Trade union Solidarity said on Wednesday that the controversial Reviewed Mining Charter must be set aside, saying that it was discriminatory, unlawful and unconstitutional, and that it would be “devastating” to the mining industry.

Solidarity will act as friend of the court in support of the Chamber of Mines when the application by the Chamber to review and set aside the implementation of the Charter is heard from 19 to 21 February at the North Gauteng High Court.

Anton van der Bijl, head of Solidarity’s Centre for Fair Labour Practices, said the union had to join the Chamber of Mines in the battle to counter the devastating impact this charter would have on the mining sector. 

“Solidarity’s role is to provide information to the court and to support the Chamber of Mines by way of its expertise,” Van der Bijl said at a conference in Pretoria on Wednesday.

Van der Bijl said that the latest Charter was discriminatory, unlawful and unconstitutional and that, for those reasons, it needed to be revised and set aside.

The Charter sets new black ownership targets for the industry, including that new mining rights holders have 30 percent black ownership shared among employees, communities and black entrepreneurs

“The consequences and impact this charter will have on the South African economy as a whole and the mining industry in particular are counterproductive given the Charter’s declared objectives. Acceptance of the Charter would thus be irrational,” Van der Bijl said.

Van der Bijl also said that the Charter contains several clauses that raise concerns, for example the fact that one percent of turnover must be paid to black economic empowerment (BEE) shareholders as a special dividend.

He said that the mining sector’s total dividends amounted to R6 billion in 2016, and percent of the turnover amounted to R5,7 billion. This implies that 95 percent of the dividend value would have to be paid to the 30 percent of BEE shareholders, Van der Bijl said. 

“The impact on the other shareholders’ share value will be far-reaching. The way in which investors have reacted to the Charter has already created uncertainty which has put a damper on mining activities.”

 – African News Agency (ANA)