The National Development and Reform Commission and two other regulators have jointly released the Circular on Regulating the Production of Coal Mines to Restrain Them from Production over Capacity (the "Circular").
The Circular requires all coal mines to organize production according to the capacity they have registered and announced and the commitments they have made, and develop yearly, quarterly and monthly production plans reasonably. It is provided that the annual output of raw coal in a coal mine shall not be greater than its registered capacity, and the monthly output shall not be greater than 110% of the average derived from its monthly plans, or not be greater than 1/12 of the registered capacity in the absence of the monthly plans. Any coal mine whose production is over its capacity in violation of the rules shall be ordered to halt the production for rectification, cause its work safety licence and the qualification certificate for the mine director to be seized, and be imposed a fine of between CNY500,000 and CNY2 million on the part of the mine, or a fine between CNY30,000 and CNY150,000 on its head. The Circular also requires all mines that have been established and have begun production without approval to be suspended, and all mines that have not obtained the mining licence and the work safety licence to be banned.