• Department of Minerals and Energy

• Mintek

Overview

• Objectives of the Bill

• Issues Raised:

- Definitions

- Clause by clause

- Other: Matters

• Conclusion

Objectives of the Bill

Eliminate barriers to local beneficiation of precious metals

Grow beneficiation industry in SA to create jobs

• Increase participation throughout the value chain

· Make SA a major international mineral beneficiation centre

· Rationalize the regulation of downstream development of precious metals

Definitions

• Re-defining unwrought "precious metal" and "semi-fabricated precious metal"

- Definition re-worded for clarity

• De-regulation of Silver

- Silver has little value and a very small quantity is mined in SA

Clause 2

• Allow for the delivery of unwrought precious metal in payment of any debt

- DME recommends no changes as Exchange control Regulations covers that

Clause 3

• Allow for the delivery of semi- fabricated in payment of any debt

- Deletion of the provision recommended

Clause 4

· Disregarding BEE requirements when granting a licence

- No change recommended

- Mining Charter requires BEE compliance for beneficiation

Clause 5

• Renewal of licence to be linked to the life of mine

- Amended to provide for validity UP to 30 years

• Must allow for disposal of unwrought and semi-fabricated precious metal

- Disposal of semi-fabricated precious metal will be provided for

• Granting and refusal criteria must be stipulated

- Provision to be inserted

Clause 5(3)

• SAPS and National Treasury to be informed when granting and issuing licence

- To be included under Consideration of applications for licences (Clause 4).

Clause 6

· Rights and obligation relating to beneficiation licence the same as those on jeweller's permit

- Beneficiation licensee should be allowed to deal in unwrought with stringent condition imposed

Clause 8

• Criteria to allow imports of semi-fabricated precious metal

- Criteria will be in the regulations

• Blanket import permit for refiners

- Blanket import on PGM's to be considered

- For gold, Exchange Control Regulations is applicable

• Beneficiation licencees or jeweller's permit holders to get blanket import permit

- No blanket import permit

- Conditions will be prescribed on the licence and permit

• Meaning of documentary proof of origin

- Acceptable document to be prescribed

Clause 9

• Criteria for cancellation of licence, permit and certificate

- Addition on paragraph (d) to include "or offences of fraud, theft, corruption, forgery or uttering of a forged document"

Clause 10

• Conditions under which the Minister would approve exports

- Compliance with objectives of the Bill

· Format in which the "written approval" will be granted

- In a form of a Permit

• Request to exclude the consultation with the Governor of the Reserve Bank

- Deletion of the words after the word '"Minister" on clause 10 (2)

Clause 11

• Certified copy of a licence is cumbersome

- Requirement to be deleted

• Certificate of appointment

- Recommends certificate of appointment be replaced by the prescribed document (waybill)

Clause 12

Whether authorised dealer is allowed to deal in PGM's

- Authorised dealer allowed to deal in PGM~

Holder of mining rights not covered

- Recommends clause 12(2) to include holders of mining rights referred to in the MPRDA

• Why authorised dealer has to retain a special permit

- Requirement deleted

Clause 13

• Assurance of confidentiality on information supplied to the regulator

- Provision should be inserted to ensure confidentiality

Clause 14

Provision for the employer to have the same powers as the Police to search employee

- Conditions of employment should be applicable

- lnspectorate created in the Diamonds bill to be applicable in the Precious Metal Bill

- Member of the Police be accompanied by an inspector

Clause 18

• Offences to cover semi-fabricated precious metal

- Semi-fabricated will be fully covered under offences and penalties

• Penalty to be maximised

- No change on the penalty

Additional Comments

Objects and functions of the Regulator

- Objects and functions with regards to precious metals will be inserted in the Bill

• Set beneficiation target

- To be set in the Mining Charter

• Minister to consult stakeholders when declaring certain metals as "a precious metal"

- Minister to consult stakeholders

• Need for General Beneficiation Bill

- Acknowledged, further discussions with Bill

• Provision for transitional arrangement

- insertion of further provision recommended

Conclusion

• Clarity on definitions

• Criteria for issuing and renewal of permits

• Expanded rights of beneficiation and refining licences

• Cross referencing

• Transitional arrangements