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S A Mining Law Although copper and a few other minerals were discovered and mined in South Africa from the 1600's, it was really the discovery of diamonds and gold in the late 1900's that ignited the initial industrialisation of South Africa. Since then, a host of other minerals have been discovered and mined. Mining has made a significant contribution to the GDP of the country over the years and continues to do so today. Experience (and common sense) shows that the occurrence of commercially exploitable minerals is only part of the picture that makes up a successful minerals industry; skills, technology, available capital, an effective regulatory environment and many other factors make up the rest. As regards the regulatory (legal) environment, South Africa has had various sets of mineral laws over the years, ranging from private mineral right systems to State-owned systems; and, sometimes a combination of the two. In roughly the 10 year period prior to 2004, a purely private system of mineral rights existed whereby mineral rights could be freely bought (acquired) and/or sold (ceded) in much the same way as any other rights could. The Department of Minerals and Energy (DME) still played an important role during this time but that role was confined to licensing the use of existing rights (on safety, environmental obligations and acceptable mining method grounds); it was not involved with granting the rights themselves. This can perhaps be best understood through the analogy of a local authority licensing a motor vehicle for use on a public road - the local authority does not award ownership of the vehicle (it is already owned by the applicant for the licence) - it just permits its use. In the same way, the DME at that time just permitted the use of mineral rights already acquired at common law (for instance, through the purchase of those rights by the applicant). The introduction of the Mineral and Petrol Resources Development Act in 2004 fundamentally changed this. It vested all rights to minerals in the State and the State consequently became the sole competent authority to allocate prospecting or mining rights. In short, whereas mineral rights were previously purchased - now, they are merely "applied for". The system moved from a private negotiation process to an administrative application process and the "key" to the successful acquisition of rights changed from private negotiation and payment to administrative compliance. Anybody can now apply for prospecting rights over ground which they believe has mineral potential. And, provided that theirs is the first, compliant application then, according to law, the application must be successful. The whole system is underpinned by a general and well-developed body of administrative law which together with specific legislation such as the Promotion of Administrative Justice Act and the Constitution of South Africa, are designed to ensure that compliant applications are granted and not arbitrarily refused. This page will be shortly and regularly updated to give some more background on this administrative process, the requirements for prospecting and mining right applications, the provisions governing transfers of prospecting rights, impending legislation that will affect the exploration and mining industry and more. If you would like to be updated by email of developments in any of these areas then please let us know. You can refer to our Contacts Page for our email address and other contact details.
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