the mine for that fiscal year.

(6) For the purposes of subsection (5), where the operator of a mine sells an asset for which a depreciation allowance has been claimed to a related person or removes the asset from the mine, the proceeds of disposition of the asset shall be the amount that could be expected to be realized from the sale of the asset to a person not related to the operator.

(7) Where the operator of a mine purchases an asset that is eligible for a depreciation allowance from a related person or transfers to the mine an asset from another mine owned by the operator, the cost of the asset for the purposes of calculating a depreciation allowance is the amount that the operator could be expected to pay to purchase that asset from a person not related to the operator.

(8) Where in a particular fiscal year the operator of a mine uses processing assets at a mine to process mineral or mineral-bearing substances produced at another mine,

(a) the revenue earned from the processing shall not be included in the value of the output of that mine;

(b) the deductions for the fiscal year for the mill operating costs and asset base used for the calculation of the processing allowance shall be reduced by a percentage equal to the proportion of the mill operating costs attributable to the processing of the minerals or mineral-bearing substances from the other mine in that fiscal year; and

(c) the depreciation allowance for depreciable assets involved in processing for the fiscal year shall be reduced by a percentage equal to the proportion of the mill operating costs attributable to the processing of the minerals or mineral-bearing substances from the other mine.

(9) Where a deduction for a depreciation allowance in a fiscal year has been reduced pursuant to paragraph (8)(c), the undeducted balance of the depreciable assets of the mine that are eligible for a depreciation allowance for the fiscal year shall be reduced by the amount of the depreciation allowance claimed, before any reduction pursuant to that paragraph for the proportion of mill operating costs attributable to the processing of the minerals or mineral-bearing substances from the other mine.

(10) Notwithstanding any other subsection of this section, no deduction or allowance shall be made in respect of a mine in relation to

(a) the capital cost of buildings, plant, machinery or equipment, other than under paragraph (1)(g);

(b) depletion in the value of the mine, mining land or mining property by reason of exhaustion of the ore or minerals;

(c) executive office costs;

(d) where the operator of the mine is a corporation,

(e) interest on any debt, including an overdraft, loan, mortgage, advance, debenture or bond, that is capitalized or expensed for accounting purposes;

(f) remuneration of executive officers or head office costs not directly related to operations of the mine or to the marketing and selling of minerals or mineral-bearing substances produced from the mine;

(g) taxes, or payments in lieu of taxes, paid to any level of government;

(h) royalties paid for the use of mining property or royalties calculated on revenue, production or profits of the mine;

(i) payments made to an organization, community or corporation, including an aboriginal organization, community or corporation, that are not attributable to the provision of goods and services directly related to the development and operation of the mine or to prospecting and exploration on land referred to in subsection 3(1);

(j) payments made for the use or lease of, or access to, the surface of the land on which the mine is located;

(k) management and consulting service costs, other than costs incurred for operations at the mine or for the marketing and selling of minerals and mineral-bearing substances produced from the mine;

(l) discounts on bonds, debentures, shares or sales of receivables;

(m) increases in reserves or provisions for contingencies, other than in respect of a qualifying environmental trust;

(n) dues and memberships for persons other than employees involved in the operation of the mine;

(o) insurance that is not applicable to minerals or mineral-bearing substances produced from the mine, to the marketing of minerals or mineral-bearing substances produced from the mine, the mine's property or employees or to the operation of the mine;

(p) costs incurred during the fiscal year to produce revenue that does not form part of the value of the output of the mine;

(q) the purchase price of a recorded claim, a lease or a mine;

(r) charitable donations; or

(s) any cost not evidenced in accordance with generally accepted auditing practices.

65.2 (1) A change in the ownership or operatorship of a mine does not affect

(a) the undeducted balance of the depreciable assets eligible for a depreciation allowance;

(b) the undeducted balance of the costs eligible for a development allowance;

(c) the undeducted balance of contributions to a qualifying environmental trust; or

(d) the original cost of the assets used for calculating a processing allowance.

(2) Where a recorded claim or lease lapses, is cancelled or is surrendered, any costs incurred in respect of that claim or lease that would otherwise be eligible for a development allowance expire and are no longer eligible for a development allowance in respect of any mine.

66. (1) Where in a particular year ore, minerals or mineral-bearing substances from a lease the gross value of which exceeds $100,000 are treated at a mine, removed from a mine, sold or otherwise disposed of, the lessee shall, within one month after the end of the year, deliver to the Chief a statement setting out

(a) the name and a description of the mine;

(b) the names and addresses of all owners, operators and other lessees of the mine;

(c) the name and address of a person to whom notices may be sent;

(d) the weight of ore, minerals or mineral-bearing substances treated at the mine, removed from the mine, sold or otherwise disposed of during the year and during each month of the year;

(e) the design capacity of any mill, concentrator or other processing plant at the mine; and

(f) the value of any ore, minerals or mineral-bearing substances treated at the mine, removed from the mine, or sold or otherwise disposed of during the year.

(2) A lessee who has delivered a statement under subsection (1) shall forthwith notify the Chief of

(a) any change in the name and address of the person to whom notices may be sent; and

(b) any change in the ownership or operatorship of the mine.

