A practical reading of Article 12 of the Sudanese Mineral Wealth and Mining Development Act 2015 for international counsel and foreign investors

Why Article 12 Matters for Foreign Investment in Sudan

In mining transactions, the biggest delays rarely come from geology. They come from eligibility—what regulators require before they will issue a licence or sign a mining contract.

For foreign investment in Sudan, this point is decisive. Many investors assume that licensing is primarily a technical exercise, but Sudan’s framework is designed to test whether an applicant is a credible operator from a corporate, financial, technical, and compliance perspective.

Article 12 of the Sudanese Mineral Wealth and Mining Development Act 2015 (قانون تنمية الثروة المعدنية والتعدين لسنة 2015) does exactly that. It sets out a practical “gatekeeping” standard for licences and mining contracts, and it is one of the most useful provisions for international law firms advising investors entering Sudan.

If you understand Article 12 early, you reduce execution risk, avoid avoidable rejection, and align your project structure with what the regulator actually expects.

What Article 12 Requires (Translated and Explained for International Readers)

Article 12 states that to obtain a prospecting/exploration licence or to conclude a mining contract, the applicant must satisfy a set of core conditions. In investor terms, Article 12 is a compliance-and-capability test.

Here is what it requires, translated into an actionable legal checklist:

1) Corporate registration evidence (proof of legal existence).
If the applicant is a company, business name, or branch of a foreign company, it must provide a certificate of registration. For foreign investors, this ties licensing to a clean corporate presence and documentary proof of capacity to contract.

2) Financial capability.
The applicant must demonstrate that it has sufficient financial ability to perform its contractual obligations. This is investor-relevant: Sudan expects that a licence holder can fund exploration programmes, operations, HSE compliance, and associated obligations—not merely hold acreage speculatively.

3) Technical competence and experience.
The applicant must have adequate technical capability and expertise in mining. This supports a policy objective seen globally: preventing under-qualified operators from holding licences they cannot execute, which can create safety, environmental, and reputational risks for the sector.

4) Tax and zakat clearance.
Article 12 requires a clearance certificate relating to taxes and zakat. This is a critical compliance expectation. For foreign investors, it often means that licensing strategy must integrate local fiscal compliance planning and not treat it as an afterthought.

5) Confirmation that the area is free from disputes.
The applicant must provide a certificate confirming that the licence area is free from disputes issued by the competent authorities. This requirement speaks directly to political and land-risk management and will be of immediate interest to international counsel and risk committees assessing foreign investment in Sudan.

6) Payment of fees.
The applicant must commit to paying the prescribed fees.

Article 12 then separately regulates conditions for traditional (artisanal) mining contracts, limiting eligibility to Sudanese nationals meeting basic age and registration conditions and paying the required fees. This is important for foreign investors because it clarifies that certain activities are reserved for domestic participation, while industrial-scale investment can proceed under the licensing and mining contract route.

How Article 12 Compares with International Mining Practice

Article 12 of the Sudanese Mineral Wealth and Mining Development Act 2015 is not unusual by global standards. In fact, it mirrors the core licensing approach used in many mining jurisdictions.

Most modern mining laws require the regulator to assess:

• legal identity (corporate registration),
• financial capacity (ability to fund work programmes),
• technical competence (operator credibility), and
• compliance posture (tax and regulatory standing).

Sudan’s Article 12 fits squarely within this international pattern. A comparable approach exists in leading African and global mining jurisdictions, where regulators increasingly screen applicants to prevent licence hoarding and ensure that mineral resources are developed responsibly and safely.

Where Sudan’s approach is particularly noteworthy for foreign investment in Sudan is the explicit emphasis on:

• tax/zakat clearance, and
• dispute-free area confirmation.

These provisions reflect Sudan’s policy priorities: improving fiscal compliance and reducing operational conflict risk. For investors, this can be viewed in two ways. Some will see it as added friction. Others—particularly institutional investors—will view it as a positive sign of rule-based governance, because it makes the approval criteria more transparent and defensible.

The more predictable the gatekeeping rules, the more investable the jurisdiction becomes.

What Foreign Investors and International Law Firms Should Do in Practice

For foreign investors considering foreign investment in Sudan, Article 12 should be used as a project-planning tool. In practical terms, it is best approached as a pre-licensing “readiness file” assembled before submission.

A robust Article 12 readiness approach typically includes:

A. Corporate structuring and documentation
Confirm early whether the investment will be made through a locally incorporated entity or a registered branch structure. Ensure corporate certificates, authorisations, and signatory powers are aligned and “submission-ready.”

B. Evidence of financial capability
Prepare credible proof of funding—this may include audited accounts, financing commitments, parent guarantees, or board-approved funding plans. The goal is not merely to show wealth, but to show capacity to execute the work programme.

C. Technical competence narrative
Present the technical team’s track record and execution plan. For multinational groups, this should connect group capabilities to the Sudan project (not just generic corporate brochures).

D. Compliance hygiene (tax and zakat)
Build fiscal compliance into the entry timeline. Where a vehicle is new, plan carefully how the relevant clearances will be obtained.

E. Area due diligence and dispute mapping
The requirement for dispute-free confirmation should prompt careful pre-entry diligence: land and community mapping, coordination with competent authorities, and documented risk controls.

For international law firms, Article 12 is also a useful anchor for transaction documentation and negotiations. It supports clear conditions precedent, compliance warranties, and risk allocation clauses in mining contracts, joint ventures, and farm-in structures.

Why Article 12 Supports Sudan’s Economic Potential

Foreign investment decisions are driven by confidence in systems. Article 12 supports Sudan’s economic potential because it seeks to ensure that mining rights are held by parties capable of real development, compliance, and responsible operations.

If implemented predictably, this framework can help Sudan:

• attract credible operators,
• reduce “speculative” licence holding,
• improve safety and environmental outcomes,
• and strengthen the fiscal base of the mining sector.

For foreign investment in Sudan, the message is simple: Sudan’s mining law is not only about granting rights—it is about creating a workable compliance standard that serious investors can meet and plan around.

Conclusion

Article 12 of the Sudanese Mineral Wealth and Mining Development Act 2015 is one of the most practical provisions for investors. It sets the investor-entry test: legal identity, capacity, competence, compliance, and area integrity.

For international law firms and foreign investors, understanding Article 12 early can significantly reduce licensing delays and transactional uncertainty—key factors for foreign investment in Sudan.

At Sudanese Commercial Law Office (SCLO), we support international law firms, multinational companies, and foreign investors with licensing readiness, legal structuring, and regulatory strategy under the Sudanese Mineral Wealth and Mining Development Act 2015, ensuring that mining investments are positioned for approval, compliance, and long-term success.

‍