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Corruption in the Mining Sector: Preliminary Overview 399
speculatively with the hope of selling it to another mining company
for a profit. It therefore may not comply with the condition.
• Mining companies offer bribes to overlook breaches.
° The environmental management plan for an exploration license
requires trial trenches to be infilled after testing is complete and for
vegetation to be replanted. The mining company may not do so and
may offer a bribe to the licensing authority inspector to overlook the
breach.
• Inspectors request bribes to overlook breaches of license conditions.
° The environmental management plan for a quarry requires the
access area (which is next to houses) to be watered to reduce dust.
The mining company might decide at any time during mine operation
not to water the area, as a result saving considerable staffing and
water costs over the duration of the license. The licensing authority
inspector arrives at the quarry and notices that no watering is taking
place. He threatens enforcement action against the mining company
and requests a bribe from the mining company to overlook the
breach.
• Officials require the mining company to
° undertake work for the official’s benefit;
° use land or facilities that the official owns or has an interest in; or
° donate to charities for the official’s secret benefit.
• Mining companies operate with no license or an expired license.
• Mining companies illegally sell mining equipment that has been imported
into Ethiopia free of customs duties and taxes.
Existing license compliance procedures
In Ethiopia, the licensing authorities attempt to reduce the risk of mining
companies’ noncompliance with license conditions by inspecting
the mines. However, this procedure is hampered by two factors: the
current lack of inspectors and the lack of clear license conditions in
some cases.
As an example of the shortage of inspectors, at the time of this
writing,
• MOM has only 13 staff members in its general inspection unit and three
environmental inspectors to handle 160 federal licenses across the
country, many of them in remote areas.
• The Oromia regional licensing authority has only three inspectors to
monitor approximately 570 active regional licenses.