The overdue Mining Charter III has been approved by the South African Cabinet, under the leadership of President Cyril Ramaphosa. In addition, Cabinet has also approved the withdrawal of the MPRDA Amendment Bill.
NPI Governance Consulting CEO, Israel Noko, has said that “Under the current technical recession, creating a balance in meeting the commercial needs of the private sector and addressing socio-economic challenges of South Africa was going to be an uphill battle.” The mining industry will still need to be finalised and gazetted to fully understand the amendments made. However, as part of SA’s Government strategy to stimulate the economy (and probably to appease the global ratings agencies), Noko adds that “It is clear that Mining Charter III is being gazette in a way that it promotes foreign direct investment into the country”.
Many foreign investors have been closely watching the economic developments since President Ramaphosa has taken over from the previous regime. A notable fact is that it appears that the trickle dividend of a minimum of 1% of EBITDA to community and employee shareholders has been scrapped. However, the 30% Black ownership requirements have remained, mining right holders who secured mining rights prior to the new Charter being gazette will not have to immediately comply with the new ownership percentages. 2017’s Mining Charter gazetted under the leadership of the former President Jacob Zuma, saw the introduction of a free carried interest. It is likely that this provision will be conceded in the final Charter.
For more information please contact:
Tel: +27 (0) 11 259 4016
Cell: +27 (0) 76 754 6390
ABOUT NPI GOVERNANCE CONSULTING
NPI Governance Consulting is a niche ISO9001 accredited B-BBEE & Economic development Advisory and Project Management practice. The company is a trusted transformation advisor to local and multinational companies, and international investors. NPI Governance Consulting an advocate for sustainable economic growth and strategic transformation intelligence.
NPI Governance Consulting delivers end-to-end B-BBEE service to all market sectors through business advisory, consulting and project management functions. With a team of experienced specialists, the company guides and supports clients- ensuring the delivery of quality solutions.