FOCUS ON MINING Chamber turns to court for guidance
Clarity sought on ‘once empowered, always empowered’
THE CHAMBER of Mines has asked courts for guidance on how to interpret the ownership clause in the country’s mining charter, a decision that is a test for maturity of the industry.
The Chamber and the Department of Mineral Resources (DMR) announced in March they would jointly approach the court to seek clarity on the contentious “once empowered always empowered” principle of the charter.
In many instances, empowerment partners with whom mines concluded deals after 2004 sold their stakes in the mining companies. The chamber wants recognition for these deals irrespective of the status and value created because the department says its understanding is that deals where empowerment ownership levels have fallen due to disposal of assets should not be included in the progress made.
In a statement on Friday, the chamber said it had gone alone as a joint application suggested some form of an agreement between the parties.
Its chief executive Roger Baxter said the chamber was committed to a joint resolution of the matter with the DMR, but it believed that the differences had to be settled swifly in the interests of the industry and the country.
Not surprising
“The industry and its stakeholders need regulatory certainty in respect of continuing consequences on which basis mineral rights have been granted, and which have been disclosed to shareholders, so as to ensure the sustainability of the industry.”
Mahlodi Muofhe, adviser to Mineral Resources Minister Ngoako Ramatlhodi said on Friday the decision by the chamber to approach the courts was not surprising as the courts were best place to seek clarity.
“It is not as if the relationship between the minister and the stakeholders is now strained as it is a matter of seeking clarity. When the minister finally implements the mining charter there will be no hiccups,” Muofhe said.
Duma Gqubule, the founder of KIO Advisory Service, described the charter as a shameful document.
Gqubule pointed to the lack of a mechanism to independently verify the empowerment contributions of mining companies, the low targets for employment equity and the inability to measure net value attributable to black shareholders as some of the weaknesses in the mining charter.
“I do not understand why so many people are married to a document that has so many gaping loop holes and weaknesses. It betrays key empowerment principles that have been developed over two decades. Most of the charter elements do not have numerical targets or clear definitions to avoid different interpretations by stakeholders,” Gqubule said.
Solidarity general secretary Gideon Du Plessis said the court case was inevitable as both parties were not willing to accommodate each other.
“They must both honour the outcome of the declaratory order so the impasse can be resolved,” Du Plessis said.