Mineral and mining law: a German legacy

The impact of German law on the development of the mineral and mining law of Namibia, caused the latter to be fundamentally different from its South African counterpart.

In the late nineteenth century Germany established German South West Africa as its protectorate, introducing German law as the governing law. Get more info here. As a result the concept of mining freedom (“Bergfreiheit”) influenced the development of mineral and mining law in Namibia.

Mining freedom gives the right to anyone to prospect for minerals independently of the right of ownership of the land containing the minerals. If minerals of sufficient value are discovered, the discoverer has to give notice thereof to the State, upon failure of which the discoverer may forfeit the right to obtain statutory licence from the State to exploit the discovered minerals. Mining without licence from the State is prohibited. The State issues licences to mine the minerals and regulate the mining thereof. The miners pay to the State a recurring claim fee for the right to mine, and for the extraction of the minerals, a royalty which is a percentage of the nett profit on the extraction and disposal of the minerals. The owner of the land may also receive a royalty.

The effect of the imposition of the principle of mining freedom on the right of ownership of land in Namibia was that from the moment German South West Africa became a protectorate of Germany in the late nineteenth century the ownership of all minerals vested in the State. The Imperial Mining Ordinance for German South West Africa of 8 August 1905, which was based on the General Prussian Mining Act of 1865 (“Berggesetz”), firmly entrenched in the common law of Namibia the principle of mining freedom and the concomitant vesting of ownership of all minerals in the State, and not only those mentioned in the Imperial Mining Ordinance.

In 1919 South West Africa became a mandate of South Africa. By the Administration of Justice Proclamation 21 of 1919 the Roman Dutch law as existing and applied in the Province of the Cape of Good Hope of the Union of South Africa at 1 January 1920 became the common law of South West Africa from that date. And all laws in conflict therewith were repealed to the extent of the conflict, but all rights, privileges, obligations or liabilities acquired, accrued or incurred prior to that date would be determined according to the law in force in South West Africa at the time of acquisition, accrual or incurrence. Thus, absent the mentioned conflict, the vesting of minerals in the State survived the introduction of Roman Dutch law in Namibia.

On 21 March 1990 South West Africa became the Republic of Namibia by the Namibian Constitution, article 100 of which constitutionalise that land, water, and natural resources, below and above the surface of the land and in the continental shelf and within the territorial waters and the exclusive economic zone of Namibia, shall belong to the State, if they are not otherwise lawfully owned. The German common law adopted in Namibia which survived until 21 March 1990 was saved by article 66 of the Constitution, which provides that the customary and common law of Namibia in force on 21 March 1990 remain valid to the extent to which it does not conflict with the Constitution or any other statutory law.

To this day the right to search for, extract, and dispose of, minerals in Namibia is based on the principles contained the aforementioned German statutes (the Mining Consolidation and Amendment Proclamation 4 of 1940; the Mines, Works and Minerals Ordinance 20 of 1968; the Mineral Rights Proclamation AG 57 of 1978; Minerals (Prospecting and Mining) Act 33 of 1992; the Petroleum (Exploration and Production) Act 2 of 1992).

By contrast, in South Africa, due to the influence of superficies solo cedit (ownership of buildings of others on land passes to the owner of the land) and cuius est solum, eius est usque ad caelum et ad inferos (the owner of the land is the owner of that above and below the surface of the land), the development of the mineral and mining laws took a course fundamentally different to the development in Namibia as mentioned above. The owner of the land is the owner of the minerals therein. By consent of the owner the right to search for, extract, and dispose of, the minerals may be transferred by the owner of the land to another, for example, by a notarial mineral lease. The lessee in terms of the mineral lease thereby holds title to the mineral separate from the title to the land. The lessee in terms of the mineral lease may transfer the rights in terms thereof without the consent of the lessor, who as owner of the land initially transferred to the lessee the mineral right separating it in title from the title of the land. The mineral lease provides the lessee or holder thereof with a real right in the nature of a servitude against the land containing the mineral, as opposed to a personal right against the lessor who as owner of the land initially transferred the mineral right to the lessee. Therefore, the lessee or holder of the mineral right may exercise the right to exploit the mineral against whoever is the owner of the land, be it the initial lessor or another, without the latter’s consent. This position was fundamentally changed in South Africa by the Mineral and Petroleum Resources Development Act 28 of 2002, which came into operation on 1 May 2004.

Section 2 of the Minerals (Prospecting and Mining) Act 33 of 1992 (“the Minerals Act”) provides that, subject to any right conferred under any provision of that Act, any right in relation to the reconnaissance or prospecting for, and the mining and sale or disposal of, and the exercise of control over, any mineral or group of minerals vests, notwithstanding any right of ownership of any person in relation to any land in, or under which any such mineral or group of minerals is found, in the State.

Accordingly, any right to search for, extract, or dispose of, any mineral in Namibia is derived from the State according to the Minerals Act. Such right may be held as:

(i)    licensee of a non-exclusive prospecting licence, the holder of a mining claim certificate, or licensee of a mineral licence

        (reconnaissance licence, exclusive prospecting licence, mining licence or mineral deposit retention licence); or

(ii) (a) transferee of a mining claim, exclusive prospecting licence, mineral deposit retention licence, or mining licence; or

      (b) grantee, cessionary or assignee of any interest in any such claim or licence; or

      (c) joint holder of any such mining claim, licence or interest.

In writing this I consulted the following sources: Hugo Meyer van den Berg, Mineral Rights under Development: A Comparative Study of the Evolving Nature of Mineral Rights in South Africa and Namibia, LLM Thesis at the University of Cape Town, 17 August 2009; Hanri Mostert and Meyer van den Berg, Roman Dutch Law, Custodianship, and the African Subsurface: The South African and Namibian Experiences, in Donald N Zillman, Aileen McHarg, Adrian Bradbrook and Lila Barrera-Hernandez (eds), The Law of Energy Underground: Understanding New Developments in Subsurface Production, Transmission, and Storage, Oxford University Press, April 2014; Agri SA v Minister for Minerals and Energy 2013 (4) SA 1 (CC) [7]-[12]; Aussenkjer Diamante (Pty) Ltd v Namex (Pty) Ltd and Another 1980 (3) SA 896 (SWA) 903B-D; Consolidated Diamond Mines of South West Africa Ltd v Administrator, SWA and Another 1958 (4) SA 572 (A); HR Hahlo, The Great South West African Diamond Case: A Discourse, 1959 (76) SALJ 151; Namibia Grape Growers and Exporters Association and Others v The Ministry of Mines and Energy and Others 2004 NR 194 (SC); Rostock and Another v Van Biljon 2011 (2) NR 751 (HC)).