Chamber of Mines goes to court
THE CHAMBER of Mines, which represents the South African mining industry, made a court application to block the mines minister’s proposal to freeze granting and renewing mining rights, intensifying a legal clash between the two sides.
The lobby group issued the application with the Pretoria High Court “to review and set aside the notice and to interdict the minister from taking any decision or issuing any directive contemplated in the notice,” it said in a statement yesterday.
The objection is part of the industry’s battle against a controversial new Mining Charter published last month.
A legal battle with industry began after Mines Minister Mosebenzi Zwane issued the country’s latest charter, which would require mining assets in South Africa to be 30 percent blackowned, up from 26 percent, and previous deals from which black investors have since sold out are not given full credit, raising concerns about dilution for existing investors.
The chamber moved to block the charter in a case due to be heard in September.
Zwane has said a rights freeze proposed last week is necessary to ensure that no rights are approved without being subject to the new charter regulations, which he has agreed to suspend pending an initial court judgment. The public has until August 4 to respond to the moratorium notice.
The lobby group said it has been advised that the separate moratorium notice was unlawful, because it would damage the mining sector and exceeds the minister’s powers.
The urgent application to set the notice aside will be heard on the deadline for public comment.
Meanwhile, Zwane yesterday welcomed a court ruling which affirms the legitimacy of the government’s authority to monitor the movement of unpolished diamonds.
The ruling was a positive move for the advancement of transformation of the mining industry, Zwane said.
The Constitutional Court on Monday declined to confirm a high court order which declared that a section of the Diamond Act was unconstitutional.
Section 20A of the Act, which was put in place in 2007, stated that no licensee may be assisted by a non-licensee during the viewing, purchasing or selling of unpolished diamonds at any place where unpolished diamonds are offered for sale, except at diamond exchange and export centres.
The South African Diamond Producers Organisation approached the High Court in Pretoria earlier this year to declare the section unconstitutional.
The organisation complained that producers and dealers were deprived of 30 percent of the market value of diamonds they sell due to Section 20A of the Diamond Act, which prohibits a key part of the price-forming mechanism: the unlicensed expert assistance.