MAC/20: Mines and Communities

Proposed Socio-Economic Empowerment Charter for the SA Mining Industry

Published by MAC on 2002-06-15

Proposed Broad-Based Socio-Economic Empowerment Charter for the South African Mining Industry

[Issued by the Government of South Africa. June 2002]




The signatories have developed this Charter to provide a framework for progressing the empowerment of historically disadvantaged South Africans in the Mining and Minerals Industry.

1. Scope of Application

This Charter applies to all parts of the industry and to all parts of the value chain, inter alia:

2. Interpretation

For the purposes of interpretation the following terms apply:

3. Objectives

The objectives of this charter are to promote sustainable development and growth through minerals and energy resources for the benefit of all South Africans by:

4. Undertakings

Member companies and government undertake to create an enabling environment for the empowerment or ADSA's by subscribing to do the following:

4.1 Human Resources Development

The South African labour market does not produce enough of the skills required by the mining industry. Organised industry and government and other stakeholders shall work together in addressing this skills gap in the following manner:

4.2 Employment Equity

Companies shall publish their employment equity plans and achievements and subscribe to the following:

4.3 Migrant Labour

Government and industry undertake to:

4.4 Housing and Living Conditions

Government and industry, in consultation with the Mine Health and Safety Council, the Department of Housing and organised labour, undertake to:

4.5 Private Sector Procurement

Participants in the industry shall subscribe to and adopt supportive procurement policies to facilities and leverage the growth of HDSA companies. Such policies include criteria that favor HDSA companies.

4.6 Public Sector Procurement

Government will engage with State Tender authorities to draw their attention to the Petroleum and Mineral Resources Development Bill milestones with respect to economic empowerment of historically disadvantaged South Africans, with the aim of giving effect to supportive procurement policies within this sector.

4.7 Ownership and Joint Ventures

Government and industry undertake to negotiate the transfer of ownership of at least 51 % of mining industry assets to HDSA's, within the next ten (10) years. Ownership could be subdivided into two categories, namely, Class A and Class B.

Class A: These are ventures that involve deposits that have significant reliable markets and revenue, are in abundance and its ores are easily beneficiated.

Class B: These are very risky / marginal ventures which for various reasons such as those that involve very deep deposits, deposits with unreliable markets or the assets are too small to make a significant impact. This class is not considered as real empowerment. Government undertakes through the Council for Geoscience, to compile a register of potential mining projects from old exploration and mining records. These will then be made available to HDSA companies.

Mining companies undertake to make available to Black Economic Empowerment companies those deposits that for various reasons do not fit into their business plans. Mining companies undertake to form joint ventures that include a wide spectrum of previously disadvantaged people, such as women, the disabled and host communities.

Mining companies undertake to make available to their HDSA in their employ share option schemes so that they can play a meaningful role in the industry.

4.8 Beneficiation

Recognising that most minerals are of little value in the ore condition, the ore must be beneficiated to yield a product that is useful to industry, mining companies undertake to fully involve HDSA's in the control and management of the beneficiation facilities listed below:

4.9 State Assets

Government undertakes to deal with state assets in a manner that promotes the objectives of the Minerals and Petroleum Resources Development Bill and this Charter.

4.10 Licensing

Government undertakes to consider the following before issuing new licences and converting old rights to new ones:

4.11 Financing Mechanism

Industry participants:

4.12 Regulatory Framework and Industry Agreement

Government's regulatory framework and industry agreements shall strive to facilitate the objectives of this Charter.

4.13 Consultation, Monitoring, Evaluation and Reporting

It is recognised that the achievement of the objectives set out herein entails an ongoing process. The Government conducts an annual survey of the industry to evaluate progress in achieving the objective of the Minerals and Petroleum Resources Development Bill. Companies shall submit such data as is required at the end of each year, including employment equity data, procurement targets, etc.

The aggregated information is published and forms the basis of the annual forum. Parties hereto participate in annual forums for the following purposes:

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