Picture: ISTOCK
Picture: ISTOCK

The Department of Mineral Resources remains steadfast in its belief that mining companies have to maintain their black ownership levels, even if it means being tied into long-life projects, and the onus is on mining right holders to ensure they retain empowerment levels.

In the first of two court battles between the department and the Chamber of Mines, the parties argued the merits of their cases in seeking a declaratory order around whether mining companies could count on historical empowerment deals that were no longer in place or whether the department’s view of the first two Mining Charters held sway that companies had to perpetually top up their black ownership structures to at least 26% ownership.

The day was dominated by the chamber’s senior counsel, Chris Loxton, who argued that there were no provisions in the act for perpetual top-ups of empowerment deals to maintain the 26% ownership level and that the second charter sought to apply conditions retrospectively on agreements underpinning already issued mining rights.

The department’s Ishmael Semenya did not concede an inch on questions from judges Peter Mabuse, Thina Siwendu and Frans Barrie about the transfer of wealth to empowerment partners when they sold their mining stakes.

"Those who are going to participate in this kind of enterprise know there is a set-aside for them under this charter and they are a privileged few who have vendor finance, but they must ride the animal they have," Semenya said.

In the case, one of the arguments was whether the charter was merely a policy document or could be enforced using provisions of the act to penalise noncompliance with the document, which maps out the transformation of the historically white-owned industry.

seccombea@bdfm.co.za

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