52
REPUBLIC OF SOUTH AFRICA
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
CASE NUMBER: 007566/2022
(1) REPORTABLE: NO (2) OF INTEREST TO OTHER JUDGES: NO (3) REVISED. 19 JULY 2023 DATE SIGNATURE
In the matter between:
TELKOM SA (SOC) LTD APPLICANT
and
PRESIDENT OF THE REPUBLIC OF FIRST RESPONDENT
SOUTH AFRICA
THE SPECIAL INVESTIGATING UNIT SECOND RESPONDENT
THE MINISTER OF COMMUNICATIONS AND THIRD RESPONDENT
DIGITAL TECHNOLOGIES
DR EDWARD GEORGE SCOTT FOURTH RESPONDENT
JUDGMENT
TLHAPI J
INTRODUCTION
[1] The applicant seeks to review and set aside a decision by the first
respondent, Mr Matamela Cyril Ramaphosa (“the President), to issue a proclamation
published on 25 January 2022, giving effect to Proclamation 49 of 2022 (“the
Proclamation”), issued under Government Notice No. 45809. The Proclamation was
issued in terms of section 2 of the Special Investigating Units and Specia Tribunal
Act 74 of 1995 (“the SIU Act”). The second respondent, the Special Investigating Unit
(“the SIU”) was authorised to investigate certain allegations made against the
applicant (“Telkom”). Telkom further seeks to set aside the investigation by the SIU
which had already commenced. The application is opposed by the first, second and
third respondents.
[2] The preamble1 to the SIU Act empowers the SIU to investigate malfeasance
in state institutions, state assets and public money and improper conduct by any
person that may seriously harm the interests of the public. The President in terms of
section 2 (1) of the SIU Act ‘may whenever he or she deems necessary establish
special investigating units or special tribunals on account of any of the grounds
mention in subsection (2).
[3] The Proclamation2 mirrored sections 2(2) (a-g) of the SIU Act 74 of 1996 by
substituting where ‘state institution’ is stated, with the word Telkom and, by
empowering the SIU to investigate alleged:
“2.1 serious maladministration in connection with Telkom; (section 2(2)(a))
2.2 Improper or unlawful conduct of employees, officials or agents of Telkom;
(section2(2)(b))
2.3 unlawful appropriation or expenditure of public money or public
property;(section 2 (2)(c))
2.4 unlawful irregular or unapproved acquisition act; transaction;
measure or practice having a bearing of the State property; (section
2(2)(d)
2.5 intentional or negligent loss of public money or damage to public
property; (section 2(2((e))
2.6 offence referred to in parts 1 to 4, or sections 17, 20 or 21 (in so
far as it relates to the aforementioned offences) of Chapter 2 of the
Prevention and Combatting of Corruption Activities Act 12 of 2004 and
which were committed in connection with the affairs of Telkom; (section
2(2)(f)), or
2.8 unlawful or improper conduct by any person, which has caused or may
cause serious harm to the interests of the public or any category thereof;
(2(2)(g)
The timeframe was between 1 June 2006 to date of publication of the Proclamation,
or prior to 1 June 2006, or after the date of publication of the Proclamation.” The
schedule3 to the Proclamation identified the matters to be investigated.
[4] In the parties joint practice note the following issues for determination were
identified:
“2.1 Whether the President’s decision to issue the Proclamation constitutes
administrative action in terms of the Promotion of Administrative Justice
Act 3 of 2000 (“PAJA”)
2.2 Whether Telkom is a state institution as defined in the Special
Investigating Unit and Special Tribunal Act 74 of 1996 (“the SIU Act”).
2.2.1 Whether Telkom is a public entity as defined in the Public
Finance Management Act 1 of 1999 (“PFMA”).
2.2.2 Whether the State has a material financial interest in Telkom
2.3 Whether the jurisdictional requirement to rely on section 2(2)(g) of the
SIU Act have been met.
2.4 Whether the President provided ex post facto rationalisations for his
decision to issue the Proclamation.
2.5 Whether the President abdicated his duties under the SIU Act
2.6 Whether the Proclamation is overbroad and vague.
2.7 Whether the President had sufficient facts before him that enabled him
to deem it necessary to refer the allegations for investigation.
2.8 Whether the President acted in a procedurally fair or procedurally
rational manner.
