Author: Gary Moore

Date: 1 March 2017

The Mineral and Petroleum Resources Development Act, 2002[1] will probably be amended by a 2013 Amendment Bill.[2]

The Bill will (among other things[3]) amend the principal Act’s measures governing mineral beneficiation in the Republic:[4] The amended provision will be to the effect[5] that the Minister[6] may designate any mineral[7] for local beneficiation “in consultation” with “a Minister of the relevant national departments.”[8]

The meaning of the provision is unclear:

The provision states the Minister may designate a mineral “in” consultation with another Minister, and not “after” consultation with him.

Where a law requires a functionary to act “in” consultation with another functionary, this usually means the other functionary must agree to the proposed action. In contrast, where a statute requires a functionary to act “after” consultation with another, this merely requires that the first functionary give the other’s views due consideration.[9]

Perhaps the intention is indeed that the Minister can designate a mineral merely “after” consultation. (The explanatory memorandum to the Bill states that the new measures provide that the Minister may designate minerals for local beneficiation “after” consultation with Ministers of relevant departments.[10])

The designation of a mineral for local beneficiation is a matter appropriate for the Minister of Mineral Resources to decide. It is difficult to find good reason for requiring that other Ministers must concur, particularly in light of the provision’s lack of clarity about who is “a Minister of the relevant national departments.”

One is driven to conclude that the provision is impermissibly vague:

Laws should be written in a clear and accessible manner. A power must not be so vague that the authority to whom it is delegated is unable to determine the scope of the powers conferred.[11] This need for precision flows from the Rule of Law.[12] A provision which is significantly uncertain is probably constitutionally impermissible.[13]

The Bill will also amend the principal Act’s measures relating to the Minister’s power to prohibit or restrict prospecting or mining:[14] The amended provision will be to the effect that the Minister[15] may[16] “as and when the need arises” and having regard to the “national interest” and the “strategic mineral”[17] in question—[18]

Prohibit or restrict the granting of a prospecting right or mining right or permit[19] over land identified by the Minister;[20] or

Restrict the granting thereof[21] for a specific mineral[22] identified by the Minister,[23]

for such period and on such terms[24] as the Minister may determine.[25]

This will leave any decision to prohibit or restrict prospecting or mining[26] to the discretion of the Minister:

The provision contains no parameters for determining “when the need arises;”

The Act does not define the “national interest;”[27]

the Act does not define “strategic minerals” (except baldly as “such minerals as the Minister may declare to be strategic minerals”[28]);

the provision contains no criteria to guide the Minister in identifying land over which a grant of a prospecting or mining right or permit[29] may be prohibited;[30]

it contains no criteria to guide the Minister in identifying a mineral for which the grant of a such a right or permit may be restricted;

the Act contains no criteria to guide the Minister in determining the period for which the grant of a right or permit may be prohibited or restricted;[31] and

it contains no criteria to guide the Minister in determining the terms[32] on which the grant of a right or permit should be prohibited or restricted.[33]

A broad discretion may be legitimate where factors relevant to a decision are too varied for the legislature to identify in advance.[34] But this does not apply. It should not be impossible to define when a need might arise, or the national interest, or strategic minerals. It should also be possible to lay down criteria to govern the identification of land or minerals and the determination of periods when, and terms[35] on which, grants of rights and permits will be prohibited or restricted.[36])

The Rule of Law requires that a discretionary power (such as this power of the Minister to prohibit or restrict the grant of prospecting or mining rights in respect of land or minerals that the Minister may identify) should not be so broad that the authority on whom it is conferred is unable to determine the scope of his power, for this may lead to arbitrary exercise of the discretionary power.[37] The legislature is under a duty to pass legislation that enables officials to understand what is expected of them.[38]

If discretionary powers contain no express constraints, those affected by the exercise of the broad powers[39] will not know what is relevant to the exercise of the powers or in what circumstances they are entitled to seek relief from an adverse decision.[40]

[1] Mineral and Petroleum Resources Development Act 28 of 2002 (the “principal Act” or the “Act”).

[2] Mineral and Petroleum Resources Development Amendment Bill 15D of 2013 (“Amendment Bill” or “Bill”).

The Bill has been passed by both Houses of Parliament, and been referred to the House of Traditional Leaders for consideration of some aspects. It is anticipated the Bill will then be submitted to the President for signature.

The Bill envisages that on enactment its short title will be the Mineral and Petroleum Resources Development Amendment Act, 2014. Bill cl 84.

