Cham­ber seeks to block char­ter

The Star Early Edition - - BUSINESS REPORT -

SOUTH Africa’s min­ing com­pa­nies have ap­plied to the High Court in Pre­to­ria to block the Min­ing Char­ter, ar­gu­ing that the new rules would de­stroy the in­dus­try. The Cham­ber of Mines has ap­plied for an ur­gent in­ter­dict that would halt the im­ple­men­ta­tion of the char­ter, pub­lished by the De­part­ment of Min­eral Resources on June 15, it said in a state­ment yes­ter­day. The cham­ber said that it plans to fol­low with an ap­pli­ca­tion to have the char­ter re­viewed. Min­ing com­pa­nies will be re­quired to raise black-own­er­ship lev­els to 30 per­cent un­der the new rules, up from 26 per­cent cur­rently, and pre­vi­ous deals from which black in­vestors have since sold out are not given full credit. That would force many com­pa­nies to sell ad­di­tional stakes, po­ten­tially di­lut­ing ex­ist­ing in­vestors. In its ap­pli­ca­tion, the Cham­ber of Mines said that in its cur­rent form the char­ter would “de­stroy the very in­dus­try whose sur­vival is nec­es­sary” to meet the ob­jec­tives of the coun­try’s min­er­als leg­is­la­tion. It also ar­gues that the char­ter as­sumes pow­ers that re­side with par­lia­ment and con­tra­dicts it­self. “Legal ex­perts them­selves are con­fused and find them­selves un­able to pro­vide clear ad­vice to their min­ing and in­vest­ment clients as to the mean­ing and ef­fect of the 2017 char­ter,” the Cham­ber of Mines said. – Bloomberg

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