Copper 'reclassification' would hammer shippers and transporters

Proposals to have copper declared a precious metal could have “wide-reaching and perhaps severe consequences” for the freight industry, according to Stephne Kleinloog, associate attorney at Norton Rose Fulbright. For those in the import and export industries, Kleinloog advises that the import/ export of a precious metal is a procedure that is legislated, and for which certain permits or approvals from the national treasury need to be obtained. And for the transporters there is an equal forest of legislative procedures in their way. “In the event that copper is declared by the Minister to be a precious metal in terms of the act, the provisions of immediate interest to the transport sector are Section 13 of the act as well as Regulation 26 of the precious metal regulations declared under the act,” Kleinloog told FTW. And, by way of background, she added, the act provides for an exhaustive list of categories of people who may acquire, possess or dispose of either unwrought or semi-fabricated precious metals – including holders of a refining licence, holders of a beneficiation licence, an authorised dealer, a producer, a person holding a certificate from the regulator, a holder of a special permit, and a jeweller’s permit. “Any person falling outside the list (save for a person in possession of such precious metal in fulfilment of a contract of employment with any such authorised person) is prohibited from doing so,” she added. And this is where the act deals out drastic penalties for contraventions of certain provisions. “For example, if an unauthorised person is found to be in possession of such precious metal, or buys precious metals without having satisfied themselves that the vendor is lawfully entitled to sell such precious metal, then a person is guilty of an offence,” said Kleinloog. “They are liable to a fine not exceeding R1m or to imprisonment for a period not exceeding 20 years or to both such fine and imprisonment.” And a transporter who contravenes that unlucky Section 13, and conveys or transports a precious metal without the required documentation, also gets slammed. They could get hit for a fine up to R500 000 or to imprisonment for up to 10 years, or both. The act also confers the power on the SA Police Services (SAPS) to enter and search any premises at any reasonable time, without prior notice and without a warrant if there are reasonable grounds to believe that a warrant would be issued, provided they obtain a warrant to do so. And “premises” specifically include any vehicle, aircraft, ship or other means of conveyance. “Transporters will be subject to extra scrutiny by police. And, to avoid the hefty fine or imprisonment, they will need to be meticulous in obtaining and carrying the relevant information (contained on the waybill).” And she also said it was “debatable” whether a declaration of copper as a precious metal would curb cable theft to the desired extent. “Although the declaration would lend itself to punitive convictions for unlawful possession of copper, the lack of regulation and implementation, and proper policing, could render this declaration entirely superfluous. “At the same time, imposing stringent obligations on those involved in the copper or scrap industry, and the related transport and warehousing industries, could ultimately be detrimental to businesses involved in these industries.” To curb a problem using such a big stick requires that stick “to be wielded ruthlessly and effectively”, she added. “The failure to do so neuters the deterrent contained in the hefty fines and lengthy prison sentences.” So it’s watch-out time if copper becomes “as good as gold”. INSERT & CAPTION A transporter who contravenes the law could get hit for a fine up to R500 000 or to imprisonment for up to 10 years, or both. – Stephne Kleinloog