SOUTH African mines minister, Mosebenzi Zwane, has argued in an answering affidavit submitted to the Pretoria High Court that the Mining Charter was not aspirational, and that the law enabled the Department of Mineral Resources (DMR) to reset its targets.
Zwane also countered claims by the Chamber of Mines in its founding affidavit that it had not been consulted on the redraft of the new Mining Charter, saying the industry body had been afforded more meetings than any other stakeholder with some 17 “substantive meetings and engagements” between March 2016 and March 2017.
The affidavits by the DMR and the Chamber were filed in an effort to interdict a proposal by Zwane that he suspend new prospecting and mining license applications in terms of discretional rights granted to the minister in the Minerals & Petroleum Resources Development Act (MPRDA).
In the end, Zwane said he would not press ahead with the suspension and would seek other legal means to achieve economic transformation in the South African mining sector.
However, the High Court judge ordered Zwane to lodge an answering affidavit in any case as per his legal obligations. He said Zwane had disrespected South Africa’s Constitution. Zwane reasoned the delay in his answering affidavit was owing to the complexity of response required and because he was traveling on important bilateral business. He had travelled to the Central African Republic where a Memorandum of Understanding in respect of mining industry cooperation was signed.
Zwane used the opportunity of the answering affidavit to launch the DMR’s firmest counter attack yet to events of the last two years, especially a redraft of the Mining Charter which he defended. Filed on August 7, the affidavit came on the eve of a potentially momentous day in South Africa’s Parliament which is the participate in a secret vote of no confidence in President Jacob Zuma.
Zuma controversially appointed Zwane in September 2015 in which then incumbent Ngoako Ramatlhodi was replaced. Ramatlhodi, who has since resigned as a Member of Parliament, said earlier this year he had been pressurised by Eskom executives whilst mines minister to suspend the mining license of Glencore to operate Optimum Coal Mine in an effort to make it available for Tegeta Exploration – a claim rejected by former Eskom chairman, Ben Ngubane. Tegeta, a company owned by the Gupta family, eventually bought Optimum Coal Mine out of business rescue.
In the affidavit, Zwane contends that the Chamber is merely attempting to block economic transformation and its claims that the redraft of the Mining Charter knocked R50bn off mining shares was unfounded as this does not expose any unlawfulness in the document. Zwane said short-term sales of shares after policy changes is normal. “The applicant’s allegations of reasonable apprehension of harm are overstated,” he said.
“The Mining Charter was never meant to be an ‘aspirational document’ as is suggested by the applicant,” said Zwane in the answering affidavit.
“At the time of the drafting of the MPRDA and in particular section 100(2) thereof, the legislature contemplated that the Charter would be a convenient and flexible mechanism enabling the Minister to respond to a fluid and constantly evolving situation regarding methods for the achievement of the relevant objects set out in the MPRDA,” he said.
“The intention was that, over time, as it was discovered that some aspects of the Charter worked and others did not, the Minister could – effectively and relatively expeditiously – give effect to section 100(2) and some of the key objects of the MPRDA,” he said.
The view of the African National Congress is the the Mining Charter ought to be revisited, although there’s no clear sight of how this will be achieved while Zwane is minister. The mining industry has described the Mining Charter variously as “confused” (Mark Cutifani, CEO of Anglo American) and “shabbily drafted” (Steve Phiri, CEO, Royal Bafokeng Platinum). The Chamber’s CEO, Roger Baxter, said the Mining Charter was unworkable.