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394 Diagnosing Corruption in Ethiopia
official may not register the discovery in that person’s name but instead
notify a business colleague and register the discovery in the colleague’s
name. The corrupt official may then falsely inform the discoverer that
someone else had previously discovered the minerals.
• Officials collude with mining companies to grant subcontracts to relatives.
° The licensing authority could, as a condition of the license award or
social development plan, require the mining company to undertake
a large amount of additional infrastructure works at the mining company’s
own cost. For example, the mining company may be obliged
to build or refurbish a road, a school, or a hospital. A government
official could then require the mining company to award one or more
of these infrastructure projects to a contractor secretly owned by a
member of the official’s family.
Existing licensing procedures
Ethiopia has generally good procedures to help to minimize corruption
risk in the license issuing process, including the following:
• Mining laws and regulations are reasonably well written, clear, and
simple. There is a clear process for the issuing of licenses. Application
forms, mining licenses, and mining agreements are in standard format
and are reasonably well written. The regulations specify the documents
and information that a mining company has to provide when
applying for a license. Guidelines help the applicant understand the
requirements for prospecting, exploration, and mining programs as
well as the environmental impact assessment. There are also guidelines
that state the minimum amount and type of equipment a licensee
must provide for different types of licenses. All of these factors help to
minimize uncertainty in procedures.
• MOM requires all license applicants to produce evidence showing
which licensed professional had assisted them in developing the exploration
or mining works program and to confirm that the professional
has no link to the ministry.
• The risk of delay is reduced by the introduction of faster procedures
under the BPR previously mentioned.
• Officials have limited discretion to determine license entitlement. The
law grants the licensee the right to receive a license as long as the
licensee complies with the specified licensing requirements. Although