The Chamber of Mines of South Africa (the Chamber) is a private sector employers’ organisation registered as such under the Labour Relations Act. The Chamber was established more than 100 years ago and its main purpose is to secure an enabling environment for a thriving mining industry in South Africa. Membership of the Chamber is voluntary and it is funded from contributions by its members. Members of the Chamber employ about 90% of all employees employed in the mining industry and sell about 90% of all mineral sales in and from South Africa.

The mining industry has been the flywheel of the South African economy for the last 100 years. Although the role of gold mining in the South African economy has declined over the last number of years, many other precious metals have increased their contribution to the South African economy. The mining industry remains a successful industry and will continue to play an important role in the SA economy for many years to come. Some of the specific contributions of mining to the SA economy (for the year 2001) were:

In addition to the above direct contributions to the South African economy, there are many other businesses and communities that supply services to the South African mining industry. If this so called "multiplier effect" is taken into account, the role of mining in the South African economy is much larger. Additionally, it is estimated that about 7 to 10 persons are dependant on each mineworker employed in the industry.

By far the most common method of breaking rock in the mining industry is by the use of explosives. Due to the size of the industry in South Africa, members of the Chamber make extensive use of explosives and are probably the largest user group of explosives in the country. Members of the Chamber therefore have a particular interest in and will be directly affected by the Explosives Bill.

In terms of the Mine Health and Safety Act, Act No. 29 of 1996 (the MHSA) the Mine Health and Safety Inspectorate (of the Department of Minerals and Energy (DME)) is responsible to ensure occupational health and safety at mines and that all the provisions of the MHSA are complied with and enforced. By section 98(1)(k) the Minister of Minerals and Energy may make regulations regarding the transport, handling, storage and use of explosives and the mixing of substances to make explosives at mines. The DME, through the Mine Health and Safety Inspectorate, is therefore responsible in terms of the MHSA for all aspects of explosives at mines relating to occupational health or safety. (In industries other than mining, occupational health and safety are regulated by the Occupational Health and Safety Act, Act 85 of 1993.)

Currently section 31(c) of the Explosives Act, Act No.26 of 1956 provides that the Explosives Act (except section 8A) does not apply to the transfer, transport, use, storage and distribution of explosives in so far as these activities are governed by any regulation made under the Mines and Works Act. Because of this exclusion, the Explosives Act currently has very little application to the mining industry. For practical purposes the Explosives Act applies to surface magazines at mines and the transport of explosives to such magazines.

The Chamber fully accepts that it is the SAPS’s function to ensure security in the country, including at mines. However, this function should be distinguished from ensuring healthy and safe use of explosives at work. The extent to which the unsafe use of explosives at work could possibly create security risks requires closer co-operation between the mining industry, the DME and the SAPS, but does not necessarily require regulatory control under two separate statutes. The principle should be that a specialist statute (such as the MHSA) dealing with specific matters (occupational health and safety at mines) should be used as a means for regulating those matters. Such matters should not also be regulated in another statute (eg. the Explosives Bill should not also regulate occupational health and safety issues). Worse even, those matters should not be duplicated in another statute. This will merely mean that there will be confusion as to which statute should be complied with and which enforcing agency will have the final say. From the point of the end consumer (regulators, employees and employers), it should be clear that it would be potentially inefficient, unfair and confusing to expect them to try and apply, comply with and rely upon different requirements of different enforcement agencies regarding the same topic.

Unlike what is the position under the Explosives Act, the Bill does not exclude any aspect of the use, storage, etc. of explosives at mines from its application (compare clause 2). At this stage the mining industry will therefore have to comply with all the provisions of the Bill. For example, the mixing of explosives three kilometres underground will have to be licensed under the Bill (as would various other activities involving explosives). It should be clear that there is hardly any security risk under those circumstances, but much more of an occupational health and safety risk. Areas where such "manufacturing" of explosives take place would also have to be licensed under the Bill. However, since such areas could change at relatively frequent intervals because of the advancement of working faces, it means that such areas would have to be re-licensed regularly. This is clearly cumbersome and unnecessary and holds no benefit to anybody.

A further problem is that permits for the use, storage and other dealings in explosives may only be issued to "suitable persons". (See clause 15(2).) Suitable persons can only be natural persons and not legal entities (see the definition in clause 1). In addition, such persons must either be a South African citizen or the holder of a permanent South African residence permit. These provisions will be to the serious detriment of the mining industry. Firstly, employers (mining companies) will not be able to apply for permits to keep, store, be in possession of, etc any explosives as most employers are legal entities. They will have to identify individual employees to do so on their behalf. This means that the employer will not be able to promote, transfer or terminate the employment of the employee concerned unless another employee has applied for, and has been granted, a similar permit in respect of the same premises or activity. Worse even, the employer could be forced to terminate its operations until a new employee has been granted a permit, should the current holder of the permit go on leave or resign. Additionally, the industry employs many employees from other countries in Southern Africa. Of the 409 000 employees in the industry, about 114 000 (i.e. more than 27%) are from outside South Africa. It means that such persons could never obtain such permits and, worse even, would always have to work under the constant supervision of a "suitable person" (see clause 15(1)(b)).

Another problem is that a person using explosives must either be in possession of a permit or do so under the immediate and constant supervision of a person holding a permit (see clause 15(1)). These provisions will not be implementable if a permit is issued to a legal (not a natural) person.

When the existence of the then draft Explosives Bill came to the attention of the Chamber and the DME earlier this year, interdepartmental meetings were arranged to discuss the Bill. Three meetings were held and at a

meeting on 16 July representatives of the SAPS, the DME, the Department of Labour and the Chamber agreed ¹ that:

The Chamber understands that when the Explosives Bill was subsequently discussed between the SAPS and the state law advisers, the state law advisers indicated that they could not, at that stage, incorporate in the Bill amendments to give effect to the above agreement because such amendments had not been part of the Bill as previously approved by cabinet. The state law advisers indicated, however, that those amendments could be incorporated when the Bill was considered by the Parliamentary Portfolio Committee on Safety and Security if approved by the Portfolio Committee.

Arising from the agreement reached on 16 July referred to above, it is proposed that the following amendments be made to the Bill:

Arising from the recognision of legal persons as "suitable persons", provisions along the following lines could be included:

(a) any change in control of that holder; and

(b) the names of all natural persons authorised by such holder, from time to time, to exercise the rights and obligations under the permit or licence.

(For purposes of clause (2)(a) above the following definition should also be inserted:

"change in control" means a change in the person or any of the persons who ultimately may take executive or managerial decisions, including –

(i) the right or ability, directly or indirectly, to exercise or otherwise control the votes attaching to the majority of the issued voting shares in that company; or

(ii) the right or ability, directly or indirectly, to appoint or remove the majority of directors of that company or directors holding a majority of the voting rights at meetings of the board of directors of that company; or

(iii) ownership of more than 50% of the ordinary issued shares of that company;

The Chamber would like to offer the additional comments on some of the other provisions of the Bill.