67. (1) On or before the last day of the fourth month after the end of each fiscal year of a mine, including the fiscal year in which the mine commences production, and on or before the same day in each year after the mine ceases production until the mine is completely decommissioned, the operator of the mine shall deliver to the Chief a mining royalty return, on a form prescribed by the Minister under section 28 of the Act, setting out

(a) the name and a description of the mine;

(b) the name and address of the operator;

(c) the names of smelters, refineries or mills to which ore, mineral or mineral-bearing substances have been shipped from the mine for treatment;

(d) the weight of the minerals or mineral-bearing substances produced from the mine that were

(e) the value of the minerals or mineral-bearing substances produced from the mine that were

(f) any costs, deductions and allowances claimed under subsection 65.1(1);

(g) where exploration costs are claimed as a deduction under paragraph 65.1(1)(f), or where costs are included in the costs eligible for development allowance under paragraph 65.1(1)(h), the recorded claims or leases on which those costs were incurred;

(h) in respect of depreciable assets,

(i) in respect of development allowances,

(j) in respect of any qualifying environmental trust for the mine,

(k) in respect of processing assets,

(l) any payment received during the fiscal year that is related to a cost that has been claimed as a deduction or allowance; and

(m) any amount by which the proceeds of disposition of assets for which a depreciation allowance has been claimed exceeds the value of the assets eligible for depreciation allowance in the fiscal year in which the assets were disposed of.

(2) Every mining royalty return shall be

(a) accompanied by the financial statements for the mine or, where the mine has no financial statements, the financial statements of the operator of the mine, and a reconciliation of those financial statements to the mining royalty return; and

(b) signed and include a statement under oath or solemn affirmation by the operator of the mine or, where the operator of the mine is a corporation, by an officer of the corporation, that the financial statements are to that person's knowledge and belief complete and correct.

67.1 (1) Where a mine is operated as a joint venture, each member of the joint venture that takes its share of the output of the mine in kind and sells that share separately from the other members of the joint venture may deliver to the Chief a separate mining royalty return for the royalty payable under subsection 65(1) on the value of its share of the output of the mine, in lieu of including that information in a return delivered under subsection 67(1).

(2) Where, pursuant to subsection (1), more than one member of a joint venture delivers a mining royalty return to the Chief for a single mine,

(a) each member of the joint venture shall be considered to be a separate operator for the purposes of these Regulations;

(b) each member shall indicate on the mining royalty return the percentage of the output of the mine represented by that mining royalty return;

(c) the value of the output on the mining royalty return for each member shall be calculated in accordance with section 65 using

(d) the amounts in column I of the table to subsection 65(1) shall be adjusted by multiplying each amount by a percentage equal to the percentage of the output of the mine received by that member; and

(e) each mining royalty return shall be based on the same fiscal year.

(3) Where a mine is operated as a joint venture and each member of the joint venture takes in kind and separately sells its share of the output of the mine, each member, and any person related to that member, is liable to pay only those royalties attributable to that member's share of the output of the mine.

67.2 (1) Within six years after the end of a particular fiscal year of a mine, the Chief shall send to the operator of the mine a notice of assessment of royalties payable for that fiscal year.

(2) The Chief may at any time send a notice of reassessment for the amount of the royalty payable for a fiscal year in respect of a mine if the operator or other person delivering a mining royalty return has made a fraudulent or negligent misrepresentation in completing the mining royalty return or supplying any other information under section 67 or 67.1.

(3) Where the Chief sends an operator a notice of assessment or reassessment for the amount of royalty payable for a fiscal year, the amount of royalty assessed or reassessed for the fiscal year shall be considered to have been payable on the last day of the fourth month after the end of that fiscal year.

(4) Where the operatorship of a mine changes, the new operator shall file a mining royalty return for the fiscal year in which the change occurred.

68. (1) Every operator of a mine shall keep at an office in Canada and make available to the Chief to substantiate information required on mining royalty returns, evidence for, records of, and books of account showing

(a) the weight and value of all ore, minerals or mineral-bearing substances produced from the mine, sold by the operator or processed at the mine;

(b) the returns from the smelter, mill or refinery and any other returns of amounts derived from the sale of ore, minerals or mineral-bearing substances;

(c) the costs, payments, allowances and other deductions referred to in section 65.1;

(d) financial statements of each owner and the operator;

(e) where the financial statements of an owner or operator of the mine are audited by an external auditor,

(f) any documents filed by an owner or the operator with a stock exchange or securities commission; and

(g) any other information necessary for ascertaining the amount of royalty payable under section 65.

(2) No person shall disclose information of a confidential nature acquired for the purposes of sections 65 to 69, except

(a) to the extent necessary to determine the amount of royalties payable under section 65;

(b) where required under a land claims agreement referred to in section 35 of the Constitution Act, 1982; or

(c) under an agreement entered into by the Minister for the purpose of the administration of section 65 with the government of a country, province or state, or with an aboriginal organization owning mineral rights, under which the officers of that government or aboriginal organization are provided with the information and the Chief is provided with information from the government or aboriginal organization.

