Patrice Motsepe. Picture: SUPPLIED

Patrice Motsepe. Picture: SUPPLIED

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African Rainbow Minerals executive chairman Patrice Motsepe evoked the wrath of the National Union of Mineworkers (NUM) when he came out in favour of the principle of "once empowered, always empowered" last week.

The contentious clause in the mining charter requires companies to continuously find new black partners to maintain their BEE ownership at 26%, which is complex and costly.

"Because it’s a cost, certainty is critically important," Motsepe said. "If shareholders have to incur a cost, just spell it out. Don’t change the rules of the game."

The NUM said this position was regressive and called for the department of mineral resources (DMR) to finalise urgently the draft mining charter to close the gap that is being exploited for "narrow neoliberal and capitalistic gains by the elite".

The DMR’s new draft five-year charter was gazetted in April without consultation with the industry. It contains this clause, as well as a number of new targets, for example on employment equity, community development and local procurement, that have alarmed industry.

The latest draft appeared only a month after the Chamber of Mines asked the courts for a declaratory order on the "once empowered, always empowered" clause in the 2010 charter.

Mining companies are understood to be putting forward proposals to try break the logjam with government over black ownership goals.

One proposal is that government and industry should agree on long-term black ownership targets, rather than change them every five years. Higher levels could apply to new mining right applications but current and historic mining rights, which meet the 26% requirement, should not have to be refreshed.

Long-term goals are likely to be higher than they are at present, but will provide certainty for investment decisions.

"We need to know what the end game is, in other words the ultimate transformation goal towards which everyone is working over the long term," a source, who asked not to be identified, said. "That means even if companies fall behind in the short term, they are still committed to meeting the long-term goal."

The past two mining charter reviews led to some bitter interchanges between the DMR and mining companies, as the DMR rejected the companies’ claims of having reached or exceeded 26% black ownership. The DMR’s own commissioned research showed it was far less.

Anglo American SA has proposed forming a mining industry council, representing all role-players, similar to the financial services council.

This professionally run body would deal with transformation issues in an accurate and credible way.