Govt drops Supreme Court appeal over black ownership targets in mining companies

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Minister Gwede Mantashe (Gallo Images/Business Day/Freddy Mavunda)
Minister Gwede Mantashe (Gallo Images/Business Day/Freddy Mavunda)
Business Day/Freddy Mavunda

The Department of Minerals Resources and Energy has withdrawn an appeal it lodged at the Supreme Court of Appeal, aimed at challenging a ruling regarding the BEE ownership threshold of mining companies under the provisions of the Mining Charter.

The increasing of a black ownership requirement by mining companies from 26% to 30% had been a bone of contention between the department and the Minerals Council, with the High Court in 2018 issuing a declaratory order against the clause.

The Council, which represents mining houses, had argued that the top-up provision was unconstitutional and would discourage investment in the sector.

The Council praised the move by the department to abandon the appeal process, saying it "advances the goal of achieving much-needed regulatory certainty in the sector."

It stated that the decision would not have an impact on a separate application for a review of the 2018 Mining Charter’s provision that recognition of continuing consequences would not apply in the cases of transfer or renewal of mining rights.

"That matter is still in progress in the High Court."

The April 2018 declaratory order by the South Gauteng High Court held that black economic empowerment ownership transactions should continue to be recognised for regulatory certainty purposes and for the duration of the mining right, even where the BEE partner has sold or transferred part or all of its equity.

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