2.9 Whether, even if there was an irregularity in the process leading up to
or in the President’s decision to issue the Proclamation, the matter
should be remitted to the President to be decided afresh and pending
his decision, whether any declaration that the investigation conducted
by the SIU is invalid or otherwise unlawful should be suspended.”
[5] Prior to this application being opposed, Telkom launched an urgent application
seeking an order to declare a notice issued by the SIU on 3 August 2022, in terms of
sections 5(2)(b) and (c) of the SIU Act, unconstitutional alternatively, that it be
suspended pending the outcome of this application. A consent order was granted
doing away with Part A, and among the orders on how the matter was to proceed
further, was an order providing that if this application favours Telkom then, the SIU
shall return all documents obtained from Telkom.
Part B of the application
[6] Before this court is Part B of the application. Telkom contends:
(i) that the Proclamation is ultra vires because the allegations ‘contained in
the Proclamation fall outside the purview of section 2(2) of the SIU Act;
(ii) that Telkom did not fall ‘under any of the grounds in section 2(2)(a) to(f) of
the SIU Act;
(iii) the allegations referred by the President to the SIU lack the particulars
which are mandatory in terms of section 2(2)(g) of the SIU Act;
(iv) that the President acted without any grounds. The President acted
irrationally and arbitrarily by authorising vague allegations formulated in
the widest possible terms, covering a period of some 15 years and, he
failed to take into consideration that some of the allegations had been fully
investigated. There was no rational purpose to a fresh investigation.
(v) that item 1(b) of the Schedule to the Proclamation is overly broad and
lacks sufficient particularity. There being no limitations set to the authority
of the President to instruct an investigation, the statute has to be narrowly
interpreted to avoid abuse and to ensure that the President acts within the
confines of the Constitution.
(vi) that the decision of the President taken in terms of national legislation
constitutes administrative action in terms PAJA. The decision has an
external legal effect. The consequences of subjecting a JSE listed entity to
such a publicised investigation wiped out a significant value for Telkom
which caused billions of rands in shareholder value.
(vii) that the President failed to invite representations from Telkom as he was
bound to do under PAJA, that is, to call for representations before
instructing an investigation into the affairs of Telkom.
(viii) that procedural fairness was an ‘important constitutional safety valve to
ensure that the President acts lawfully and rationally’ when deciding to
subject a party to an investigation.
[7] Telkom contended that it was not a public institution as incorrectly believed by
the respondents for the following reasons:
(i) When posts and telecommunications were separated in 1991 Telkom was
established as a commercialised entity in terms of the Post Office Act of
1958 with Telecommunications residing under Telkom. It remained a wholly
state -owned enterprise till 1997 when it sold 30% of its equity interest to
Thintana Consortium.
(ii) On 30 March 2001 the government sold another 3% of its equity trust to a
South African company Ucingo Investments (Pty) Ltd. After Telkom’s
public offering of its shares on the JSE and New Your Stock Exchange, the
government still retained control over Telkom as a class A shareholder,
which status persisted for the duration of the initial public offering.
(iii) The class A shareholder rights expired in May 2011 and all shareholders,
government included ‘hold ordinary shares with corresponding rights
attached thereto.’ Presently the Government is not the majority
shareholder; it has 40.5% ordinary shareholding in Telkom.
(iv) The nomenclature of being a state-owned-company (“SOC”) was meant
to comply with the Companies Act. In the material sense it is not a state
owned company. Telkom is listed as a public entity in Schedule 2 of the
PFMA because it was listed as such when it was a public company. The
PFMA has not been updated.
(v) Telkom a ‘pure commercial entity’ has over the years applied for and has
been granted exemptions from the PFMA and from all Treasury
Regulations, for periods 9 November 2001 to 8 November 2004; 5
November 2004 to 4 November 2007; 26 October 2007 to 25 October
2013, followed by two further exemptions in 2013 and 2016 ‘which are
valid for as long as government does not exercise ownership control over
the business of Telkom or Telkom listed on the JSE.’
(vi) Telkom has applied for numerous exemptions from the provisions of the
PFMA which apply to state institutions, which exemptions allow Telkom to
‘act and trade as a commercial entity, it is without any governmental
oversight, financing and control.’
