Presentation to the PC on Mineral Resources

Legal opinion - President’s referral of the Mineral and

Petroleum Resources Development Amendment Bill, 2013 [B15B-2013] to the NA.

18 February 2015:Desiree Swartz – Parliamentary

Legal Adviser

Introduction

• Context of opinion • It addresses the constitutional concerns raised in the President’s

reservations dated 16 January 2015

• The presentation highlights the salient point addressed in the legal opinion dated 5 February 2015 which was forwarded to the committee.

Referral Grounds

• Definition of “this Act” and amendment to section 74 of the Act.

• The amendment to section 26(2) and 26(3) • Highly compressed public participation process of

the NCOP and the Provincial Legislature • Referral to the National House of Traditional

Leaders (“NHTL”)

Definition of “this Act” and amendment to s74 of the Act

Content of reservation • The definition of “this Act” read together with the

amendment in clause 74 of the Bill will have the effect of bypassing the constitutionally mandated procedure for the amendment of legislation.

• Giving the Minister the power to amend or repeal the Codes, the Standards and the Charter (which are included in the definition of “this Act”) the Minister is given the power to amend national legislation.

Definition of “this Act” and amendment to s74 of the Act - Cont

Legal context• The national legislative authority is vested in Parliament. It

may consider, pass, amend or reject any legislation before it.• The Constitution provides that ‘national legislation’ includes

subordinate legislation made in terms of an Act of Parliament.• The Constitutional Court stated that

– “In a modern State detailed provisions are often required for the purpose of implementing and regulating laws and Parliament cannot be expected to deal with all such matters itself. There is nothing in the Constitution which prohibits Parliament from delegating subordinate regulatory authority to other bodies...”

Definition of “this Act” and amendment to s74 of the Act - Cont

Opinion• It is correct that the definition of ‘this Act’ in the Bill includes the Codes, Standards and

Charter and because the amendment contained in clause 74 gives the Minister the power to repeal or amend these Codes, Standards or Charter, it appears that the Bill is giving the Minister the power to amend national legislation.

• However, the Codes, Standards and Charter remain subordinate legislation, authorised in terms of a principal Act.

• There are many examples in current legislation where the definition of ‘this Act’ includes subordinate legislation.

• The Constitution makes provision for Parliament to delegate its legislative function. Including delegated legislation in the definition of “this Act” is accepted legislative practice.

• It is my view that the power given to the Minister to amend the Codes, Standards and Charter, even if these are included in the definition of “this Act”, would not prevent the Bill from passing constitutional muster.

The amendment to section 26(2) and 26(3)

Content of reservation • The President is of the view that the imposition of

quantitative restrictions on exports in sections 26(2B) and 26(3) would render the state vulnerable to challenges in international fora.

• This would be inconsistent with South Africa’s obligations under the GATT and TDCA.

The amendment to section 26(2) and 26(3) - Cont

Legal context• South Africa is a founding member of the WTO

Agreement• South Africa is also a party to the 1999 TDCA.• Article XI of the GATT and article 19 of the TDCA prohibit

the parties to these agreements from imposing quantitative restrictions on exports.

• A quantitative restriction is a measure which places a limitation on the amount of goods that may be exported from a country.

The amendment to section 26(2) and 26(3) - Cont

Legal context - Cont• The Supreme Court of Appeal held – “The WTO Agreement was approved by Parliament on 6

April 1995 and is thus binding on the Republic in international law”

• The President’s concern that that the state may be challenged in international fora is thus accepted, however, the question remains whether this renders the Bill unconstitutional for the purposes of section 79(1).

The amendment to section 26(2) and 26(3) - Cont

Q: Do the amendments make the Bill constitutionally susceptible?

• In the Glenister case, the Constitutional Court held that the ratification of a Convention does not gives rise to a constitutional rights and obligations.

Opinion• It is therefore my view that the ratification of the GATT

and the TDCA does not create constitutional rights and obligations and thus sections 26(2B) and 26(3) will pass constitutional muster.

Public participation process of the NCOP and the Provincial Legislature

Content of reservation • The President is of the view that the NCOP and the

Provincial Legislature(s) did not sufficiently facilitate public participation as required by sections 72 and 118 of the Constitution.

• He submits that the consultation period was highly compressed and there appears to have been insufficient notice of the public hearings held by the provincial legislatures.

Public participation process of the NCOP and the Provincial Legislature - Cont

Legal context• The Constitutional Court comprehensively

considered the nature and extent of public involvement in its legislative processes.

• The Court has stated that Parliament has a significant measure of discretion in determining how best to fulfil its duty to facilitate public involvement. What is required varies from case to case.

Public participation process of the NCOP and the Provincial Legislature - Cont

Legal context - Cont• It must act reasonably within the context of the case.

