SA Govt signals reform intent after ending ‘once-empowered, always-empowered’ chestnut

Gwede Mantashe, mines and energy minister, South Africa

THE South Africa government has provided evidence it finally intends to address regulatory uncertainty in the mining industry by dropping a Supreme Court appeal that contended an earlier ruling supporting ‘once-empowered, always-empowered’.

The High Court found in a dispute between the Minerals Council SA and the Department of Mineral Resources and Energy (DMRE) that holders of a mining right seeking renewal or the buyers of a right were not required to transact new empowerment deals.

In other words, an original empowerment transaction attached to a mining right, once it met the precepts of the Mining Charter, did not have to be repeated.

That decision was subsequently taken to the Supreme Court by mines and energy minister, Gwede Mantashe, after failing to reach an out-of-court agreement.

Today’s development sees the DMRE drop its appeal.

The Minerals Council SA welcomed the decision by the DMRE to end its appeal, saying it provided regulatory certainty.

Crucially, the decision is a signal that the South African government is serious about addressing economic policy reform of which regulatory disputes of the ilk of ‘once-empowered, always-empowered’ is but one (crucial) element.

Roger Baxter, CEO of the Minerals Council, was quoted by Miningmx last week as saying visible signs of government’s intention to bring about economic reform would be within six months.

“Hand on heart, we have done our utmost to explain how to get the South African economy back on track,” he said Baxter in a presentation outlining the mining industry’s role in B4SA’s presentation to Government.

“We hope they will be taken forward. We will see in the next six months.”

The Minerals Council said today it and Mantashe, have “… long expressed the hope that this entire matter can be resolved through engagement rather than through the courts”.

“The Minerals Council recognises that inclusive transformation is a key imperative for the mining industry as a whole, and will continue to engage with the Minister and his team on how this can best be achieved.

“This step by the Minister is welcomed as it advances the goal of achieving much-needed regulatory certainty in the sector,” it said.

2 COMMENTS

  1. This is not a change of heart as relates to economic policy, don’t be so naive. As a matter of law the DMRE was going to be hit for six by the SCA – they never had a chance. They were going to lose, they must have been advised of this repeatedly by even the most junior counsel.

    A mining right once granted is a “real” right – the conditions under which it was granted can’t be retroactively changed. That is exactly what the dodgy Mining Charter III wanted to do.

  2. Well done for seeing sense Gwede, please keep u the momentum with other pragmatic change so our little economy can recover a bit!

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