BACKGROUND
The illegal mining pandemic in South Africa, and the African continent at large, which is often blended with artisanal and small-scale mining (ASM), presents a severe threat to the country’s formal mining sector, economic stability, and security. In South Africa, mining is regulated by various legislation, including, the Mineral and Petroleum Resources Development Act, No. 28 of 2002 (the MPRDA), the Mine Health and Safety Act, No. 29 of 1996 (the MHSA), the National Environmental Management Act, No. 107 of 1998 (the NEMA), the National Water Act, No. 36 of 1998 (the NWA) and the National Waste Act, No. 59 of 2008 (the WA), to name a few.
One of the key elements of the illegal mining crisis has been the historical absence of a clear legislative framework to regularise artisanal miners, pushing them into a criminalised environment. The draft Mineral and Petroleum Resources Development Bill, 2025 (the Draft Bill), which was published for public comment in May 2025, and which still has room for further improvement and clarity, is a pivotal legislative step, offering a legitimate pathway for the co-existence between large-scale mining (LSM) companies and ASM, where mining operations can be conducted safely without compromising the health and safety of persons and the environment.
Although the Draft Bill’s new licensing system and designated areas are crucial, its effective implementation will depend on overcoming significant challenges for both the government and mining companies. Successful regularisation of ASM is not only a matter of legal reform but a shared responsibility between stakeholders.
THE PROBLEM: LEGAL UNCERTAINTY FUELLING ILLEGALITY
The illegal mining challenges which South Africa is faced with are deeply rooted in socio-economic conditions, being primarily poverty and unemployment in local communities surrounding mining operations. Previously, the MPRDA lacked a specific framework that enabled artisanal miners to apply for prospecting or mining permits in relation to ASM. This regulatory gap meant that individuals engaged in subsistence mining were, by default, operating illegally, making them vulnerable to exploitation by sophisticated criminal syndicates. The absence of a formal, legal pathway by government, coupled with rampant societal poverty and unemployment, has exacerbated these sophisticated criminal syndicates, and has led to increased conflict, fuelled violence, and significant environmental degradation.
THE PARADIGM SHIFT: LEGAL RECOGNITION IN THE DRAFT BILL
The Draft Bill marks a fundamental shift in South Africa’s approach to ASM, moving from criminalisation to formalisation. Although not specifically included, this legislative step is a direct and consistent outcome of the principles outlined in the Artisanal and Small-Scale Mining Policy, 2022 (the ASM Policy) published by the Department of Mineral and Petroleum Resources (the DMPR). The Draft Bill translates the Policy’s objectives into legally binding provisions.
The Policy aimed to create an enabling legal environment for ASM, with key objectives including formalisation of the mining sector, poverty alleviation, and the promotion of sustainable mining practices. The Draft Bill is largely consistent with these objectives, providing the legislative backing required to implement them. Some of the relevant sections of the Draft Bill which we have identified, are:
- Section 27A: Artisanal Mining Permits – This new Section establishes the application for, issuing and duration of specific ASM permits. This provision is a direct legislative expression of the Policy’s goal to create a “fit-for purpose permitting framework.” The Draft Bill’s permit is tailored to the needs of subsistence miners, with less stringent requirements than the general mining permit. This consistency is crucial as it legally separates subsistence miners from the criminal syndicates that they are often associated with, enabling a more targeted enforcement approach against organised crime.
- Section 7A & 9A: Designation of Areas for ASM – These new Sections empower the Minister of the DMPR to designate certain areas for ASM and invite applications for ASM permits in, specific, gazetted areas. This directly reflects the Policy’s recommendation for the “ring-fencing” or “designation of specific land” for ASM operations. This, in theory, will provide a legal, safe space for artisanal miners to operate, reducing the risk of trespassing on active mining rights and preventing conflicts with LSM companies.
