• Wholly owned subsidiary of Johnson Matthey Plc

• Main business is manufacturing autocatalysts for vehicle emissions control

• Large and growing South African consumer of precious metals locally beneficiated into catalytic converters

• This business growth has been nurtured by the MIDP

• Support the South African jewellery trade and other local industrial users

[PMG NOTE : A GRAPH ON JOHNSON MATTHEY SOUTH AFRICA SALES GROWTH NOT AVAILABLE]

The MIDP has

· Provided a clear long-term development incentive framework facilitating long term investment planning time horizons

· Incentivised and supported local manufacturing to allow the necessary economies of scale for globally competitive manufacturing to be developed

· Supported local manufacturers in overcoming the strategic cost disadvantage of distance from target market

· Johnson Matthey South Africa fully supports the initiative to encourage beneficiation of local raw materials

· The proposed Precious Metals Bill does not encourage local beneficiation of precious metals

· Whilst the preamble to the Bill indicates the goal is to improve access to precious metals to facilitate beneficiation, the draft Bill potentially increases the administration and cost burden associated with meeting the regulations

· Johnson Matthey proposes that the lessons learnt through the Motor Industry Development Program should be applied to the Precious Metals Industry

· Access to commodities freely traded in global markets does not by itself constitute a competitive advantage

· Precious metals are high value low volume materials with no or minimal cost advantage of being close to a 'source'

· To develop a South African 'beneficiation' industry for precious metals, incentives are required for business to

• make investments
• to develop or acquire the skills required
• assist in overcoming the disadvantage of distance from target markets

• The proposed bill does not address any of these issues, concentrating instead on regulating the various stages of beneficiation

• Johnson Matthey ‘s written submission focuses on the key impacts on our business as follows:

1. The distinction between " downstream beneficiation" and the activities carried out by Johnson Matthey

2. The definitions of " semi-fabricated precious metal " and unwrought precious metal";

Johnson Matthey ‘s written submission focuses on the key impacts as follows:

3. The impact of these definitions on Johnson Matthey’s activities , including the requirement to hold a precious metal beneficiation licence’

4. The requirement to possibly hold a permit to import precious metals ( Section 8)

5. The provisions of Section 10 of the Precious Metals Bill relating to the export of previous metals; and

6. Some general comments on the provisions of the Precious Metal Bill.