AMN - Mining charter challenge delay the right decision - comment by Yolanda Torrisi

A court decision to postpone the South African Chamber of Mines application to challenge the country's proposed new mining charter is fair. It enables more time for deliberation of regulations that appear to have been made without due consultation, particularly with those it will affect most - the mining community.

Late last year the court decided to defer the application to February 2018.

The chamber is seeking to prevent the implementation of the charter, which increases the minimum threshold for black ownership of mining companies to 30%, claiming there was no consultation.

A chamber spokesperson said, “The Chamber of Mines met with the judge. The judge raised the issue of whether two days would be sufficient times for the hearing, which is a complex matter.”

Uncertainty around the charter is deterring investment into a sector that accounts for 8% of South Africa’s economic output.

The government initiated mining charter is part of a wider empowerment drive in South Africa designed to rectify the disparities of apartheid that persist more than two decades since its demise in 1994.

The Chamber of Mines has filed a court application to challenge the revisions, which it says were imposed without consultation. It also says that many of the new rules are unaffordable for an industry grappling with depressed prices and rising costs.

The chamber says about two-thirds of platinum mines in the world’s largest producer of the precious metal are not making money at current prices.

Major areas of contention include raising the target for black ownership to 30% from 26% and a stipulation that mining companies must pay 1% of their annual turnover to the Mining Transformation and Development Agency, which helps black communities.

The country's Mineral Resources Minister Mosebenzi Zwane says the chamber's application to challenge the mining charter is regrettable as it will delay transformation.

Yolanda Torrisi is Chairperson of The African Mining Network and comments on African mining issues and the growing global interest in the continent. Contact:yolanda@yolandatorrisi.com