Cape Town — An international arbitration tribunal in The Hague has dismissed an objection by Italian investors to the Mineral and Petroleum Resources Development Act and the mining charter, endorsing SA's mining legislation.
The investors claimed that SA's black economic empowerment requirements represented expropriation and violated the country's bilateral investment treaties with Italy and the Belgo-Luxembourg Economic Union.
While the tribunal - administered by the World Bank-associated International Centre for the Settlement of Investment Disputes - did not pronounce on the merits of the case, the fact that the investors agreed to its dismissal and that the government was awarded costs, was a victory and an implicit endorsement of the mining law.
The case was brought by several Italian individuals and a Luxembourg corporation they own.
They have an indirect interest in Red Graniti and Marlin, two granite companies owned by Finstone SA.
The claimants argued that the act forced them to sell a stake in their local mining operations in order to successfully convert their old-order mining rights into new-order rights.
In its ruling the tribunal dismissed the claims and ordered the companies to pay 400 000 (R3,8m) towards the South African government's legal costs.
The claims were dismissed with prejudice, which means that they cannot be revived again in future.
After successfully having their old-order rights converted into new-order rights without any interruption to business, the claimants sought to halt the tribunal proceedings. But the tribunal rejected this bid as there was no agreement with the government on costs.
It said that foreign investors could not expect respondent states to carry the legal costs of claims that were abandoned.
