A BID to consolidate a legal case declaring South Africa’s Mining Charter unconstitutional with an unrelated court application regarding the document by the Chamber of Mines (CoM) has been dismissed by the country’s High Court.
Malan Scholes, an attorneys, has argued that the Mining Charter is shot through with inconsistencies whilst in other respects it lacks definition. Over-arching these arguments, however, the attorneys says the Mining Charter is the voice of policy and not law. It wants the Mining Charter to be declared unconstitutional.
In order to support this effort, Malan Scholes sought to have its legal bid consolidated with legal process brought to bear by the CoM in the High Court.
The CoM is seeking a declaratory order from the court on the matter of ‘once-empowered, always-empowered’ which is a principle it supports because it makes original empowerment deals binding even if they fail, or in the event empowerment partners, if they sell their shares. The CoM calls this principle the ‘continuing consequences’ of empowerment deals.
The Department of Mineral Resources (DMR), however, wants mining firms to accept that the Mining Charter’s targets, such as the transfer of 26% of mining shares to historically disadvantaged South Africans, to be perpetual. In other words, in order to be compliant with the charter, companies always have to maintain that level of empowerment.
“The Chamber opposed the consolidation of the action by Malan Scholes on the grounds that it does not seek determination of substantially the same questions of law or fact,” said the CoM in a statement on Tuesday evening.
“While the Scholes application argues that the Mining Charter is unconstitutional and invalid, the Chamber’s application does not make that argument,” it added.
It said it was “pleased” that the application by Malan Scholes to consolidate its case with its application, which was heard in the Pretoria High Court by Judge Rabie on 15 March 2016, had been dismissed, with costs.
“The industry has been, and continues to be, committed to the achievement of all the transformation objectives of the Mining Charter currently in place, but does however seek clarity on the interpretation of one critical issue related to the continuing consequences of empowerment transactions,” said the CoM.
One of the major reasons the CoM didn’t want the consolidation is that it would have completely polarised the debate regarding empowerment with the DMR.
Since then, however, the DMR has introduced a new Mining Charter in draft form which seeks to enshrine perpetual empowerment – a move which seems designed to render the CoM’s court application redundant.
