2001

South African Mining Bill Draft Draws International Criticism

April 2001

South Africa’s draft Mineral Development Bill is being questioned and criticized by not only native mining companies, but also the Canadian mining industry.

Critics charge that the bill, which proposes putting all mineral rights in the hands of the state and allegedly strips mining companies of their right to hold onto existing mining operations, may be unconstitutional.

According to South African mining companies, the bill will discourage foreign investment in mining--the industry which accounts for nearly a third of South Africa’s economy.

Under the bill, not only must new mining prospects be approved by the South African government, but existing operations would have to reapply for their right to mine within five years. The bill also proposes an export duty on diamonds that may be in conflict with World Trade Organization rules.

Critics argue that the bill does not allow for appeal or challenge to a decision. They also question what they are calling vague wording that may indicate the expropriation of mining rights without compensation.

The Department of Mineral and Energy Affairs wants to have the legislation in place by the end of 2001.