- Section 5B: Prohibition on Aiding Illegal Mining – To combat the criminal aspect, the Draft Bill introduces new offences related to illegal prospecting and mining. This provision is fully consistent with the Policy’s objective to combat criminal activities within the mining sector. It allows for more stringent enforcement against the facilitators and criminal syndicates that exploit artisanal miners.
THE ROLE OF MINING COMPANIES: FROM CONFLICT TO COLLABORATION
The legal framework provided by the Draft Bill creates a powerful incentive for LSM mining companies to transition from a conflict-driven relationship to one of co-existence. The role of LSM companies is not just to comply with the law, but to actively participate in the formalisation of ASM. This is also in line with the Policy which encouraged the establishment of partnerships between LSM and ASM.
- Tributing Agreements: The Draft Bill and its associated policies encourage collaborative models, which have already been effective in certain jurisdictions across the African continent. Various countries, and companies, have developed regulated framework agreements and have developed government-driven initiatives that support ASM. This model is mutually beneficial as it allows the LSM company to derive value from marginal resources it might not otherwise exploit, while providing artisanal miners with legal access to mineral deposits, technical assistance, and a secure market for the minerals that are mined.
- Community Development and Corporate Social Responsibility: Beyond direct collaboration, mining companies have a crucial role in supporting the surrounding communities. By investing in local economic development, providing skills training, and contributing to infrastructure, they can address the socio-economic drivers of illegal mining. Again, this is in direct support of the Policy’s call for LSM companies to assist in community development and support ASM formalisation.
POTENTIAL CHALLENGES FOR MINING COMPANIES
While co-existence is a commendable goal in theory, it is not without significant challenges for LSM companies, a few of which include:
- Operational and Safety Risks;
- Reputational and Legal Liability;
- The Effects on Local Communities;
- Environmental Degradation:
- Social Disruption; and
- Obtaining an environmental release following the partial or complete relinquishment of land.
RECOMMENDATIONS
The success of this framework hinges on collaborative action. Mining companies must embrace their role as partners in this process by leveraging the new legal provisions to forge agreements with ASM groups, which must be formally registered and regulated, invest in community development, and share resources and expertise.
Government has a significant role to play. Government must ensure that the Draft Bill’s provisions are supported by a clear regulatory framework and robust administrative capacity. Historically, LSM companies have incurred exorbitant security costs because of, amongst other things, administrative failures to regulate artisanal mining and monitor instances of illegal mining. Measures such as simplifying the permit application process and ensuring security of tenure for existing rights and permits holders, owners of old order dumps and residue deposits and holders of other rights in land should be considered. Further, by providing the necessary technical and financial support to artisanal miners to help them formalise their operations and adopt safer, more environmentally sound practices.
Government should further consider and monitor some of the following key concerns that may affect LSM companies:
- The potential increase in violence and security risks;
- Ensuring compliance with applicable legislation, including the requirement to provide sufficient financial provision for environmental rehabilitation;
- Ensuring that ASM applications are confined to particular areas and certain types of operations;
- Preventing unlawful access to land; and
- Developing a regime where rights may be subdivided and transferred to ASM operators.
Only through such a concerted effort can the dual challenges of illegal mining and socio-economic inequality be addressed, transforming a source of conflict into a pillar of sustainable development for South Africa.
CONCLUSION
The co-existence of LSM and ASM is not a far-fetched fantasy but a pragmatic necessity for South Africa. The Draft Bill provides the legal architecture for this reality by creating a formal pathway for artisanal miners, thereby reducing unemployment and, by effect, poverty cycles, and empowers government to theoretically manage the sector more effectively. This shift from a punitive to a formalisation-based approach, as articulated in the Policy, is a crucial step towards inclusive economic growth, poverty alleviation, improved safety and security and the ultimate reduction of illegal mining practices.
Should you require any more information, please contact Warren Beech at warren@bv-inc.co.za or Mbuyi Katumba at mbuyi@bv-inc.co.za.
Disclaimer: This article is provided for informational purposes only and is not intended to serve as legal advice. Readers should consult one of our legal professionals for advice tailored to their specific circumstances.