The minerals council is taking the 2018 mining charter on judicial review over provisions in the policy that it says remain “untenable” it announced in a press statement on Wednesday morning.
The council, which represents around 90% of South Africa’s mineral production, said it had filed an application for the review and setting aside of certain clauses of the 2018 charter published by Mineral Resources Minister Gwede Mantashe in September last year.
Key to the application are provisions in the charter which the industry argues do not fully recognise previous empowerment transactions, particularly regarding mining right renewals and transfers.
The application is aligned to the mineral council’s previously stated view that most aspects of the charter represent a reasonable and workable framework, the council’s chief executive Roger Baxter said.
But the provisions in the charter that do not fully recognise “the continuing consequences of previous empowerment transactions, particularly in respect of mining right renewals and transfers of these rights, remains untenable,” Baxter said, adding that it would severely dampen the attractiveness of mining to investors.
The progress of the 2018 charter was characterised by a fraught negotiations with government and saw the industry at loggerheads with former minister Mosebenzi Zwane over previous iterations of the document. A pivotal issue has been the question of ownership targets — which under the 2010 mining charter were set at 26%.
Under the 2018 mining charter, a mining right holder that has met the 26% ownership target prior to the charter’s commencement is viewed as compliant — even if its empowerment partner has exited the deal. However this so-called “recognition of continuing consequences” does not extend to the renewal of the mining right or when ownership of the right is transferred.
The decision to head to court was “very reluctantly taken” by the council’s board, the statement said, given ongoing attempts “to reach a compromise with the Minister on certain provisions that are problematic for the industry, and which would be detrimental to its sustainability”
Discussions with the ministry are ongoing, and may yet bear fruit according. But given the requirements of the Promotion of Administrative Justice Act (PAJA) — which leaves a 180 day time bar to bring a review application of this nature to court, the council was “obliged to launch the review proceedings” on March 26.
“The minerals council and its members remain fully committed to transformation of the mining sector in South Africa, with the aim of achieving job creation, economic growth, competitiveness and social upliftment and development,” Baxter said.
“But these goals will only be realised through a minerals policy framework that conforms to the rule of law and principles of legality; and by administrative action, which is lawful, reasonable and procedurally fair and consistent in all respects with provisions of the country’s legislation.”