The Mineral resources minister Gwede Mantashe on Thursday presented a revamped mining charter with a raft of legislative changes including prescriptions for black ownership, aimed at improving the South African industry to better the lives of workers, junior miners, small suppliers, and mining communities.
Under this latest version of mining regulations being gazetted on Thursday, Mantashe said existing mining right holders who achieved a minimum of 26% black ownership in their ventures were recognised as compliant for the duration of the right, but not the life of mine.
“The right holder will be expected to increase their minimum BBBEE (broad-based black economic empowerment) shareholding to 30% within five years,” Mantashe said.
“A new mining right granted after the coming into effect of the Mining Charter 2018 must have a minimum of 30% applicable for the duration of the mining right.”
Mantashe said the charter was not perfect and would not make all stakeholders happy, but was a consensus that everyone could live with after intensive engagements with mining companies, financial institutions, the legal fraternity, investors, mining communities, and the cabinet.
He also confirmed that he had submitted a formal request to the speaker of Parliament to withdraw the controversial Minerals and Petroleum Resources Development Amendment Bill, meaning the current act remains applicable while a separate regime for oil and gas is being developed.
The revamped mining charter was “an important contributory element to efforts aimed at stimulating the economy”, he said.
“It aims to create regulatory certainty, sustainable growth, and a competitive and transformed mining industry. The elements of ownership and mine community development are ring-fenced, and they require absolute compliance at all times,” Mantashe said.
The new black economic empowerment (BEE) shareholding structure will require mining companies to set a minimum of 5% non-transferable carried interest to qualifying employees, the same amount or a minimum 5% equity equivalent benefit to host communities, and a minimum of 20% share ownership to a BEE partner of which a 5% minimum must preferably be for women.
In terms of employment equity, the charter requires companies to achieve a minimum of 50% black representation at board and executive management level, of which 20% must be women; 60% black senior and middle management, of which 25% must be women; and 70% junior management with 30% being women; while employees with disabilities should constitute at least 1.5%.
“A mining right holder must achieve a minimum threshold of historically disadvantaged persons that reflects the provincial or national demographics at a board, executive management, senior management, middle management, junior management, core and critical skills, as well as employees with disabilities,” Mantashe said.