(TIMES) Zamtel sale was illegal

Zamtel sale was illegal
By Times Reporter

THE commission of inquiry appointed to investigate the sale of Zamtel and Finance Bank Zambia Limited yesterday heard that the sale of Zamtel was not done in accordance with the law. The commission also failed to proceed with investigations into the sale of Finance Bank Zambia because the matters that it was supposed to probe were before the courts of law.

Making submissions to the commission of inquiry in Lusaka yesterday, Transparency International Zambia (TIZ) executive director Goodwell Lungu said the then minister of Communications and Transport, Dora Siliya did not follow the procedure in the sale of the telecommunications company.

Mr Lungu alleged that Ms Siliya breached various laws, which prompted his organisation to write to former president Rupiah Banda over the manner in which the sale of Zamtel was handled. He alleged that Ms Siliya singled-sourced RP Capital Partners to evaluate Zamtel assets without following tender procedures.

“The mere fact that the former minister single-sourced PR Capital to evaluate the Zamtel assets without following tender procedures was in itself a breach because RP Capital Partners was not registered with a relevant authority in Zambia", he said.

He explained that the then minister of communications engaged RP Capital Partners to evaluate the assets of Zamtel when it was not registered with the Evaluation, Surveys Registration Board.

Mr Lungu said it was clear that the manner in which RP Capital Partners was selected was against the provision of the Public Procurement Act. He said when TIZ carried out it own investigations to ascertain whether RP Capital Partners had the expertise to carry out an evaluation on Zamtel, there was no data relating to such expertise.

Mr Lungu also said former President Banda’s son, Henry allegedly introduced RP Capital Partners to a local firm known as Pangea Securities in a bid to have the firm jointly carry out the evaluation of Zamtel but that Pangea declined the offer. When asked whether it was an offence for a foreign company to partner with a local firm, Mr Lungu said it was not except that a foreign company could not carry out an evaluation if it were not doing it jointly with a local firm. Mr Lungu also stated that another breach by the then minister was that the Memorandum of Understanding (MoU) related to the privatisation of the parastatal company was supposed to have been signed by the minister of Finance and not Ms Siliya.

He said his organisation and some civil society organisations which opposed the sale of Zamtel agreed with the then attorney general that the MoU, which was the preliminary stage leading to the final sale and transfer of assets of Zamtel, should have been signed by the minister of Finance. He said another breach by the then minister of Communication and Transport was that she went ahead to sign an MOU which was not substantially the same as the draft which the solicitor general had cleared for signing.

Mr Lungu said in the MOU that was signed by the minister, there was an insertion of a base floor amount of US$ 2million, which was not contained in the final draft the solicitor general had approved. He said Ms Siliya also signed the MOU committing the Government to a sum of money beyond her ministry threshold without the approval of the Zambia Public Procurement Authority.

TYIZ, Civil Society for Trade Network, Southern Centre for the Constructive Resolution of Disputes, Jesuit Centre for Theological Reflection, Citizens Forum, and Civil Society for Poverty Reduction were among those who objected to the sale of Zamtel.

And the commission chairperson Sebastian Zulu said the rule of justice demanded that Ms Siliya defends herself against the allegations levelled against her. He also said the commission would not proceed with the investigation into the sale of Finance Bank Zambia because the matter was before the courts of law.