Rare earth resources Photo: VCG

China’s Ministry of Industry and Information Technology (MIIT) on Tuesday released a draft outlining how administrative penalties should be applied to violations in rare earth mining, smelting and related activities under the Regulations on the Administration of Rare Earths, and is inviting public feedback.

According to a notice published on the ministry’s website, the draft aims to better implement the regulations, standardize law enforcement in the rare earth sector, and strengthen law-based governance.

The document specifies the legal basis, penalty standards and applicable conditions for six categories of violations. It also introduces a four-tier system for enforcement discretion based on the severity of offenses: no penalty, lenient penalty, standard penalty and severe penalty.

Covered violations include breaches of total quota control rules in rare earth mining and smelting and separation; unauthorized entities or individuals engaging in smelting and separation activities; and rare earth comprehensive utilization enterprises using rare earth mineral products as production inputs.

Other violations include the purchase, processing or sale of illegally mined or smelted rare earth products; failure by enterprises to accurately record and upload product flow data to the traceability system; and refusal to cooperate with, or obstruction of, lawful inspections by regulators.

Penalties may include the confiscation of illegal gains, illicit products and equipment directly used in unlawful activities, along with fines of varying degrees. In serious cases, business licenses may be revoked, the draft states.

Public feedback can be submitted via mail, email or fax through May 28, 2026, according to the MIIT notice.

In recent years, China has introduced multiple policies and measures in aspects including industry entry standards, sector consolidation, and environmental protection, which effectively promoted the sustainable and healthy development of the industry. 

In October 2024, the regulations on rare earth administration in China took effect, aimed at promoting the high-quality development of the rare earth industry while maintaining the safety of national resources and industries.