The Zambian government has seized control of a Chinese-owned coal company due to poor compliance with safety and environmental standards, the mines minister said Wednesday.

"Collum Coal mine has had a history of poor safety, health and environmental compliance," Mines Minister Yamfwa Mukanga said in a statement.

"In view of this, my ministry has with immediate effect cancelled all three small scale mining licenses held by Collum Coal Mine."

"Government has also taken over the running of the mine and will continue to run them until a suitable investor is found."

The mine -- located in Sinazongwe, some 325 kilometres (200 miles) south of the capital Lusaka -- has in the past few years been embroiled in controversy.

In 2010 two Chinese managers were charged with attempted murder after they allegedly opened fire on a group of protesting miners. The charges were later dropped.

In 2012 workers at the mine killed a Chinese manager Wu Shengzai during rioting over work conditions.

Police said Wu died after being hit by a trolley which was pushed towards him as he fled underground.

One miner was charged over his death.

China, which is the largest foreign investor in Zambia, has invested more than two billion dollars into the copper-rich southern African nation and created 50,000 jobs.

Trade between the two countries reached $3.4 billion last year, up from $2.9 billion in 2010, Beijing's ambassador to Lusaka Zhou Yuxiao said last year.

But relations between Zambian workers and Chinese businesses have been marked by tension, despite attempts by the Zambian government to remedy the situation.

In October last year Human Rights Watch raised concern about safety and work conditions at Chinese-owned facilities in the country.

It claimed four Chinese state-owned firms ignored labour protections, demanding up to 18 hours of work a day and flouting health and safety rules.

When running for office President Michael Sata railed against the growing Chinese presence in Zambia.

However, Sata has softened his tone since coming to power in 2011.

That has drawn ire in a country where about 60 percent of the population lives on less than $1.25 a day.

"President Sata ran on a populist campaign to protect workers, so the lack of meaningful progress in the mining sector is disappointing," said Daniel Bekele, Africa director at Human Rights Watch.

In addition to safety worries at Collum, the mine had not been paying mineral royalties, minister Mukanga said.

"The company has also failed to meet statutory obligations such as declaration of mineral production and payment of mineral royalties to government," he said.