[miningmx.com] – A JOINT effort by South Africa’s Chamber of Mines (CoM) and the Department of Mineral Resources (DMR) to extract High Court opinion regarding the mining charter has been abandoned, the CoM confirmed today.
Instead, the CoM would make a single application to the court – a development it was at pains to point out served better legal process. It did not register a deterioration in its relationship with the DMR, it said.
Said the CoM: “… [I]t has become clear that the legal mechanism available to the parties necessitates a clear applicant and respondent, with an identifiable and clear point of dispute.
“A joint application, by definition, suggests some form of agreement between the parties, resulting in a request for a legal opinion, which is not the function of a court”.
The parties announced in March they would seek a declaratory order from the High Court aimed at settling a difference of opinion between the two regarding the principle of ‘once-empowered, always-empowered’, described by the CoM in its statement as the “continuing consequences” of BEE deals.
The outcome of the declaratory order would have potentially settled a huge difference in interpretation regarding an audit of the mining charter. The DMR thinks the South African mining sector has failed to meet its empowerment objectives, a view it bases on the opinion that extinct empowerment deals are not counted.
“The chamber and its members fully support the transformation objectives of the Mineral and Petroleum Resources Development Act [MPRDA] and have taken meaningful steps to give effect to them,” said Roger Baxter, CEO of the CoM.
“The Chamber remains committed to joint resolution on the matter with the DMR, but we believe that it is in the interests of the industry and the country that this is done swiftly,” he said.
“The industry and its stakeholders need regulatory certainty in respect of continuing consequences on which basis mineral rights have been granted, and which have been disclosed to shareholders, so as to ensure the sustainability of the industry.”
“The DMR will be responding to the application we have made, where after a court date will be determined,” said the CoM in its statement.
“The process is expected to take a number of months. After the court hearing, the judge may take some time to make a ruling, against which either party may appeal,” it said.
“This necessary legal process will not stop us from continuing to engage with the DMR to bring resolution and clarity in a way that meets the needs of all stakeholders,” said Baxter in a statement.
“It is our view that this litigation does not imply a breakdown in the relationship between the chamber and the DMR.
“On the contrary we believe this will strengthen the relationship among the stakeholders,” he said.
In terms of the mining charter of 2004, companies operating in South Africa’s mining industry are required to sell 26% of their shares, or units of production, to a black-owned partner by 2014.
The DMR published figures in May that on an unweighted basis, only 6.3% of some 442 companies that had submitted reports regarding their compliance with the mining charter had met the 26% BEE requirement. On a weighted basis to take account of the sizes of the companies, this figure rose to 20%.
In contrast, and underpinning the difference of opinion, the CoM said its members had an average empowerment level of 38%.