Facts Preceding the Proclamation
[8] The issue of the Proclamation was preceded by varied complaints against
Telkom by the fourth respondent (“Dr Scott”), a director of Phuthuma Networks (Pty)
Ltd (“Phuthuma”) and Phuthuma. The complaints related to the following:
8.1 The 2005 Tender: The tender was published on 23 September 2005 for the
replacement of telex switches. Phuthuma and another company were the
two bidders. The tender was cancelled on 19 October 2010 after Telkom’s
Procurement Review Council instructed that a more modern and cost –
effective solution should be sourced. The two bidders were notified of the
cancellation on 21 November 2005. Phuthuma requested a debriefing which
was acceded to by Telkom. This was followed by a complaint by Phuthuma
that Telkom had approached an overseas supplier Network Telex. Telkom
confirmed that this had occurred but only after cancellation of the tender.
During 2007 Telkom approached Network Telex on an urgent basis to provide
shore-to- ship services after British Telkom, which provided satellite links to
ships cancelled its agreement with Telkom. The services engaged were not
related to the 2005 tender and the value of the contract is in the region of
R60 000.00.
8.2 The 2007 Tender: This tender was published on 30 November 2007 and was
for outsourcing of telex infrastructure. Only two bidders had responded at
closure of the bid on 6 January 2008 being, Network Telex and Phuthuma. On
9 July 2009 the bid evaluation team recommended that the tender be awarded
to Network Telex. The tender was not awarded at all and the entire process was
put on hold after Phuthuma and Dr Scott lodged a complaint on 23 January
2009. Telkom commissioned an internal forensic investigation relating to
allegations of unfair practices in the tenders of 2005 and 2007 which were
looked into. What was established was that there was approval for the
emergency procurement of the shore-to-ship services by Network Telex.
Telkom had not entered into any contract with Network Telex for the providing
of telex or telegram services. Dr Scott was availed with a copy of the report.
8.3 The 2009 Phuthuma Action: Phuthuma instituted action in this court claiming
around R5.5 billion for damages allegedly suffered as a result of the award by
Telkom to Network Telex for the provision of telex and Gentex services. The
action is pending and has not proceeded to trial to date.
8.4 The 2010 Phuthuma Complaint: This was lodged with the Competition
Commission. It was alleged that Telkom had abused its ‘dominance and
engaged in anti-competitive conduct in the telegraphic and telex maritime
services market by unilaterally awarding services to Network Telex’. The
complaint was dismissed by the Competition Appeal Court.
8.5 The Independent Communications Authority (“ICASA”) Complaint: Telkom was
alleged to have transferred parts of its licence network to Network Telex without
prior approval. Dr Scott withdrew this complaint on 25 September 2014.
8.6 The 2012 and 2014 Complaint with the Johannesburg Stock Exchange
(“JSE”): In 2012 the complaint was about the failure to disclose in Telkom’s
financial statements Phuthuma’s complaint to ICASA. The complaint was
withdrawn on the basis that no disclosure was necessary. Dr Scott’s complaint
in 2014 was that the 2012 complaint to ICASA had been incorrectly resolved.
This complaint was resolved ‘on the basis that Telkom had not breached the
JSE Listing Requirements in relation to this disclosure’
8.7 Phuthuma’s 2011 Complaint filed with the South African Police Services
Directorate for Priority Crime Investigations and the Public Protector: With the
police Telkom’s conduct relating to the telex tender had to be investigated.
This investigation was not pursued. The Public Protector had to investigate
irregular outsourcing of telex services by Telkom and nothing has come out of
this complaint.
8.8 Dr Scott’s 2013 letter to Minister of Communications Yusuf Carrim: Various
allegations relating to the two tenders were levelled against Telkom. After the
then Group CEO’s feedback to the Minister no action was taken.
8.9 Dr Scott’s 2014 Complaint with the Competition Commission on behalf of
Datagenetics: Telkom was alleged to have committed several breaches of the
Competition Act 89 of 1998, which included the alleged irregular tender process
regarding Network Telex. A certificate of non-referral was issued and the
complaint was dismissed by the Commission.
[9] Between 2013 and 2018 Dr Scott made about ten requests to Telkom for
information in terms of the Promotion of Access to Information Act 2 of 2000 (“PAIA”)
relating to the two tenders and other matters, some were rejected because the
requested documents did not exist or because the information fell within the
protections afforded by PAIA.
