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South African Iron and Steel Institute and Others v Speaker of the National Assembly and Others (NEMLAA matter)

22 June 2023

The judgment of the Constitutional Court in South African Iron and Steel Institute and Others v Speaker of the National Assembly and Others [2023] ZACC 18 is available here.

  • Coram: Maya DCJ, Kollapen J, Madlanga J, Majiedt J, Makgoka AJ, Mathopo J, Potterill AJ, Rogers J and Theron J
  • Heard: 21 February 2023
  • Unanimous judgment by Mathopo J delivered on 26 June 2023

Outcome:

On application for direct access to the Constitutional Court:

It is declared that Parliament has failed to comply with its constitutional obligation to facilitated public involvement in terms of sections 59(1)(a) and 72(1)(a) the Constitution in respect of the following provisions of the National Environmental Management Laws Amendment Act 2 of 2022:

  • The amended definition of “waste” in section 61(k);
  • The new definition of “commercial value” in section 61(c);
  • The new definition of “trade in” in section 61(j); and
  • The transitional provision in section 88.

The said provisions are accordingly declared invalid and unconstitutional. The first and second respondents are directed, jointly and severally, to pay the applicants’ costs, including the costs of two counsel.

Summary:

This matter concerned an application for direct access to the Constitutional Court brought by the South African Iron and Steel Institute and other parties in the steel and fertilizer industries. The Applicants alleged that Parliament had not adequately facilitated public participation, as required in sections 59(1)(a) and 72(1)(a) of the Constitution, in the processing of the National Environmental Management Law Amendment Act 2 of 2022 (the Bill).

The amendments at the centre of the challenge pertained to the definition of “waste” in the National Environmental Management: Waste Act 2 of 2022 (Waste Act) and a number of other related changes.

The Applicants averred that material amendments to the definition had been introduced to the Bill after the public participation phase and only in the Parliamentary committee process, without proper public participation. These amendments were only found in later versions of the Bill (the E-List and F-Bill versions of the Bill). The Applicants argued that these amendments were substantially different from previous versions on which the public had been given the opportunity to provide comments.

The amendments in question had resulted from a proposal brought by the Department of Forestry, Fisheries and the Environment, which was subsequently accepted by Parliament and incorporated during the NCOP process of passing the law.

The Applicants argued that the expansion of the definition of “waste” as reflected in the F-version adopted by Parliament would expand the regulatory scope of the Waste Act by including by-products and co-products not previously classified as “waste.” They argued that this would force manufacturers to treat valuable co-products or by-products resulting from the production of the main product as “waste.” Furthermore, the Applicants argued that a failure to comply with the requirements of the Waste Act carries severe consequences – any person who conducts a waste management activity without a license or in contravention of the prescribed standards (which would be informed by the amended definition of “waste”) commits an offence and is liable for imprisonment for up to 10 years or a fine up to R10 million, or both. The Applicants argued that the substantial amendments could have severe industry consequences and argued that their repeated calls for further public participation and consultation processes on these changes had been ignored.

Despite these calls, the Amendment Act (containing the expanded definition of “waste”) was passed by Parliament.

In considering whether Parliament fell short of its constitutional obligation to facilitate public participation in the processing of the Bill, the Constitutional Court was called upon to determine whether the impugned amendments were material, and whether the impugned amendments required further public consultation.

The Court considered the purpose of public participation, namely granting the public an opportunity to influence the decision-making processes on issues that stand to affect them. The Court viewed it as part of Parliament’s obligation to involve those who are likely to be affected by proposed legislation. Section 42(1) of the Constitution and Parliament’s public participation model (recently also referenced by the Constitutional Court in Mogale and Others v Speaker of the National Assembly and Others where the Court also found Parliament wanting as far as the standard of public participation facilitated) meant that Parliament had a responsibility to:

  1. ensure its public participation includes education; and
  2. create meaningful opportunities for the public to participate in its decision-making on issues which affect them.

The court found that the process must include reporting, feedback, monitoring and evaluation so that outcomes are tracked to ensure effective public participation. The Constitutional Court emphasised that Parliament has an obligation to ensure that the views of the public have been taken seriously, that they matter and have been given due consideration in its decision-making in a meaningful manner. Thus ensuring a fair, reasonable process during which the affected public is given a voice.

The Court looked at the definition of “waste” before and after the amendments, and concluded that the definition reflected in the F-Bill (which Parliament passed) was far more expansive than the definition reflected in the D-Bill which was consulted on. The Court found that the changes in the definitions between versions of the Bill were material. The Constitutional Court referred to the standard set in South African Veterinary Association v Speaker of the National Assembly where the National Assembly was found to have failed to consult the public on a material amendment. In this matter, the material amendment was found to have the potential to have a lasting impact on the professional operations of veterinarians, much like the potential adverse impact the expanded definition of “waste” could have on the steel and fertilizer industries.

The Constitutional Court held that even though Parliament has a discretion to determine the manner in which it chooses to facilitate public participation, it fell short of meeting its constitutional obligation in this instance because:

  • the standard for adequate public participation is reasonableness;
  • the Court found no evidence that Parliament took any measures to bring the public’s attention to the changed definitions; and
  • the relevant industry role players’ requests to be heard on the impugned amendments had been ignored.

The Constitutional Court held that there was no legitimate basis for Parliament to dispense with further public participation in respect of the impugned amendments and that Parliament’s failure to hold further public hearings thereon was contrary to its constitutional obligations to facilitate public involvement. The court ruled that impracticalities or the cumbersome nature of the facilitation of public participation at numerous or late stages of the Parliamentary legislative process was not a justification for Parliament to not meet its constitutional obligation.

Note that President Ramaphosa only brought into operation select provisions of the National Environmental Management Laws Amendment Act 2 of 2022 when he published the commencement proclamation on 30 June 2023. The judgment of the Constitutional Court in this matter stands, and therefore the definitions which were the subject of this court case remain unamended by National Environmental Management Laws Amendment Act 2 of 2022.

The Department of Forestry, Fisheries and the Environment has indicated that it intends to initiate a new Bill to effect amendments to the current definition of “waste” and new definitions for “commercial value” and “trade in.” As interim remedial action, the Department has indicated it intends to publish a section 80(4) and 82 Notice in terms of the Waste Act to address facilities that predate the Environment Conservation Act and the Waste Act.