Mining Law

The United States depends heavily on rare earth elements (REEs) for both everyday products and national security. These materials are essential for items such as smartphones, electric vehicles, wind turbines, and advanced military equipment. Concerns about the security and reliability of the U.S. REE supply chain have become a major policy issue in Washington. Greenland’s geology makes it especially interesting in this context. The island contains a wide range of critical minerals and holds some of the world’s largest undeveloped rare earth deposits. In other words, many of the minerals that are crucial for modern technologies could, in principle, be sourced from Greenland. At present, more than 60% of the world’s rare earths are mined in China, and China controls over 90% of the global processing capacity. This concentration creates a strategic vulnerability for Western countries, which depend on Chinese production and processing for these key materials. Greenland, by contrast, offers significant but largely untapped potential. In addition to rare earths, it is believed to host deposits of gold, copper, nickel, iron ore, zinc, molybdenum, tungsten, titanium, and vanadium, along with graphite and diamonds. Greenland is also thought to have large reserves of oil and natural gas. While many of these minerals are currently produced in China and in several African countries, there are growing reasons to look for new sources. These include geopolitical tensions, concerns about supply disruptions, transportation costs, and the need to secure long-term access to critical resources. Despite its vast resource potential, Greenland’s mining sector is still in the early stages. Most activity remains focused on exploration and evaluation rather than large-scale production. As global demand for critical minerals continues to rise, however, Greenland is likely to draw increasing attention as a possible alternative or complementary source of supply. For mining companies and their advisors, Greenland’s resource potential highlights a broader reality: as demand for critical minerals intensifies, attention increasingly turns to jurisdictions with significant but undeveloped deposits. In such contexts, geological promise is only part of the equation. Regulatory frameworks, permitting processes, environmental and social considerations, and access to infrastructure often play an equally decisive role in determining whether and how projects advance.   In many respects, these dynamics will sound familiar to industry participants operating in Canada and Quebec, where strategic minerals, evolving policy priorities, and heightened expectations around responsible development continue to shape the mining landscape. Greenland therefore offers a useful point of reflection on how global supply chain pressures can create both opportunities and complexities for mining projects. Lavery’s Mining Law Group regularly assists clients in navigating these issues and is available to help assess how such developments may translate into practical considerations for their business.

Under the Act to amend the Mining Act and other provisions1 (the “Act”), assented to on November 29, 2024, certain amendments were made to the Mining Act.2 In this bulletin, we will focus on the rules that have been in effect as of the Act’s date of assent concerning the assignment of a mining lease or a mining concession, and those that have been in effect since November 29, 2025, concerning the transfer of an exclusive exploration right (“EER”), formerly known as a claim. Except in the case of the assignment of a mining lease or a mining concession made under the Companies’ Creditors Arrangement Act3 or the Bankruptcy and Insolvency Act,4 this type of transfer will require that a financial guarantee be provided in advance to the Minister of Natural Resources and Forests (the “Minister”) by the new holder. Without it, the transfer will be null and void.5 Furthermore, as mentioned above, a new restriction has been introduced on the transfer of an EER during the first three years of its registration,6 that is, before it is renewed. During this initial validity period, the transfer of an EER will now require its holder to first obtain authorization from the Minister by submitting the required form.7 The transfer will be granted by the Minister if the exploration work required and determined by regulation has been carried out on the property that is subject to the mining right. The assignment of an EER without prior authorization from the Minister will be null and void. 2024, chapter 36, Bill 63. CQLR c. M-13.1. R.S.C. (1985), c. C-36. R.S.C. (1985), c. B-3. Section 123.1 of the Mining Act: this requirement is also found in section 101 of the Mining Act for the granting of a mining lease. This initial validity period established in section 61 of the Mining Act will vary for converted EERs, according to what is stipulated in section 83.3, depending on the expiry date of the EERs before they were converted into map designated EERs. At the time of writing this bulletin, it appears that the Minister has not yet adopted the means to implement this restriction and the specific form to be submitted in the event of the assignment of an EER affected by this. However, we note that since the new provisions came into force, a box to check has been added to Section 3 of the mining rights transfer application form, entitled “List of mining titles, percentage transferred and authorization,” for requesting authorization from the Minister. Consequently, we assume that the application for authorization will be submitted at the same time as the form is submitted to the Register of real and immovable mining rights.

The federal budget presented on November 4, 2025 (the “Budget”), proposes a significant change to the Critical Mineral Exploration Tax Credit (CMETC). As a reminder, the CMETC is equal to 30% of “specified mineral exploration expenses”1 incurred in Canada that a company has renounced to flow-through share investors. Critical minerals currently eligible for the CMETC The critical minerals currently eligible for the CMETC are nickel, cobalt, graphite, copper, rare earth elements, vanadium, tellurium, gallium, scandium, titanium, magnesium, zinc, platinum group metals, uranium and lithium (including lithium from brine deposits). Critical minerals added to the list The Budget proposes to expand the definition of “critical mineral” to include the following additional critical minerals: bismuth, cesium, chromium, fluorspar, germanium, indium, manganese, molybdenum, niobium, tantalum, tin and tungsten.  Impact of this measure on mining exploration expenses The measure will make the 30% CMETC apply to exploration expenses relating to these new types of critical minerals that a mining exploration company would renounce to flow-through share investors. The measure will cover exploration expenses renounced under flow-through share agreements entered into after Budget Day and on or before March 31, 2027. The Budget also confirms the renewal of the Mineral Exploration Tax Credit until March 31, 2027 (METC). Please feel free to contact our professionals for more information Canadian exploration expenses incurred by a company after April 7, 2022, as part of mineral exploration activities conducted from or above the surface of the earth targeting mainly critical minerals.

Many Canadian entities and other entities conducting business in Canada have reporting obligations under the Fighting Against Forced Labour and Child Labour in Supply Chains Act (the “Modern Slavery Act”), which came into effect on January 1, 2024. These obligations include completing an online questionnaire and filing an annual report on the steps taken to prevent and reduce the risk of forced labor or child labor in their supply chain. The Modern Slavery Act applies to government institutions producing, purchasing or distributing goods in Canada or elsewhere, and to “entities” producing goods in Canada or elsewhere or importing goods produced outside Canada or controlling such entities. An "entity" refers to organisations that are listed on a Canadian stock exchange or have a business presence or assets in Canada and satisfy certain thresholds related to assets, revenue, or number of employees. As organizations prepare for the upcoming reporting deadline of May 31, 2025 - a second report for many - they should consider the following: It is useful to review guidelines, which were updated by Public Safety Canada in November 2024 to clarify key terms such as assets, goods, and importer. Failure to submit the report in accordance with the Modern Slavery Act may result in substantial penalties, including fines and potential liability for the directors, officers, and employees involved. The report must encompass a broad range of information, receive approval from the entity's governing body, and include the required attestation. Sufficient resources and time should therefore be allocated to the preparation and approval of the report. In summary, reporting entities and governmental institutions subject to the Modern Slavery Act should promptly review their obligations and gather the necessary information for their reports. Timely and accurate reporting is crucial to avoid legal and financial consequences. For assistance or clarification on compliance with the Modern Slavery Act, please contact Mylène Vallières at mvallieres@lavery.ca.