On June 22, Gold Fields Ltd., a South African mining company, announced that the SEC had concluded its investigation related to a mining license in South Africa and would not recommend that the SEC pursue an enforcement action against the company. According to Gold Fields, the investigation had been related to a 2010 Black Economic Empowerment (BEE) transaction associated with the granting of a mining license for the company’s South Deep operation — one of the largest gold deposits in the world. The BEE is a program launched by the South African government to give certain historically disadvantaged racial groups special economic privileges, including increased ownership opportunities. Under South African law, mining companies must sell or cede at least 26% of their operations to non-white citizens.
The investigation apparently centered on a $210 million BEE transaction involving the transfer of a roughly 10% stake in South Deep, a gold mine located near Johannesburg that is owned and operated by Gold Fields, to a black-owned group. In September 2013, Gold Fields had revealed that it was being investigated by the SEC following news reports that the company had bribed an African National Congress official, by increasing her “cut” from the BEE deal in order to get a license for the South Deep operation. The decision not to pursue an FCPA action against Gold Fields comes on the heels of the announcement earlier this month by Net 1 UEPS Technologies, Inc., a South African mobile payments company, that the SEC had closed without charges an FCPA investigation arising out of a contract with the South African Social Security Agency.