Deal structures and chain of title.
What Brazilian law requires about who holds a mining right and how it changes hands, kept apart from the market practice between Brazilian explorers and listed companies. Reviewed 24 September 2026.
Who may hold title#
Mineral exploration and mining depend on an authorization or concession from the Union and may only be carried out by Brazilians or by a company incorporated under Brazilian law, with its head office and management in the country (Federal Constitution, art. 176, §1). A mining right therefore always sits in a Brazilian legal person. The holding company's capital may be 100% foreign; the Constitution requires the nationality of the legal entity, not of its capital.
A limited liability company formed abroad (for example, in Delaware) never holds a mining right in Brazil. It may control the Brazilian holding company or hold an option over the right, but title stays with the Brazilian company.
Border strip. According to the Brazil chapter of Chambers Mining 2026 (a secondary source), the federal government's current interpretation is that the legislation (Law 6,634/1979) does not allow a company with 51% or more of its capital, directly or indirectly, held by non-Brazilians to hold mineral rights within the 150 km strip along the land borders. This is an administrative reading reported by a third party; we did not verify a primary text that sets it.
The chain, step by step#
| Step | Who | What the law says |
|---|---|---|
| 1. Holder of the right | A Brazilian person (Constitution art. 176, §1) | The mining right belongs to the Brazilian company recorded as holder in the ANM file. See the note below on exploration applications. |
| 2. Brazilian company | The holder, or a company that controls it | Capital may be foreign; the holder's head office and management stay in Brazil. |
| 3. Consideration | Foreign party or listed company | The law creates no specific act for this. The counterparty buys quotas or shares of the holding company, or receives an option; see the next section. |
| 4. Transfer of the right | Assignor and assignee; the ANM | The exploration permit (alvará), the mining concession, licensing and the prospector permit may be assigned or transferred, in whole or in part (Decree 9,406/2018, art. 42). The ANM regulates by Resolution the requirements and procedures for registration (averbação) (art. 44). For the concession, the Mining Code, art. 55, §1, provides that acts of alienation or encumbrance are valid only once registered; that provision sits in the concession chapter. |
| 5. Release of escrow | Escrow agent, per the contract | This is a contractual term, not a legal rule. In practice release is tied to the verifiable event of registering the assignment at the ANM. |
An exploration application is not assignable: DNPM Ordinance 155/2016, art. 224, §3, bars the assignment or transfer of applications for exploration permits, licensing registrations and prospector permits. A purchase option is not an act of alienation: it is not registered and does not change the holder. That is why the market tends to use an option conditional on the grant of the permit, or the purchase of the holding company, rather than assignment of the application.
Forms of consideration#
| Form | How it works | Who bears the risk | Note |
|---|---|---|---|
| Purchase option | The listed company pays in staged instalments and holds exclusivity for a period; it exercises the option if results justify it. | The listed company bears the cost of holding the option; the seller bears the time the asset is tied up. | Not registered at the ANM and does not transfer title (see the note to the previous table). |
| Earn-in | The listed company earns a percentage interest by funding exploration in stages. | The listed company funds geological risk before holding a full interest. | Milestones and the timing of each tranche's transfer are set by contract; each transfer of the right follows step 4. |
| Joint venture with a Brazilian company | The parties hold interests in a Brazilian company that holds the right, with agreed governance and contributions. | Shared, in proportion to interest and contributions. | The holder is always Brazilian (Constitution art. 176, §1). |
| NSR royalty retained by the seller | The seller keeps a percentage of net smelter return on future production. | The seller is paid only if there is production; the buyer bears the cost of the royalty. | We give no percentage range: we found no published source that supports one. Not to be confused with CFEM, the statutory production royalty. |
| Payment in shares of the listed company (scrip) | Part or all of the price is paid in shares of the listed company. | The seller bears the share-price risk; the listed company preserves cash. | On an exchange, issuing shares and acquiring an asset may require disclosure and exchange review. |
| Escrow or holdback | Part of the price is held in custody or withheld until a defined event. | The buyer until release; the seller if the event does not occur. | For a mineral asset, the natural release event is registration of the assignment at the ANM. |
All of the forms above are market practice, not Brazilian rules: each depends on the contract. Sources read for the exchange rules: TSX Venture Exchange Policy 5.3 treats acquisitions of non-cash assets (including mineral properties) as exempt or reviewable transactions; ASX Listing Rule 11.1 requires notifying ASX of a significant change to the nature or scale of activities and, if ASX so requires, shareholder approval. On escrow, the SRS Acquiom study concerns acquisitions of private companies (private M&A), not mining: the reference to about 10% of price, for 12 to 18 months, is a statistic from that market and must not be read as mining-sector practice.
Points of attention#
- Surface. The mining right belongs to the Union and is processed at the ANM; the surface belongs to the landowner and appears in the property register (matrícula). The exploration holder must pay rent and compensate damage to the landowner (Mining Code, art. 27). Check the agreement with the surface owner separately from the ANM file.
- Rural land and foreign capital. The acquisition of rural land by foreigners and by legal entities with foreign capital is governed by Law 5,709/1971. This concerns the surface, not the mining right. Confirm the treatment with counsel before the company acquires land.
- Obligations up to date. In exploration, the TAH applies (Code, art. 20, II; Decree 9,406/2018, art. 47). In mining, the RAL (annual mining report) is mandatory for mining concessions, licensing registrations, PLG, extraction registrations, utilisation permits and manifests (15 March and 31 March, per the ANM), and CFEM applies to production and sale (Law 13,540/2017).
- Environmental licensing. The environmental licence does not accompany the mining application: the applicant shows that licensing has been filed, demonstrates every six months that it is under way, and presents the licence before the concession is granted (Decree 9,406/2018, art. 31).
- Australian FIRB. Foreign Investment Review Board approval covers foreign investment in Australia. Guidance Note 5 (Mining, v6, January 2026) deals with Australian mining tenements; it does not regulate the purchase of a Brazilian asset by an ASX-listed company.
Deadlines the law sets#
| Milestone | Term | Rule |
|---|---|---|
| Exploration permit (alvará) | Up to 4 years, extendable for an equal period; more than one extension only in the cases set by regulation. | Mining Code, art. 22, III (Law 14,514/2022) |
| Apply for mining after the Final Exploration Report is approved | 1 year, extendable once for an equal period; within it the holder may negotiate the right. | Code, art. 31; Decree 9,406/2018, art. 28 |
| Utilisation Permit (Guia de Utilização) | Up to 3 years, with one extension for an equal period (per the ANM FAQ). | Decree 9,406/2018, art. 24; ANM Resolution 37/2020 |
| TAH | Annual, during exploration. | Code, art. 20, II; Decree 9,406/2018, art. 47 |
We give no ANM processing times: they are administrative, not fixed by statute. TAH: annual per-hectare fee. Final Exploration Report: Relatório Final de Pesquisa (RFP).