Articles

Mining Licences in Kyrgyzstan: A Guide for Foreign Investors

November 5, 2026

By Karym Salamatov — Managing Director, Bond Stone International Law Firm, Bishkek Office

Mining is central to the Kyrgyz economy, and gold in particular draws foreign interest. The rules have changed several times in recent years, so advice given even a few years ago may be out of date. Before committing capital, an investor needs to know which route to a licence applies, whether the State must hold a stake, and what can put the licence at risk.

The legal framework

The main statute is the Law on Subsoil of 19 May 2018 No. 49, which replaced the 2012 law and has been amended since. Secondary rules include Government Resolution No. 561 of 29 November 2018 on licensing subsoil use, and Cabinet of Ministers Resolution No. 449 of 12 August 2022 on licence holding fees, whose payment procedure was last amended in September 2026.

Licensing is handled by the Ministry of Natural Resources, Ecology and Technical Supervision. The Cabinet of Ministers decides certain matters directly, including tenders for subsoil plots of national significance.

Can a foreign investor hold a licence?

Yes. The Law on Subsoil does not bar foreign parties from holding exploration or extraction rights, and it prohibits discrimination by citizenship or country of registration. A foreign company may take part in auctions and tenders or use the first application route, but if it succeeds it must set up a wholly owned subsidiary in Kyrgyzstan to hold the licence.

Equal treatment in the statute is not the whole picture. Since 2022, Article 20 of the Law on Subsoil has required every subsoil user to buy at least 80% of its goods and services in Kyrgyzstan, where they are produced there, and to hire at least 90% of its staff from Kyrgyz citizens, unless a treaty in force provides otherwise. Larger projects may also face investor-specific requirements, such as local employment or board seats. The rules on gold and silver below are the most important exception.

How licences are granted

The legislation provides separate licences for geological prospecting, exploration and extraction. There are three main routes:

An exploration licence gives an exclusive right to convert it into an extraction licence once the reserves are recorded on the State Balance of Mineral Reserves. Extraction licences may run for up to 20 years and can be extended until the reserves are exhausted.

Gold and silver: state participation

This is the point that most often changes the economics of a project. Since 2022, Article 19 of the Law on Subsoil has required the winner of an auction or tender for a large or medium gold or silver deposit to set up a Kyrgyz company in which the State holds at least 30%, and the licence is issued to that company.

Under Law No. 82 of 6 May 2024, the winner of an auction for large and medium gold and silver deposits is the participant offering the highest price and a share to the State. Investors should model the State's stake from the outset and take advice on how it would apply to their project, including any existing licence.

Transfers and change of control

A subsoil use right cannot simply be sold. Under Article 38 of the Law on Subsoil, a licensee may transfer its licence rights only after two years from the date of the licence agreement, only if it owes no bonus, royalty or subsoil use fee, and only with a guarantee that the new holder will keep to the licence agreement. A transfer counts as obtaining a licence and triggers the bonus, and the licence is reissued under the licensing regulation.

A change in the licensee's participants or shareholders must be notified to the licensing authority in writing, and failure to notify a change that attracts the bonus is a ground for suspending the subsoil use right. Under Article 351 of the Tax Code, a change of shares in the licensee itself attracts the bonus, in proportion to the change, unless the company is listed on a stock exchange or the shares pass by universal succession. The licensee must also report its ultimate owners of 10% or more, direct or indirect, and failure to do so, or false information, is a ground for termination. These points should be conditions of any acquisition, and they should be checked at every level of the holding structure.

Keeping the licence

A licence holder must keep to its obligations throughout the term. The main ones are:

Rights may be suspended for up to three months or terminated for breaches. Late payment of the bonus or licence payments is a ground for suspension, and failure to cure the cause in time is a ground for termination, so payment deadlines need close attention. A pledge of subsoil use rights needs the consent of the licensing authority's commission and must be registered, or it is void, which matters for project finance.

Managing the risk

Foreign investors should assess regulatory and political risk alongside geology. The 2021 state takeover of the Kumtor gold mine is widely cited in this context.

Careful structuring helps. An investor can review whether a treaty protects its investment, and it should think about the dispute clause early. This matters more now, because the 2003 investment law that founded the Stans claim below has been replaced. Under Article 23 of the Law on Investments of 12 August 2025 No. 198, as amended by Law No. 46 of 8 April 2026, a dispute that negotiation does not resolve goes to the Kyrgyz courts, unless there is a written arbitration agreement or a treaty provides for arbitration. Local community relations also deserve early attention, because they often affect a project in practice as much as the licence does.

How disputes have gone in practice

Practical steps

  1. Check the current law. Confirm the rules in force on the date of the transaction.
  2. Identify the route. Establish whether the plot is available, of national significance or on the auction register.
  3. Model the State's stake. For gold and silver, build it into the financial case.
  4. Review the licence history. When buying, check how the licence was first granted, as well as payments, work obligations, violations and earlier transfers.
  5. Plan the transfer. Make the legal conditions for transfer and notification part of the deal.
  6. Engage local communities early. Do not leave this until construction.

Legal basis and sources

Related: Legal Services in Kyrgyzstan · Mining & Metals · Public-Private Partnerships in Kyrgyzstan

This article is general information and not legal advice. To discuss a project, please contact the firm.