[10] On 16 September 2014 Dr Scott addressed a letter of complaint against Telkom
to the President (President Jacob Zuma). The letter was referred to the Department
of Justice and Constitutional Development (“DoJ”) and forwarded to the SIU. The
complaints included allegations pertaining to (i) the 2005 and 2007 tenders; (ii)that
Bain & Co were appointed to provide advisory services without following proper
procurement processes; (iii) that Telkom sold iWayAfrica and Africa Online Mauritius
for a nominal consideration;(iv) that Telkom had squandered billions with the purchase
and sale of Multi-Links Telecommunications Limited.
The SIU applied to the then President (President Zuma) on 15 January 2015
for a proclamation to be issued, to empower it to investigate the complaints against
Telkom. This request was declined.
[11] On 21 August 2019, the SIU, in seeking support for its proposed investigation,
addressed a letter to the then Minister of Telecommunications and Postal Services.
The Minister was informed of the SIU’s intentions to request the President to issue a
proclamation to empower it to investigate the allegations of Dr Scot against Telkom. A
copy of the letter is annexed as “FA2” and accompanying it was a “motivation for
proclamation” document expanding on various Telkom’s business dealings which, on
allegations by Dr Scott needed to be investigated. Telkom was not invited by the SIU
for its views on the intended investigation. On 12 November 2020 the Minister
informed the Chairperson of the Board of Telkom (“the Chairperson”) Mr M S Moloko,
that she supported the SIU’s request and her letter is annexed as “FA3”.
[12] The preliminary view in the “motivation for proclamation” document by the SIU
was that Telkom was a state institution for purposes of the SIU Act, (was an organ of
state in the national, provincial or local sphere of government), that:
(i) notwithstanding the cancellation of the 2007 tender, there was concern
that an irregular relationship existed between Telkom and Network Telex,
where public money was used to benefit a private company instead of
being channelled to the South African Post Office (SAPO). The records
of Telkom and Network Telex had to be examined for irregular payments.
(ii) in as far as public sector procurement was concerned, the award of a
contract of R91 million to Bain & Co was to be tested against section
217(1) of the Constitution;
(iii) also of concern was whether the following companies had been sold for
a proper consideration being Telkom’s private sale of iWayAfrica and
Africa Online Mauritius to Gondwana International Networks for a
consideration of just $1 and Telkom’s purchase and sale of Multi-Links
Telecommunications (“Multi-Links”).
[13] Telkom contended that subsequently, concerning the proposed investigation, a
meeting was held between itself, the Ministry of Communications, the Office of the
Presidency and the SIU, however, this meeting was not called to enable Telkom to
give input to the President on whether he should issue the proclamation and, at no
stage was Telkom “under the impression that the President was minded to issue the
proclamation sought.” At such meeting Telkom undertook to provide more information
on the issues which were later addressed in a letter to the Chief Director: Legal
Services, Department of Communications and Digital Technologies. The letter dated
19 February 2021 is annexed as “FA4”.
[14] The Department of Communications sought legal opinion on whether Telkom
was a public entity for purposes of the Public Finance Management Act 1 of 1999
(“PFMA”). The Chief Law Advisor opined that Telkom fell under the scope of
investigation by the SIU as a listed company which fell under Schedule 2 of the PFMA,
the opinion is attached as “FA5”. The Minister’s view was that the opinion from the
Chief Law Advisor was erroneous. Telkom ‘was not a national public entity as it was
not substantially funded from the National Revenue or by way of tax, levy or other
money imposed in terms of national legislation nor is it a national government business
enterprise as the national executive no longer has ownership control over it. Her letter
is annexed as “FA6.
[15] The SIU sought further legal opinion from Advocate Motepe SC who opined
that Telkom could be investigated irrespective of whether it was a state institution as
defined in the SIU Act. His opinion is annexed as “FA7”. Telkom contends that there
was no referral of the issue to Telkom and that it does not possess ‘better evidence”
that the matter was decided under section 2 of the SIU Act.
[16] Telkom contended that for purposes of this application it does not meet the
description of a state institution as defined4 in the SIU Act, which provided that a state
institution was an institution in which the state had a financial interest. Telkom
contended that ‘the definition of a state institution in the SIU Act incorporates the
definition of a public entity in section 1 of the Reporting by Public Entities Act 93 of
1992,’ (“RPEA”). It was the definition of what a public entity was in the PFMA which
prevailed because the RPEA was repealed by section 94 of the PFMA.
