Kasambara’s error: Macra, Malawi Mobile Ltd tussle over K42bn claim
Malawi Mobile Limited (MML), the country’s third cellular phone service provider licenced in April 2002, has commenced a legal battle at Supreme Court of Appeal, Blantyre against Malawi Communications Regulatory Authority (Macra), demanding it to pay it $133.7 million (K42 billion) as compensation for loss of revenue for unlawful cancelling of contract.
The appeal follows a High Court Commercial Division ruling by Judge Frank Kapanda on April 20 2012 that awarded MML US$66, 85 Million (K21, 376 Billion) as damages for ‘unlawfully’ cancellation of mobile licence agreement between MML and MACRA.
Macra in 2005 cancelled a renewed mobile licence agreement with MML following unlawful and unconstitutional action of then Attorney General (AG) Ralph Kasambara decision to suspend the Macra board and invalidating the resolutions of the board retrospectively.
Appeal Hearing
MML, which is run by Malawians with majority shares owned by South Africans, commenced the appeal on Monday with Macra lawyer, Kalekeni Kaphale SC dismissing the demands arguing the company has no basis to demand such money.
The Macra lawyer argues that MML has failed to provide written communication supporting its claim that there was extension of mobile licence agreement with MACRA.
Kaphale further argued that the company failed to prove its financial capacity as it had failed to roll out in Malawi within a period of three years after granted the licence.
“The company doesn’t need to claim such amount because it failed to prove its financial capacity. Three years after given the contract, it didn’t set up any structure in Malawi worth to demand such claim,” Kaphale argued while asking the court to nullify the lower court’s decision to award MML K K21, 376 Billion.
MML lawyer David Kanyenda is set to counter-argue on Kaphale’s presentation on Wednesday when the hearing resumes before the panel of three judges Andrew Nyirenda, Edward Twea and Richard Chinangwa.
If the court decides to uphold MML’s claims, then government will be forced to pay the company K42 billion which is equal to 10 percent of Ministry of Health’s allocation in this year’s national budget.
Background
Kasambara as AG then suspended the Macra’s board and any resolution made after 24th March 2005. However, his decision was challenged and reversed by the Constitutional Court.
The Constitutional Court noted that Kasambara fraudulently misrepresented the President of Malawi and usurped the president’s powers in terms of the Malawi Telecommunications Act by suspending the board, and ruled that he had no authority to represent the President after he failed to produce authorization letter backing his actions.
Following the Constitutional Court ruling, MML filed for damages at High Court Commercial Division and was awarded US$66, 850 Million (K21, 376 Billion) after Macra and AG did not call for witnesses. And now the company has re-appealed demanding US $133,700 Million (which is 42,784 Billion Kwacha) instead.
Kasambara also ordered the arrest of South Africa-based MML investor Petroklas Tsaperas, together with lawyer Khuze Kapeta and former MACRA chairman Abdul Pillane. They were charged with our counts ranging from uttering a suspended document to extend an agreement for MML, uttering a false document, to obtaining a document by false pretence and perjury. The ‘persecution’ did not succeed in courts.
MML registration
MML was registered as a Private Company under registration number 6375 at the Office of the
Registrar of Companies in Blantyre and a Mobile Telephone Licence, valid for 15 years, was issued to
MML on April 19, 2002 by MACRA.
The initial investment Capital outlay is US$15 million likely to increase to US$ 40 million in 10 years. The Company is owned by three investors namely Finanz Capital Management Private Limited of South Africa with 55 per cent Shares, Finanz Holdings Limited of Mauritius with 35 per cent Shares, and 3x Telecommunications with 10 percent Shares.
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