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Craig Atkinson, local partner in Global M & A at White & Case.
the right decisions to assist with enticing
global mining companies to come
sink shafts in our country,” says Craig
Atkinson, local partner in Global M & A
at White & Case.
“One of the key questions to consider
is whether the provisions of the new
Mining Charter are positively or
negatively impacting on investment into
mining in South Africa,” says Felthun.
“We need to be cognisant of the fact
that South Africa has to be competitive
in the international environment and
investors will generally want certainty
around things like the new Mining
Charter before they will be willing to
invest,” Atkinson adds.
“What South Africa needs is
greenfields projects. New mines create
more jobs, and that is what South
Africa needs,” says Felthun. He remains
positive about the outlook for the
country. “Politically, most people believe
that South Africa is heading in the right
direction,” says Felthun.
Burning question about land
The expropriation without
compensation issue, now referred to as
EWC, has become an albatross around
Ramaphosa’s neck. He has on many
occasions said that the ANC’s decision
to amend the constitution will not
www.miningmirror.co.za
Gary Felthun, partner at law firm White & Case and head of Mergers
and Acquisitions.
result in land grabs, and has promised
that if the constitution is altered,
restitution will take place in an orderly
manner. Regardless, the business
community remains pessimistic and the
issue has reverberated around the world,
with even US President Donald Trump
getting involved. A number of CEOs
trying to raise funds at international
‘roadshows’ for projects in South Africa,
tell Mining Mirror that the first concern
raised by international investors is about
expropriation. It seems that EWC has
seriously dented Ramaphosa’s mission to
wow global investors.
According to Martin van Staden, a legal
researcher at the Free Market Foundation,
private property rights are an imperative
in any free and developing society. “On
every index of human development, for
example freedom, the rule of law, and ease
of doing business, countries that rank
highly have entrenched systems of secure
property rights. Invariably, the countries at
the bottom of these indices have virtually
no, or very weak, protection for private
property,” says Van Staden.
“If South Africa wishes to attract
foreign investment and develop into a
prosperous first-world country, section
25 of the Constitution, if anything, must
be strengthened — not weakened — to
promote legal certainty,” he adds.
Section 25(3), which the ANC has
pledged to change, currently provides
that “just and equitable” compensation
must be provided when property is
expropriated, and section 25(8) provides
that no other part of section 25 may
impede the State from redressing
the results of past discrimination,
on condition that such departure
from the provisions of the property
provision complies with section 36.
Section 36 allows for the rights in the
Bill of Rights, including the right to
compensation, to be limited in pursuit
of a legitimate government objective.
These two provisions — section 25(3)
and 25(8) — it is argued, thus already
hypothetically provide for lawful EWC,
and it is thus not necessary to change
the constitution.
What about foreign investment?
“It is important to consider the
effect EWC may have on not only
foreign direct investment (FDI) but
international law, says Peter Leon,
partner and Africa co-chair: Africa
Group at law firm Herbert Smith
Freehills.
“FDI is the lifeblood of any developing
economy, and South Africa cannot afford
to forego it. From 2013 to 2017, while
FDI inflows into the country declined
JANUARY 2019 MINING MIRROR
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