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THE Government has clarified investments in the mining sector following misconception that may have been caused by the amendment to the Indigenisation and Economic Empowerment Act.
Following the amendment to the IEE Act section 3 (1), the Government has repealed the requirement for 51 percent of the shareholding of business involved in the extraction of platinum and diamond to be owned through a designated entity.
In a joint statement released this week Tuesday, the Ministries of Finance and Economic Development, and Mines and Mining Development said:
“It has come to Government’s notice that the amendment to the Indigenisation and Economic Empowerment Act [Chapter 14:33] (IEE Act) contained in the Finance (No 2) Act, 2020 (section 36) may have caused some misconception to some investors and other stakeholders in the mining sector.
“There are no minerals the extraction of which require a business extracting same to have 51 percent of its shareholding being owned by a designated entity.”
The Government said this was consistent with the position that there is no mineral, the extraction of which, Government considers requires mandatory shareholding participation through a designated entity.
“The provision in Section 36 of the Finance (No 2) Act, 2020, to the effect that the Minister responsible for the IEE Act, may, in consultation with the Ministers responsible for Mines and Finance prescribe a mineral, the extraction of which would be subject to 51 percent shareholding by a designated entity, has been interpreted by some to represent a departure from Government’s stated position to open the mining sector to investment without the requirement for 51 percent of the shareholding being held by a designated entity.”
The Government said the amendments are designed to buttress the “Zimbabwe is open for business” mantra and enhance certainty in the mining sector.
Online Reporter