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South Africa to appeal court ruling on black ownership of mines

4th May 2018

By: Bloomberg

  

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South Africa has sought leave to appeal a court judgment earlier this month on a crucial black-ownership principle in the country’s Mining Charter, the nation’s mining lobby said.

The Chamber of Mines has been notified that Mineral Resources Minister Gwede Mantashe and the Department of Mineral Resources (DMR) filed the application, it said in a statement last week. The High Court in Pretoria ruled on April 4 that the first two versions of the country’s charter did not require producers to top up black-shareholding levels in perpetuity if they previously met the minimum 26% requirement.

A copy of the application provided by the chamber is dated April 19.

“The chamber is currently reviewing the specified grounds of appeal, although the DMR’s appeal appears to centre on the majority judges obiter dictum comments about the legality of the 2010 charter and the enforceability of the charters,” the lobby group said.

The development is another volley in a long-standing legal battle to clarify the charter rules. The case was revived last year by the chamber, which sought a declaratory order on the so-called ‘once empowered, always empowered’ principle. The group has argued that companies can reach the black-ownership requirements by counting previous sales to black investors, even if those investors later sold their shares to whites or foreigners.

The DMR did not immediately respond to an email and a call seeking comment.

Mineral Reserves
South Africa has the world’s biggest reserves of platinum and manganese, and its mineral deposits also include gold, iron-ore, coal, chrome and zinc. Anglo American, Glencore and South32 are among companies operating in the country.

Malan Scholes, a Johannesburg-based law firm, has made a separate application to declare current and previous charters unconstitutional because they lacked definition and were inconsistent. The chamber opposes the view that the 2004 and 2010 charters are not valid and has agreed to join as a respondent to that application, it said.

Mantashe is holding talks with the industry, unions and mining communities on a new charter, a set of rules aimed at distributing the wealth of the industry more widely. He said early last month that he was confident that work on the charter would be concluded in May.

• See also page 20.

Edited by Bloomberg

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