Erica Emdon and Jacob van Garderen are the directors of Public Interest Practice and write on behalf of Corruption Watch.research report, which looked at equity benefits and compensation flowing from mining, and whether these were reaching mining-affected communities. It concluded that widespread corruption was evident and that, overall, the communities most affected by mining were not benefiting, but continued to live in conditions of poverty.
The fact that this alternative exists is problematic, since it allows mining companies to choose the easier option, which they frequently do, and negotiate exclusively with traditional authorities rather than the households that live closest to the mining operations. Baleni and others v Minister of Mineral Resources and Others, North Gauteng High Court, Case No. 73768/2016
The MPRDA changed this by placing ownership of minerals in state hands, and providing that the community for whose land the mining licence is sought must be consulted by a prospective mineral rights holder prior to a licence being issued. If the community happens to be on land that is covered by the Interim Protection of Informal Land Rights Act , then the mineral rights holder cannot deprive people of their land without their consent.
In general, the community trust has been the most popular and widely used legal structure to manage the receipt of compensation and equity. A community trust is a legal body that is set up in terms of the Trust Property Control Act, through which ownership in property of one person is, by virtue of a trust deed, made over to a trustee to administer for the benefit of others.
However, it is not just community trusts that are vulnerable to poor and unscrupulous governance. There are also examples of community-owned companies being raided of funds and investments meant for the beneficiary community. A good example is the Bapo Ba Mogale Investments company, which was created to be the business arm of the Bapo Ba Mogale mining community.
Secondly, trustees should have to disperse a minimum value every year. What has been problematic is trustees sitting year after year earning fees, and not dispersing benefits. There should be some definition of a minimum contribution that beneficiaries must receive every year. Further, a trust must be very specific about what types of projects will qualify for benefit.
LarcUCT Take a look at changes to NEMA’s 2014 EIA Regulations from 11 June 2021 - all landowners must now give consent prior to an application for environmental authorisation (which mining activities require).
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