[3] The Bill will amend more than 70 sections of the principal Act, repeal another 14 and insert 16.

[4] Mineral and Petroleum Resources Development Act s 26.

[5] The provisions are not clearly drafted. The Bill has been altered by parliamentary committees.

[6] Minister of Mineral Resources.

[7] Or mineral product.

[8] Mineral and Petroleum Resources Development Act s 26(2)(a), as amended by Bill cl 21.

[9] McDonald & others v Minister of Minerals & Energy & others 2007 (5) SA 642 (C) par 18D; Unlawful Occupiers of the School Site v City of Johannesburg [2005] 2 All SA 108 (SCA) par [13].

[10] Memorandum on the Objects of the Bill, para 2.5.

[11] Affordable Medicines Trust and Others v Minister of Health of RSA and Another, 2005 (6) BCLR 529 (CC) para [108].

[12] President of the Republic of South Africa and Another v Hugo 1997 (6) BCLR 708 (CC) para [102].

[13] Bertie Van Zyl (Pty) Ltd v Minister for Safety and Security 2009 (10) BCLR 978 (CC) para 103. The Law of South Africa vol 5(3) 2 ed repl vol, D W Freeman “Constitutional Law: Structures of Government” par 26.

[14] Mineral and Petroleum Resources Development Act s 49.

[15] After consulting a Minister of a relevant state department. (This would require that the views of the Minister consulted merely be given due consideration, not that this Minister should concur.)

[16] By notice in the Gazette.

[17] Or petroleum.

[18] And the need to promote sustainable development of the nation’s mineral and petroleum resources.

[19] Or reconnaissance permission or permit, technical co-operation permit, or exploration or production right.

[20] Mineral and Petroleum Resources Development Act s 49(1)(a), as amended by Bill cl 37.

[21] I.e., of any prospecting right or mining right or permit (or reconnaissance permission or permit, technical co-operation permit, or exploration or production right).

[22] Or class of minerals, or petroleum or form of petroleum.

[23] Mineral and Petroleum Resources Development Act s 49(1)(b), as amended by Bill cl 37.

[24] And conditions.

[25] In either case. Mineral and Petroleum Resources Development Act s 49(1), as amended by Bill cl 37.

[26] Over any land or for any mineral.

[27] The Act’s only other reference to the “national interest” is in the provision about local beneficiation (dealt with above), which states the Minister must initiate or promote local beneficiation of mineral resources to ensure “sustainability for [sic] the supply of minerals in the national interest.” Mineral and Petroleum Resources Development Act s 26(1)(b), as amended by Bill cl 21.

[28] Mineral and Petroleum Resources Development Act s 1 sv “strategic Minerals,” as inserted by Bill cl 1(zB).

[29] Or reconnaissance permission or permit, technical co-operation permit, or exploration or production right.

[30] Or restricted.

[31] Or restricted.

[32] And conditions.

[33] Or restricted.

[34] Dawood and Another v Minister of Home Affairs and Ors; Shalabi and Ano v Minister of Home Affairs and Ors; Thomas and Ano v Minister of Home Affairs and Ors, 2000 (8) BCLR 837 (CC) para [53].

[35] And conditions.

[36] If it is impossible to determine any instance of when a need might arise or what the national interest or a strategic mineral may be, or to determine any criteria for identifying land or minerals or determining periods when or terms on which grants of rights and permits should be prohibited or restricted, then arguably the provision serves no rational purpose and should be repealed.

[37] Affordable Medicines Trust and Others v Minister of Health of RSA and Another, op cit, para [34].

[38] There will be occasions when a judicial officer will find that the legislation, though open to a meaning which would be unconstitutional, is reasonably capable of being read in conformity with the Constitution. Such an interpretation should not however be unduly strained. Investigating Directorate: Serious Economic Offences and Others v Hyundai Motor Distributors (Pty) Ltd and Others: In re Hyundai Motor Distributors (Pty) Ltd and Others v Smit NO and Others 2000 (10) BCLR 1079 (CC) para [24].

[39] I.e., intending prospectors and miners, etc.

[40] Dawood and Another v Minister of Home Affairs and Ors; Shalabi and Ano v Minister of Home Affairs and Ors; Thomas and Ano v Minister of Home Affairs and Ors, op cit, para [47].

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Gary Moore

Gary Moore BA LL.B. (Witwatersrand) LL.M. (UC London) is a South African lawyer and Senior Researcher at the Free Market Foundation.

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