Sasol Form 20-F for the year ended 30 June 2021 - Book - Page 31
and other factors, we may be required to modify or
withdraw certain products from the market, which
could have a material adverse effect on our business,
operating results, cash flows, financial condition and
reputation.
Chemicals (GHS) through the Department of
Employment and Labour’s Hazardous Chemical Agents
Regulations promulgated on 29 March 2021.
At Sasol systems and processes are in place,
monitored and improved upon, to ensure our
compliance with laws and regulations applicable to
Sasol and its obligations upstream and downstream in
the value chain. However, we cannot assure you that we
will be in compliance with all laws and regulations at
all times. For example, non-compliance with
environmental, health or safety laws may occur from
system or human errors in monitoring our emissions of
hazardous or toxic substances into the environment,
such as the use of incorrect methodologies or defective
or inappropriate measuring equipment, errors in
manually capturing results, or other mistaken or
unauthorised acts of our employees or service
providers.
For example, the fast growth of plastics,
combined with challenges in effective waste disposal,
has resulted in a global problem associated with plastics
waste in the environment. The main source of the
problem is identified as short-life consumer packagingtype applications, often referred to as single-use
plastics. Consumer and regulator sentiment regarding
the plastic pollution challenge may pose future
responsibilities and business constraints on the wider
industry, including Sasol, through bans on certain
polymer product applications, production restrictions
and reduced demand for polymers where alternatives
are perceived to be more acceptable to the markets they
serve. The DFFE promulgated the Extended Producer
Responsibility regulations which may result in
additional financial obligations together with various
other responsibilities for Sasol.
There is growing public opinion and
awareness of public health and safety associated with
the manufacturing and use of chemicals and industries
reliant on fossil fuels. Challenges are also increasingly
being raised on these issues. Our manufacturing
processes may utilise and result in the emission of or
exposure to substances with potential health risks. We
also manufacture products which may pose safety,
health and environmental risks. We remain committed
to apply a duty of care principle and implement
measures to eliminate or mitigate associated potential
risks, including through our commitment to the
Responsible Care® program and adoption of the GHS.
However, we may be subject to liabilities as a result of
the use or exposure to these materials or emissions.
Non-governmental organisations, activists and other
stakeholders increasingly use environmental, health and
safety permitting processes, including ours, to
challenge a company's practices to promote greater
environmental sustainability in its operations and value
chain. We expect this kind of participation to increase
over time, which could impede our ability to obtain
new or renewed permits or result in more stringent
standards imposed in them. See “Item 4.B—Business
overview—Regulation” for more detail.
We are subject to risks associated with litigation and
regulatory proceedings
As with most large corporations, we are
involved from time to time as a party to various
lawsuits, arbitrations, regulatory proceedings,
investigations or other disputes. Litigation, arbitration
and other such legal proceedings or investigations
involve inherent uncertainties and, as a result, we face
risks associated with adverse judgments or outcomes in
these matters. Even in cases where we may ultimately
prevail on the merits of any dispute, we may face
significant costs defending our rights, lose certain rights
or benefits during the pendency of any proceeding or
suffer reputational damage as a result of our
involvement. We are currently engaged in a number of
legal and regulatory proceedings and arbitrations in
various jurisdictions including the litigation relating to
the Sasol Khanyisa B-BBEE transaction described
under “Item 3.D—There are country-specific risks
relating to the countries in which we operate that could
adversely affect our business, operating results, cash
flows and financial condition—(a) Political and socioeconomic issues—ii. Transformation and local content”
and the Sasol Financing International Limited (SFI) tax
proceedings described under “Item 3.D —There are
country-specific risks relating to the countries in which
we operate that could adversely affect our business,
operating results, cash flows and financial condition—
(c) Legal and regulatory—ii. Tax laws and regulations”,
We recognise that evolving chemicals control
regulations globally may require additional product
safety evaluations with the potential for restrictions on
product uses. Consequently, markets may apply
pressure on us concerning certain of our products,
feedstock, manufacturing processes, transportation and
distribution arrangements. As a result of these
additional pressures, the associated costs of compliance
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