While Minister of Mineral Resources Gwede Mantashe has been praised for his sufficient consultative approach around the new Mining Charter, and for having managed to produce a compromise document, some key stakeholders still need clarity on certain implementation aspects of the revised charter.
Mantashe, who is preferred by the industry to his hawkish predecessor, Mosebenzi Zwane, first finalised the revised charter towards the end of September 2018, and published his final “liberal” document on December 19 for implementation.
Mantashe was tasked by President Cyril Ramaphosa with bringing stability to the mining sector by restoration of trust between the department and all mining stakeholders, after a period of high tension during the Zwane era. Instability was also attributed to protracted and violent strikes and massive retrenchments in the sector.
According to Kevin Pietersen, partner and mining expert at Hogan Lovells in Johannesburg, there are certain requirements which applied from September 29, 2018, the date of publication of the charter, but there are other provisions which dealt with the charter’s commencement being at a later stage.
“The purpose of the implementation guidelines is to assist rights holders with the process and it creates forms and templates that will improve compliance. A further, although minor, amendment to the charter was also gazetted on December 19, 2018,” Pietersen said.
The charter’s implementation was delayed by an intervening court challenge by the Minerals Council of South Africa (formerly Chamber of Mines) and further engagements with role players, coupled with the lengthy legislative processes, including the charter’s publishing.
In 2017, the MCSA filed its court application to challenge the revised charter’s implementation, forcing Mantashe to go back to the drawing board to prepare a “good charter”.
Mantashe published a compromise document in September 2018 that the MCSA welcomed as vastly improved from the earlier charter.
According to Pietersen, the latest revisions requiring existing right holders to top up their BEE ownership from 26% to 30% was removed, which was in line with the high court ruling.
Also, a “carried interest” was introduced in order to recognise the need to involve communities and organised labour. But to encourage Greenfields projects, ownership requirements relating to prospecting rights were removed in the revised charter.