POLICIES that give effect to the constitution could be threatened by a compensation claim brought against SA by foreign mining companies, say four nongovernmental organisations (NGOs).

The NGOs - including the Centre for Applied Legal Studies and the Legal Resources Centre - have been allowed to take part in an international dispute between SA and Italy's Red Graniti and Luxembourg's Finstone corporations.

The investors seek €266m in compensation for what they claim is an effective expropriation of their mineral rights through SA's Mineral and Petroleum Resources Development Act.

The dispute will be arbitrated in April by a tribunal under the World Bank's International Centre for Settlement of Investment Disputes. Its decision could have serious consequences for SA's developmental objectives. A successful claim could pave the way for future claims and require the act to be amended.

The claimants argued that the act - which requires an environmental protection plan and the achievement of broad-based black economic empowerment targets - was a violation of SA's investment treaties.

But the NGOs say a successful claim could "severely impinge upon government's policymaking space".
The NGOs will assist the tribunal in interpreting the treaty and the act in the context of SA's constitution and international human rights law.