Reasonableness will depend on a number of factors, including: – the nature and extent of the legislation and the intensity of its

impact on the public; – practicalities such as time and expenses, which relate to the

efficiency of the law-making process; – rules, if any, adopted by Parliament to facilitate public

participation; and – whether the legislation needs to be enacted urgently.

Public participation process of the NCOP and the Provincial Legislature - Cont

Content of the Bill• The provisions of the Bill broadly relate to the following:

– The processing of applications under the Act. – Consultation with interested and affected parties.– It dissolves the Petroleum Agency of South Africa and establishes

Regional Development Environmental Committees.– Mineral beneficiation.– The State’s participation in all new exploration rights.– Appeal process prior to the execution of rights. – Sanctions in respect of offences committed under the Act.– The regulation of exploration of associated minerals.

Public participation process of the NCOP and the Provincial Legislature - Cont

PC amendments to the Bill• The Portfolio Committee deliberated extensively on the

Bill and made several amendments to the introduced Bill. • It also added new provisions to the Bill. • The amendments made by the Portfolio Committee

related to contentious issues raised in the public submissions.

• It is therefore submitted that the Bill that was considered by the NCOP differed substantially from the introduced Bill.

Public participation process of the NCOP and the Provincial Legislature - Cont

Opinion • The Bill is important as it envisages significant changes to the

regulation of the mineral and petroleum industry.• The mineral industry is one of the major contributors to the

country’s gross domestic product. Mining activities also impacts on the communities and the environment around them.

• It can therefore be expected that the public would show considerable interest during the various stages in the legislative process.

• The NCOP considered and processed the Bill within 15 days. There were no reasons given why the Bill should be enacted urgently.

Public participation process of the NCOP and the Provincial Legislature - Cont

Opinion - Cont• It is my view since the Bill was substantially different

from the introduced Bill on which the Portfolio Committee held public hearings, and since no indication of urgency around the enactment of the Bill was provided, the time that was given to the public after the Bill was passed by the NA to engage with the NCOP was inadequate.

• There was no meaningful opportunity given for public participation in the NCOP process.

Referral to the NHTL

Content of reservation • The President also submits that the amendment to

s50 of the Act which allows a person to enter upon land to conduct an investigation after notifying and consulting with the owner, occupier or person in control of the land, ignores the consent principle in customary law.

• The Bill should therefore have been referred to the NHTL.

Referral to the NHTL - Cont

Legal context • Section 18(1)(a) of the Traditional Leadership and

Governance Framework Act, 2003 provides the following: – “(1) (a) Any parliamentary Bill pertaining to customary

law or customs of traditional communities must, before it is passed by the house of Parliament where it was introduced, be referred by the Secretary to Parliament to the National House of Traditional Leaders for its comments.”

Referral to the NHTL - Cont

What is the consent principle?• The Interim Protection of Informal Land Rights Act,

provides that no person may be deprived of any informal right to land without his or her consent.

• The informal right to land includes the use of, occupation of, or access to land in terms of tribal, customary or indigenous law or practice of a tribe.

• Land can only be disposed of in terms of a decision in terms of customary law and the consent of a general meeting of the affected community members.

Referral to the NHTL - Cont

Opinion• S 50 of the Act as amended by the Bill allows the Minister to direct that a

person may enter upon land to conduct an investigation to establish if any mineral or geological formation occurs in, on or under such land after notifying and consulting with the owner, occupier or person in control.

• This section does not require the Minister to obtain the consent of the person.

• I am of the view that such an investigation to would disturb a person’s use of, occupation of, or access to land in terms of tribal, customary or indigenous law.

• The consent principle under customary law would accordingly require consent before such an investigation.

• It is my view that the Bill must be referred to the NHTL for its comments.

Referral to the NHTL - Cont

Content of reservation • The President is of the view that the Bill impacts

upon customary law or the customs of traditional communities and therefore should have been referred to the NHTL.

Referral to the NHTL - Cont

Opinion• The Bill provides that tThe community exercises their right or

interest in the land communally in terms of agreement, custom or law.

• The redefining of community is wide enough to encompass ‘traditional community’ envisaged in the Traditional Leadership and Governance Framework Act, 2003.

• I am therefore of the view that this provision pertains to customary law or customs of traditional communities and accordingly recommend that the Bill be referred to the NHTL.

Conclusion and Recommendations

• It is my opinion that:– The power given to the Minister to amend the Codes, Standards and Charter

does not bypass constitutionally mandated legislative procedures. The definition of “this Act” read with clause 74 will pass constitutional muster.

– The ratification of the GATT and the TDCA does not create constitutional rights or obligations and the amendments to section 26(2B) and 26(3) will pass constitutional muster.

– There was no meaningful opportunity given for public participation in the NCOP process. It is recommended that this procedural defect be addressed in the Select Committee.

– It is further my opinion that it was necessary to refer to the Bill to the NHTL for its comments. It is recommended that the Bill be referred to the NHTL and that the Portfolio Committee considers comments so received.