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obligations set forth in the Mining Code.In addition, holders of mining rights are required to pay landowners a monthly share in the miningresults due to the occupation of the area, and a compensation for any damages caused by the mineralexploration and/or extraction activities. The obligation to pay for the land occupancy and tocompensate landowners for any damages caused exist in the exploration stage as well.It is worth noting that the mining company must obtain all environmental permits needed in order tocarry out mineral exploration activities.23. 7. Small-Scale Mining PermitThe Small-Scale Mining Permission System is applicable whenever a mineral deposit is – due to itsnature, size and location – capable of being exploited immediately (without prior exploration). In thiscase, requirements set by the DNPM, in charge of issuing the respective permit, must be met.Small-Scale Mining Permits are issued for up to 5 years, subject to extension at DNPM's discretion.Both Brazilian individuals and small-scale mining cooperatives are entitled to apply for small-scalemining permits.23. 8. Border Areas / Indigenous Peoples' LandBorder Areas are areas within the national territory that border other countries. They can be up to 150km wide. Therefore, they are essential for national security, and their occupation and use areregulated by law.The prospection, extraction, exploration and exploitation of mineral resources on border areas requirethe prior authorization of the National Defense Council.Only Brazilian individuals or companies controlled by Brazilians with management in Brazil andpredominantly Brazilian staff can be authorized to carry out activities on border areas.Mining activities on indigenous peoples' land require express authorization of the National Congress,pursuant to the Brazilian Constitution. However, the exploration and exploitation of mineral resourceson indigenous peoples' land are not yet regulated.23. 9. New Regulatory FrameworkThe currently discussed proposal for a new regulatory framework is a result of comprehensive studieson regulation in Brazil and other countries, feedback from entities from the mining industry and acontinuous search for new investments with a view to stimulate the industry's development. 5Among the proposed changes is the creation of the National Council for Mining Policy (Conselho5 www.mme.gov.br119