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Monday Feb 10, 2014

Director gets jail for land damage

A landmark judgment sentencing a company director to a prison term for breaking environmental laws has raised the pressure on South African corporates to comply with the law.

A court in Limpopo imposed a prison sentence on Matome Maponya, the managing director of Blue Platinum Ventures, on January 31 for causing environmental degradation. It was the first time in South African history such a ruling was made.

Maponya was sentenced to five years, suspended on condition he rehabilitate the damage, estimated at a cost of R6.8 million, within three months.

Blue Platinum Ventures had been mining clay outside the village of Batlhabine, Limpopo, since 2007, which resulted in environmental degradation.

It was the first time a company director was given a jail term for such a violation, even though legislation has provided for personal liability of directors for breaking environmental laws since 1998.

It has opened the gate for more such rulings. 'It is sending a strong message that no one will remain untouched... We are working hard with the law enforcement agencies to ensure that we have more cases going this route in future,' Albi Modise, the spokesman for the Department of Environmental Affairs (DEA), said.

While the department did not want to be seen as upsetting job creation efforts, it wanted private companies to respect the country's environmental laws like any other laws.

Maponya was not given the option of a fine. In the past, directors found guilty in their personal capacities have only paid fines. 'The imprisonment without an option of a fine is likely to change the way companies look at environmental issues,' said Terry Winstanley, a director and national head of the environmental practice at Cliffe Dekker Hofmeyr.

'[Decision makers] will probably give them more weight. Personal liability could arise not just for directors but anyone who has some sort of control over the environmental impacts of a business.'

As a result of this ruling, companies were likely to make greater allocations of financial and human resources to environmental management and compliance, she said.

Shareholder activist Theo Botha said listed companies would note that they needed to attend to environmental matters and not shift the blame.

'There are a lot of cases like the acid water in the West Rand where big companies sold to smaller companies and then there was no one to blame. This will change that. It will create heightened awareness, especially in mining.' Such a ruling was long overdue, he said.

A not-for-profit organisation from Batlhabine, near Tzaneen, brought the illegal mining to the attention of the Department of Mineral Resources in 2010. It did not act, and the organisation laid criminal charges against the six directors of Blue Platinum Ventures. They appeared in the Naphuno Regional Court for the first time in August last year.

People living around Nkomati Anthracite's operations also had a sweet victory last year when the company, which is 60 percent owned by JSElisted Sentula Mining, pleaded guilty to transgressing the National Environmental Management Act. It was fined R1 million and agreed to pay R4m to the DEA's Environmental Management Inspectorate.

'This is something that is welcomed and long overdue specifically within the mining industry,' said Bobby Peek, the director of environmental justice NGO groundWork. 'However, there is a legacy staring us in the face, as mining activities that destroy the environment and people's well-being often go 'unnoticed' by the authorities. Mines often operate without the required licences, and acid mine drainage and coal dust continue to be ignored by authorities.

'We need to find ways of stricter enforcement of the law on all mining sectors.'

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