[17] Telkom contended that it is not a juristic person or ‘under the control and
ownership of the national executive’ and it is not ‘funded by government national
business nor does it receive monies from government in terms of national legislation’
as defined in the PFMA5. Even though Telkom was established in terms of national
legislation, it is fully privatised and it is not the majority or controlling shareholder.
Although listed in Schedule 2 of the PFMA it does not meet the ‘substantive definition
of a national public entity’ in terms of the PFMA.
[18] Telkom contended that unlike the repealed RPEA which defined what ‘a
material interest’ was, the SIU Act did not define such interest. ‘A financial interest
meant more than a significant shareholding; required significant shareholding together
with the power to appoint directors; and significant expenditure of government funding
towards the entity and control by government’.
Legality and PAJA Grounds
[19] Telkom contended that the Presidents failure to refer investigation allegations
as contemplated in terms of section 2(2) of the SIU Act was reviewable under PAJA6
and/or the principle of legality in that it was ultra vires, not authorised by the
empowering legislation; was reviewable because it was materially influenced by an
error of law or fact7; reviewable under PAJA8 and or the principle of legality in that it
was taken for reasons not authorised by the empowering statute; reviewable in terms
of PAJA9 and or the principle of legality there being no rational connection between
the decision and the purpose for which the decision was taken; reviewable under
PAJA10 in that it was not procedurally fair and or the principle of legality in that it was
procedurally irrational.
[20] Telkom contended that the terms of reference in terms of section 2(3) of the
SIU Act were unduly wide, oppressive and almost impossible to comply with. ‘Item 1(b)
of the schedule which required an investigation into the broadband and mobile strategy
is widened by item 3.
[21] A key part of Telkom’s commercial business over a period of 15 years, where it
has engaged advisors has been referred for investigation. This is set out in paragraphs
1 and 2 of the Schedule, which permits an investigation into the unlawful conduct of
employees and any officials of Telkom or any other person or entity. Item 1 of the
schedule entails contracting and procurement into two broad themes for investigations
in telegraph and advisory services in Telkom’s mobile and broadband strategy. No
reasons for such a wide investigation are foreshadowed in the Proclamation.
Supplementary Affidavit
[22] Telkom filed a supplementary founding affidavit after receipt of the record
provided by the President in terms of Rule 53 of the Uninform Rules of Court. Having
reviewed the record Telkom contended that there were new grounds upon which the
Proclamation should be set aside. The President had abdicated his statutory role and
did not ‘apply himself to the necessity for the investigation and relied on the
unauthorised advice of the SIU and simply endorsed its decision. In doing so he
acted arbitrarily in authorising the investigation.
[23] Telkom contended that there was insufficient information in the record upon
which the President could reasonably and rationally have authorized an investigation
in terms of section 2(2) of the SIU Act. The record does not reflect specifically which
section of section 2(2) the President is relying on. There is no evidence to show how
the SIU determined that issues raised in Dr Scott’s complaint required an investigation.
There was no information on the record that justified an investigation in terms of
section 2(2)(g) of the SIU Act. Furthermore, the record does not reflect that Telkom
was given the opportunity to make representations to the President regarding the true
state of affairs. The Proclamation was issued on the incorrect belief that Telkom was
a state institution.
The SIU
[24] The SIU contended that the issue of the Proclamation was preceded by a
motivation it presented to the President regarding information received from Dr Scott.
It relied on the legal opinions advanced by the State Law Advisor and senior counsel
that Telkom was a state institution. The SIU contended that such status as defined in
the SIU Act was accorded to Telkom, it being an institution in which the State had a
material financial interest and, where the state was a majority shareholder during the
period where some of the conduct complained about occurred.
[25] The SIU contended that despite Telkom disavowing on various grounds as
stated in the founding papers, its characterisation as a state institution, the President
may under section 2(2)(g) of the SIU Act authorise an investigation into ‘unlawful or
improper conduct of any person which caused serious harm to the public or category
thereof. The motivation to the President explained in detail with credible allegations
how Telkom had paid out millions of rand which ought to have been paid to SAPO,
without following proper procurement process, this was allegedly backed by reams
and reams of supporting evidence’ that Telkom had paid out significant amount without
following proper procurement process.
