Department and Mineral Council should settle out of court regarding ownership and once empowered, always empowered principle

Mining area with excavators

Solidarity today called on the Minerals Council South Africa and the Department of Mineral Resources and Energy to negotiate and reach an agreement out of court regarding ownership and the once empowered, always empowered principle rather than to proceed with further court action. 

This followed after the High Court, in the case between the Minerals Council and the Department regarding ownership as contained in the third Mining Charter and clauses on the once empowered, always empowered principle, recently ruled that trade unions and mining communities should be added as parties to the court proceedings. In response, the Minerals Council argued that the ruling would simply delay legal certainty on these issues. 

Solidarity General Secretary Gideon du Plessis explained:

“The current litigation process between the two parties has divisive consequences and interrupts social cohesion in the mining sector. A court ruling will mean a win-lose situation that will have far-reaching consequences for the loser while relations between all mining role players will be further damaged. For this reason, Solidarity calls on the Minerals Council and the Department to return to the negotiating table to reach an agreement in terms of which both parties will have to give up something.”

According to Solidarity, the uncertainty that comes with a protracted legal battle that could end up in the Constitutional Court has more negative consequences for mining investment than a settlement has that recognizes historic empowerment deals while further empowerment, as contained in the Charter, will still happen to the benefit of especially mineworkers and mining communities. Should the Council be successful in its application, it would mean that mineworkers and mining communities will lose their current 5% ownership allocation (in the form of carried interest). As a result, the legal dispute will be replaced with tension and unrest at the mining level.  

“This is simply a case where the Department’s top leadership and the Council’s top leadership now have to show leadership in the midst of a general leadership crisis in the country,” Du Plessis concluded

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