(3) No person who receives confidential information under paragraphs (2)(a) to (c) shall disclose that information.

69. (1) No ore, minerals or mineral-bearing substances produced from a mine, other than precious or semi-precious stones, shall be removed from the mine, other than for assay or testing purposes, until the weight and any other information necessary to establish its value has been ascertained and entered in the books of account referred to in subsection 68(1).

(2) No precious or semi-precious stones shall be removed from a mine, other than for assay or testing purposes, or sold until they have been valued by a mining royalty valuer.

(3) The operator of a mine shall provide in the Territories such facilities as are necessary for a mining royalty valuer to value any precious or semi-precious stones produced from the mine.

(4) Facilities within the Territories that are provided for valuation of precious or semi-precious stones by a mining royalty valuer shall be considered to be part of the mine for the purposes of these Regulations.

(5) Where any part of the output of a mine is comprised of precious or semi-precious stones, no stones shall be sold or removed from the mine until the operator of the mine has cleaned the stones so as to remove all substances from the stones that are not part of the stones.

6. Section 84 (see footnote 6) of the Regulations is replaced by the following:

84. (1) Any person with a legal or beneficial interest in the subject matter of an order, decision or direction made, or any other action taken or omitted to be taken, under these Regulations by the Supervising Mining Recorder, a Mining Recorder, the Chief, a mining royalty valuer or an engineer of mines may, within 30 days after the making of the order, decision or direction or the taking of the action or, in the case of an omission to take action, within 30 days after the action should have been taken, apply to the Minister in writing for a review of the matter.

(2) An operator of a mine may, within 90 days after an assessment or reassessment is sent under section 67.2, apply to the Minister in writing for a review of the assessment or reassessment.

(3) On receipt of an application made under subsection (1) or (2), the Minister shall

(a) request, from the applicant or any other person, any documents, further particulars or written argument necessary to determine the matter;

(b) review the matter or conduct a hearing into the matter;

(c) either

(d) advise the applicant in writing of his or her decision, and the reasons therefor.

7. Item 18 (see footnote 7) of Schedule I to the Regulations is replaced by the following:

Item	Column I Licence, Service Certificate or Permit	Column II Fee
18.	Rental under lease, per acre, per year (a) for the initial 21 year period (b) for each 21 year renewal period	1.00 2.00

8. Paragraphs 5(3)(a) and (b) of Schedule II to the Regulations are replaced by the following:

(a) the holder of the claim must be an individual or in a registered partnership with one or more individuals;

(b) the work must be performed by the holder of the claim with respect to his or her own claim or claims; and

9. Forms 17 and 18 of Schedule III to the Regulations are repealed.

TRANSITIONAL

10. (1) Notwithstanding subsection 67(1) of the Regulations as amended by section 5, for the fiscal year of a mine during which these Regulations come into force, the operator of the mine shall deliver to the Chief

(a) a mining royalty return for the entire fiscal year, on Form 18 of Schedule III of the Regulations as it read before the coming into force of these Regulations, with the information required by, and the royalties payable calculated in accordance with, section 65 of the Regulations as it read before the coming into force of these Regulations; or

(b) a mining royalty return for each of

(2) For the purposes of calculating the royalty payable for a period referred to in subparagraph (1)(b)(i),

(a) the depreciation allowance and the preproduction allowance shall be a percentage equal to 15 per cent multiplied by one-twelfth times the number of complete and partial months in the fiscal year before the coming into force of these Regulations;

(b) the processing allowance shall be a percentage equal to 8 per cent multiplied by one-twelfth times the number of complete and partial months in the fiscal year before the coming into force of these Regulations; and

(c) the dollar amounts in paragraphs 65(1)(a) to (d) as they read before the coming into force of these Regulations shall be reduced by multiplying each amount by one-twelfth times the number of complete and partial months in the fiscal year before the coming into force of these Regulations.

(3) For the purposes of paragraph 65.1(1)(g) of the Regulations as amended by section 5, the cost of a depreciable asset of a mine that was not used in the production of the output of the mine is not eligible for depreciation allowance if the cost was incurred before the coming into force of these Regulations.

(4) Notwithstanding subsection (3), all depreciable assets of a mine that commences production after the coming into force of these Regulations are eligible for a depreciation allowance, including costs in respect of those assets incurred before the coming into force of these Regulations.

(5) Notwithstanding subsection 67.2(1) of the Regulations as amended by section 5, in respect of any fiscal year of a mine that ended before the coming into force of these Regulations, the Chief may send to the operator of the mine a notice of assessment of royalties payable for that fiscal year that is different from the royalties paid for that fiscal year within six years after the coming into force of these Regulations.

COMING INTO FORCE

11. These Regulations come into force on the date on which they are registered.

[37-1-o]

Footnote 1

SOR/88-9

Footnote 2

SOR/88-9

Footnote 3

C.R.C., c. 1516

Footnote 4

SOR/79-234

Footnote 5

SOR/88-9; SOR/79-234

Footnote 6

SOR/92-552

Footnote 7

SOR/97-117

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