[26] Although Dr Scott had furnished information, only three matters were proposed
by the SIU to be investigated. It was wrong in ‘law and logic’ to suggest that the SIU
should play no part in the President’s decision. In its preparation towards the
motivation, the SIU investigated the complaint, it scrutinized and sifted out those
complaints that merited investigation and it did so as it would be the entity ultimately
authorised to undertake the investigation. It was therefore, incorrect for Telkom to
assert that the President did not have before him the necessary information to decide
that the requirements of section 2(2)(g) had been satisfied, because, the President
had before him a detailed SAPO report, the Ministers of Justice’s submissions, the
updated motivation from the SIU and the legal opinion furnished by Motepe SC.
[27] The updated motivation also stated that after its application to the President in
2015 was declined, Dr Scott had provided further information and named a source
who was interviewed by the SIU. The source indicated that he/she was prepared to
cooperate with the SIU if a proclamation is issued. It was therefore incorrect for Telkom
to assert that the SIU ‘applied’ for the proclamation. The Minister recommended to the
President, supported by the motivation from the SIU.
[28] The updated motivation was identical to the 22 August 2019 version except,
that the updated motivation contained a complaint by Telkom, that it was not given an
opportunity to make representations before the President issued the Proclamation.
The SIU contended that Telkom was given an opportunity to meet with the Presidency
on 9 February 2021 to make representations in response to the 2019 motivation. This
occurred after Telkom had undertaken to engage with the SIU and the Minister.
[29] The SIU contended that when the President gave authorisation for the
publication of the Proclamation, he was exercising executive power as envisaged in
section 85(2)(e) of the Constitution and not implementing national legislation as
envisaged in terms of section 85(2(a) of the Constitution. The President was not
exercising administrative power, therefore, PAJA was not applicable. The SIU
contended further that Telkom failed to explain and set out facts why it had to be
treated differently and be given an opportunity to make representations.
[30] Telkom has in some matters confirmed that it was a state institution and the
courts have described it as ‘state owned’ or an ‘organ of state’.11 Furthermore, the SIU
contended that Telkom conceded that it was a PFMA-listed public entity, but seeks to
extricate itself from the PFMA placing reliance on the various exemptions granted in
its favour.
The President
[31] The President was presented with a view by the SIU and opinion of senior
counsel and the Minister that Telkom was a state institution. The President contended
that he considered both memoranda of the SIU and the Minister and he deemed it
necessary to issue the Proclamation as provided for in section 2(1) of the SIU Act, to
investigate the allegations identified by the Minister which he recommended were
serious and fell within the ambit of section 2(2). The President denied that the
Proclamation was ultra vires and that the allegations therein contained fell outside the
purview of section 2(2) of the SIU Act. The issues to be investigated were delineated
in the terms of the reference annexed as a schedule to the Proclamation.
[32] The President contended that the Schedule to the Proclamation allows the SIU
to investigate Telkom as a state institution (defined in the Act) in terms of sections
2(2)(a)-(f) of the SIU Act. The Proclamation included the investigation for the periods
prior to 2006 or after date of publication, concerning the same persons, entities or
contracts. As a state institution Telkom had a ‘monopoly over specified
telecommunications services which were in the public interest till 2005. Furthermore,
as contended in the founding papers, the state had a financial interest in Telkom till
May 2011.
[33] The President contended that the Proclamation specifically mentioned 2(2)(g)
of the SIU Act and that Telkom can be investigated under the section. The state has a
40.5% shareholding in Telkom. The SIU would investigate the serious harm that was
identified or investigate where there was a reasonable likelihood that serious harm
may impact upon the interests of the public, which would arise as a result of improper
contracting or procurement of telegraph services, including how public money was
lost. Consequently, the SIU required a broad scope to investigate allegations of
malfeasance. The SIU Act gave the President a wide discretion to determine what
was necessary to be investigated.
[34] The President denied that the Proclamation was too wide, vague, irrational,
arbitrary and lacked sufficient particularity on what was required to be investigated. At
the time that the Proclamation was issued there was insufficient detail on the issues
complained about and to require more facts would frustrate the purpose for which the
SIU Act was promulgated. However, the Proclamation identified with sufficient clarity,
being the procurement of telegraphic and advisory services, and the sale of three
entities.
[35] The President contended that the SIU memorandum which formed part of the
record gave more particularity regarding each of the instances of improper conduct.12It
was therefore incorrect to suggest that the Proclamation was not supported by alleged
facts.
