The Government of San Juan sent to the provincial Chamber of Deputies the Local Mining Development Bill, an initiative aimed at establishing a framework for the participation of San Juan workers and suppliers in major mining projects operating in the province.
By Panorama Minero
The proposal was submitted by the Executive Branch in a context of mining expansion in San Juan, driven by copper projects and investments linked to the Incentive Regime for Large Investments (RIGI). According to the submitted text, the objective is to create mechanisms to measure and promote local participation in employment, procurement and services associated with mining activity.
1. Mandatory Employment and Supplier Development Plans
One of the central points of the bill is the requirement for mining companies and their main contractors to submit Employment and Supplier Development Plans, with progressive targets and periodic compliance reports.
These plans must be updated every two years and include information on workforce hiring, goods procurement and service contracting.
2. No Mandatory Quotas
The bill does not establish automatic hiring obligations or direct restrictions on free competition.
Instead, it proposes a framework based on planning, targets, indicators and accountability by companies, which will have to justify any deviations from the stated objectives.
3. 80% San Juan Employment Target
The initiative sets a target for 80% of workers in each mining operation to be residents of San Juan, with priority given to departments within the direct area of influence of each project.
The bill provides for monitoring mechanisms to track the evolution of these indicators and includes training actions when there is not enough local workforce availability.
4. 60% Local Procurement Target
Another key component is for companies to allocate 60% of their annual procurement value to San Juan suppliers, provided there is available supply under competitive market conditions.
When companies do not reach that percentage, they must technically justify the absence of local suppliers under equivalent conditions of quality, price or operational capacity.
5. Creation of the Provincial Mining Supplier Registry
The proposal creates the San Juan Mining Supplier Registry (RE.PRO.MIN), a public and digital database designed to identify the companies that may be counted toward the targets established by the law.
To be included in the registry, companies must prove an operational address in the province, local tax registration and a workforce made up of at least 80% San Juan personnel.
6. Advance Publication of Mining Demand
Companies will be required to report their future needs for goods and services through estimated procurement schedules.
The objective is to allow local suppliers to anticipate investments, training and capacity adjustments in order to compete for contracts linked to mining projects.
7. Incentives for Companies That Comply
The bill incorporates an incentive framework for operators that simultaneously meet the employment and local procurement targets.
In such cases, they may access a transferable Tax Credit Certificate, which may be assigned to mining suppliers for the payment of provincial taxes.
8. Transparency in Contracting
The initiative provides for publicity mechanisms linked to contracting processes.
Companies must disclose calls for bids, demand for goods and services and contract awards, with the objective of facilitating access for local suppliers to business opportunities and enabling monitoring of the indicators established by the regulation.
9. Scope of the Law
The proposal applies to both mining companies and their main contractors.
As a result, planning and reporting obligations extend to a significant part of the value chain associated with mining projects.
10. Enforcement Authority and Oversight
The Ministry of Mining will be the enforcement authority and will be supported by a public-private Advisory Council and an Interministerial Technical Unit responsible for monitoring and auditing.
Their functions will include verifying submitted plans, measuring results and controlling the local value added declared by companies.
11. Fines of Up to 60,000 Tax Units
The bill establishes sanctions for unjustified non-compliance with the obligations provided for in the regulation.
Measures may range from warnings to fines equivalent to 60,000 Tax Units, depending on the seriousness of the violation and the track record of the company involved.
The initiative also states that no sanctions will apply when companies prove the absence of competitive local supply or demonstrate that they have carried out training actions to address those gaps.
12. Replaces a Previous Law and Sets Implementation Deadlines
The bill repeals Law 1208-M, a regulation that, according to the provincial government, was never implemented.
It also establishes that companies must submit their initial plans within 60 to 90 calendar days from the entry into force of the regulation.
Next Legislative Step
The initiative will now begin its treatment in the provincial Legislature. If approved, it will establish new planning, monitoring and incentive mechanisms linked to the participation of local employment and suppliers in San Juan’s mining activity.
The bill enters one of the most sensitive debates in provincial mining: the organization of local procurement, the participation of San Juan companies in the value chain and the priority criteria for provincial workers and suppliers. In recent years, different chambers and sector stakeholders have raised overlapping demands over the need to define clearer rules for local hiring and procurement in major mining projects.
