South African court orders Zambia to halt liquidation of Vedanta unit assets
South Africa’s High Court today granted Vedanta Resources an urgent interdict, halting the liquidation of its Konkola Copper Mines (KCM) unit in Zambia until a final decision is made through arbitration.
Vedanta has been locked in a dispute with the Zambian government since May when it appointed a liquidator to run KCM, which is 20% owned by Zambia’s state mining company ZCCM and the rest by Vedanta. Zambia accused KCM of breaching the terms of its licence.
The dispute in Africa’s second-largest copper producer has intensified concerns among international miners about resource nationalism in Africa.
Mumbai-listed Vedanta denies that KCM has broken the terms of its licence and says it will defend its assets in the southern African country.
South African High Court Judge Leicester Adams said on Tuesday in a ruling seen as a big win for Vedanta that wind-up proceedings must be immediately withdrawn until a final decision is made following arbitration.
“Pending the final determination of the arbitration, the first respondent is interdicted and restrained from taking any further steps in the furtherance and prosecution of the winding up proceedings,” he said.
Vedanta welcomed the decision and said it was committed to resolving the dispute. The legal counsel for ZCCM declined to comment. It was not immediately clear whether this ruling will be binding in Zambia.