Procedural Fairness / Rationality
[36] The President denied that the alleged failure to afford Telkom opportunity to
make representations was procedurally unfair and that it amounted to administrative
action to be governed under PAJA. The decision to issue the Proclamation did not
involve a determination of culpability and this did not have a direct or external legal
effect on the rights of any person as contemplated in the definition of ‘administrative
act’ in PAJA.
[37] Pertaining to the rationality of his decision the President contended that there
was nothing procedurally irrational about the procedure he undertook. The Rule 53
record revealed that he was informed by the memoranda of the SIU and the Minister
of past investigations and that what remained was a dispute as to whether the
investigations were adequate. He was informed that Dr Scott had directed the SIU to
a source who had further information and who was willing to cooperate with the SIU.
He was not in a position to make a determination of the merits of the matter.
Abdication and Content of Rule 53 Record
[38] The President contended that section 2(1) of the SIU Act empowered him to
take advice from SIU and the Minister and, to rely on the facts provided in the
memorandum of the SIU and the submissions of the Minister. He denied that the SIU
directed which matters to investigate.
[39] According to the President a complaint was ‘submitted to the Presidency which
was ultimately referred to the SIU. The SIU considered the matter, formed an opinion
that an investigation and referral was necessary, a memorandum was compiled giving
reasons for its views. The memorandum was referred to the Minister who made
submissions and advised him that he refer the matter to the SIU for an investigation.
He considered the information and advice and he was persuaded that he refer the
matter to the SIU for investigation in terms of the Act. The Rule 53 record contains
information placed before him and upon which he concluded that it was necessary to
refer the matter to the SIU for investigation.
[40] The President conceded that reference to ‘public entity’ in the SIU Act is now to
be read as reference to a public entity in the PFMA, however he does not agree that
Telkom is not a ‘public entity’ as defined in the PFMA because the Proclamation covers
a period where the state was the majority shareholder in Telkom, and was a state
institution till at least 2011.
The Minister of Communication and Digital Technologies
[41] The main contention was that Telkom was a state institution. It was contended
by the Director General on behalf of the Minister that it was important to distinguish
between what constituted the Government and what constituted the state and not to
conflate the two; that in terms of the Constitution the South African State had three
arms, the government, parliament and the judiciary. Under government was an array
of institutions which included ‘ministries, departments, agencies, commercial entities
or public entities’ each governed by national legislation.
[42] The Public Investment Corporation (“the PIC”) was a public entity which formed
part of the state and which fell under the oversight of the Minister of Finance. The PIC
had invested government employee pension funds which represented the
15.3%shareholding in Telkom. The latter shareholding added to the 40.51%
shareholding held by the Government of the Republic in Telkom, meant that the
Government had more than 50% shareholding in Telkom. Telkom was therefore a state
institution as defined in the SIU Act. It was contended further, that the fact that Telkom
had been exempted from the provisions of the PFMA did not detract from the legal
reality that it was a public entity and that it would remain so until the legislation is
amended.
Analysis of the Evidence
[43] Telkom submits that the SIU Act gives the President wide invasive powers of
the rights of individuals, hence the call for a narrow,13 rather than a broad interpretation
of the SIU Act. The SIU Act in terms of section 2(1) provides that the President may
whenever he deems it necessary on any of the grounds in subsection 2(2) establish a
Special Investigating Unit and Tribunal. Telkom relies on a narrow interpretation14
which it says outlines the grounds of review on ultra vires and will determine whether
the President acted lawfully when authorising the issuing of the Proclamation.
[44] It was also submitted that the call for a broader interpretation when construing
the powers of the President in terms section 2 of the SIU Act had no merit. Neither the
President in authorising an investigation into maladministration or the SIU in
conducting the investigation so authorised would be constrained by a narrow
interpretation. It was contended that the president was required to satisfy the
jurisdictional requirements set out in sections 2(1) and the categories 2(2) (a) to (f)
because these were dealing with state institutions, state assets and public money and
the last category 2(2)(g) which was the catch-all category empowered the SIU to
investigate any person, including Telkom, for unlawful or improper conduct which may
cause serious harm to the interests of the public.
