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What the new Mining Charter holds for mining
companies and suppliers BEE

October 2018

“I work in the mining sector. It seems that finally agreement has been reached
and a new Mining BEE Charter issued. Am I right when I say that the new
charter determines that in the mining industry you now need to be at least
51% black owned?”

The long-awaited Mining Charter 2018 or Mining Charter III (“MCIII”) has been
signed by the Minister of Mineral Resources on 26 September 2018. MCIII is
immediately effective and applicable to all mining companies in South Africa.

MCIII contains a few vital concepts that must be understood and it is important
to take note of them:

Historically Disadvantaged Persons (“HDP’s”) - These are persons as defined in
the Mineral and Petroleum Resources Development Act which includes people
or communities that were disadvantaged by unfair discrimination before the
Constitution took effect. This concept includes persons with disabilities and
women.

Historically Disadvantaged Persons Owned and Controlled Company
(“HDPOC”) – This refers to an entity which is 51% owned by HDP’s.

BEE Entrepreneur – This refers to an HDP or a company that is at least 51% owned
by HDP’s.
BEE Compliant Company – This is a company with a minimum BEE level 4 status
and is at least 25% + 1 owned by HDP’s.
The MCIII lists six main elements that a mining company needs to comply with:

1. Ownership
Provision is made for three different scenarios or mining rights relevant to the
commencement of MCIII.

New Mining Rights – These refer to mining rights applied for after commencement
of MCIII. A new mining right applicant must have a minimum of 30% BEE
shareholding which must be distributed as follows:
• 20% to a BEE Entrepreneur
• 5% to employees of the applicant
• 5% to the community

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