South Africa seeks court decision on mining black ownership rule – by Zandi Shabalala (Reuters U.K. – March 31, 2015)

http://uk.reuters.com/

PRETORIA – (Reuters) – South Africa’s mines ministry and the industry have agreed to ask the courts to help them resolve a dispute over a black ownership target of 26 percent for mining companies, the two sides said on Tuesday.

Mines minister Ngoako Ramatlhodi said there was “no consensus” on the issue as he gave details from an assessment of how the industry has complied with the targets set out for it in a state charter aimed at redressing the imbalances of white apartheid rule which ended two decades ago.

The main sticking point is the industry contention that once a company is 26 percent black-owned, it has effectively complied, even if some of the black shareholders then sell out. The government says companies must retain the 26 percent ratio as an absolute minimum.

Failure to meet the targets can result in mining permits or rights being revoked in an industry which is an increasingly hard sell to foreign investors in the face of often violent labour unrest, depressed prices and soaring wage and power costs.

South Africa’s Chamber of Mines said it had agreed with the ministry to approach the courts on the ownership target issue “in order to break the impasse, and to avert any confusion that may be damaging to investor perceptions”.

“The industry believes the Mining Charter does not require of mining companies to maintain 26 percent ownership once it has been achieved,” it said in a statement.

For the rest of this article, click here: http://uk.reuters.com/article/2015/03/31/uk-safrica-mining-charter-idUKKBN0MR1KF20150331

Comments are closed.