Staff Reporter
BUSINESSMAN Mutumwa Mawe-re has roped in foreign embassies in a bid to recover assets expropriated by the government in 2004 under a controversial Reconstruction Act.
Mawere’s South African lawy-ers, Kyle Attorneys, have petitioned Britain’s ambassador to Zimbabwe, Deborah Bronnett, saying the expropriation of their client’s English companies pose risks to all foreign interests in Zimbabwe, a prima facie case for embassies and interested parties to awaken potential investors on the possible take-over of their firms.
The businessman, who is now a naturalised South African, said other diplomats should join in the campaign to expose what he termed “toxic” legislation and the alleged complicity of the Zimba-bwean judiciary in undermining the rule of law and property rights in endorsing the take-over of foreign firms.
Mawere said on September 6, 2004, the government used state of emergency powers to take over two of his companies; a move that was further ratified using the Reconstruction of State-Indebted Insolvent Companies Act.
He said the two companies — Shabanie-Mashava Mines (SMM) Holdings Limited and THZ Holdings Limited — are British registered and thus foreign firms.
The businessman’s lawyers said their client challenged the constitutional validity of the reconstruction legislation, but to their surprise the Zimbabwean Supreme Court ruled that the law is valid.
Parliament has since been approached to review and possibly repeal the whole legislation on grounds that it serves no legitimate purpose, the communication added.
The Parliamentary Committee on Justice and Legal Affairs has also resolved to review Presidential powers.
Among the excesses of the reconstruction legislation that were cited was that it authorises and permits no-notice seizure of property and allows the government to take-over property without proof that the debtor was indeed indebted to it.
The law was also condemned for facilitating the appointment of an administrator with plenary powers that go beyond the normal powers of a liquidator and shifts the burden of proof of innocence to the property owner.
Unlike ordinary civil processes of execution where debtors’ assets are only seized following a court judgment, in his petition, Mawere said the Reconstruction Act authorises the government to take the law into its own hands, turning it into a judge in its own case.
“Based on the above, we believe that a prima facie case exists for your intervention as the affected companies are domiciled in the UK. It may very well be the case that other foreign registered companies may not be aware of the implications of the legislation and we, therefore, look to your intervention to ensure that the information is disseminated to all interested parties as a precedent has already been created,” reads part of Mawere’s correspondence to the British ambassador.
“We believe that the existence of the legislation threatens all foreign interests in Zimbabwe. Accordingly, please feel free to circulate the correspondence to other embassies and interested parties so that they are informed about the risks of doing business in Zimbabwe. If it can happen to two English companies, then surely, no one is safe.”
The businessman said he was concerned at the local judiciary’s alleged tolerance of behaviour that undermined the security of investment in Zimbabwe.
He added that the legislation has retrospective application and this alone should raise a red flag to foreign investors.
Last year, President Robert Mugabe transferred the running of SMM from the Ministry of Justice and Legal Affairs to the Mines and Mining Development Ministry. Mawere is opposed to the move.
Parliament has since set up a committee on privileges to probe the conduct of SMM administrator, Afaras Gwaradzimba, on possible contempt of Parliament following statements lawmakers deemed to have been aimed at undermining their work.
Defence Minister, Emmerson Mnangagwa, was appointed as a member of the privileges committee, drawing further objections from Mawere, who contested that the ZANU-PF Chirumanzi-Zibagwe House of Assembly member might not be impartial.
Recently, Mnangagwa wrote to the Speaker of the House of Assembly, Lovemore Moyo saying he was stepping down and proposed to have ZANU-PF chief whip, Joram Gumbo, as his replacement.
The Defence Minister accepted that he has had meetings with Gwaradzimba and Justice and Legal Affairs Minister, Patrick Chinamasa, prior to the constitution of the probe team.
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