[45] The long title of the SIU Act identified the SIU’s primary purpose and functions
which is to investigate maladministration and that the emphasis is on ‘State
institutions; ‘State assets’ and ‘public money’ and any conduct that seriously harms
the ‘interests of the public’.15 Corruption and maladministration were inconsistent with
the rule of law and fundamental values of the Constitution which cannot be left
unchecked. Telkom contended that the SIU’s wide investigative powers16 must be
confined to the SIU Act, that is, ‘kept in bounds,17 and the President is obliged to strictly
comply with the provisions of the SIU Act.
[46] Telkom relying on 2 judgements of the Constitutional Court18 and SCA19
contended that a narrow interpretation be given to the public power conferred on the
President by section 2(1) as, he is required to satisfy himself that the allegations
against Telkom are such that it was rational and necessary to investigate them. It was
submitted for the President that in as far as the interpretation of ‘necessary’ was
concerned reliance by Telkom on ‘Heath’20, ‘Afribusiness’, and ‘British Tobacco’ was
misplaced because they were distinguishable. It was the interpretation of the full
phrase which had an express subjective connotation “whenever [the President] deems
it necessary” that had to be given meaning to.
[47] Furthermore, it was contended for the President that Heath postulated for a
narrow interpretation only in respect of section 2(2) of the SIU Act and that in
Afribusiness and British Tobacco, the power by the decision maker had to be exercised
‘where necessary’21. It was contended further the SIU Act gave the President ‘very
wide power’ as expressed in Municipal Employees Pension Fund V Natal Joint
Municipal Pension Fund (Superannuation)22 which was not overturned by the court in
Afribusiness. It was contended that the exercise of the power of the President to issue
the Proclamation was inferred from the SIU Act and was to advance the purpose for
which the Act was promulgated. It is submitted that this power should not be conflated
with the power given to the SIU, which had the potential to directly interfere with the
right to privacy; the powers of the President were said to be a step ahead and removed
from the investigative process.
[48] As I see it, in addition to the ordinary dictionary meaning of the words “the
President may, whenever necessary” (necessary), is first to consider how the issue
of the Proclamation was authorised. This is done in order to determine whether on the
facts of this application a narrow or wider interpretation should be given to the words
‘when necessary’. The simple reason being that we must look beyond, to the broader
purpose for which the SIU Act was promulgated and to give meaning to the powers
extended to the President by section 2 of the said Act. However, in my view, the
President in the exercise of his powers under the SIU Act is still obliged to observe
the entrenched rights of persons in the Constitution and that it is possible that in
exercising the powers so conferred there was potential of Constitutional rights being
invaded, which he had to guard against.
[49] Heath had to deal with the interpretation of section 2(2) when sections 2(2)(c)
and 2(2)(g)23 were being considered, and where there was a potential of privacy being
invaded, thereby impacting on the entrenched Constitutional rights of the individuals
who were being investigated. The narrow interpretation was construed and adopted,
having regard to the facts of that case.
[50] Afribusiness and British Tobacco are in themselves distinguishable as to the
meaning of the words ‘where necessary’. In Afribusiness the court had to deal with
section 5 of the Preferential Procurement Policy Framework Act 5/2000 (PPPFA)and
the promulgation of the 2017 regulations by the Minister, whether the regulations were
‘necessary to achieve the objectives of the Act’. It was superfluous or not necessary
for the Minister to have promulgated regulations where provision was made in section
2(1) of the PPPFA. The Minister’s regulations were ultra vires. The meaning given to
‘necessary’ by Madlanga J was ‘essential, needed to be done, must be done,
unavoidable’; not only did he interpret the ordinary meaning of the word but he applied
it in relation to the purpose of the Act. In British Tobacco the power given was very
wide and the word necessary, had to be given a narrow meaning, ‘strictly’ interpreted
for various reasons. There the Minister had to discharge the onus of proving by means
of objective scientific facts, not on subjective beliefs, why it was necessary/justified to
infringe the publics’ fundamental rights by the continued ban on the sale of tobacco
products. There was no scientific data made available to show that ‘the quitting of
smoking will reduce diseases severity in relation to COVID 19’.
[51] It is contended for the SIU that it was not calling for an interpretation of the Act
or a broader interpretation of ‘where necessary’, that the authorities relied upon by
Telkom for a narrow interpretation were misplaced. Furthermore, that Telkom’s
instance on a narrow interpretation was nothing more than an attempt to prevent an
investigation into serious allegations of malfeasance24 which neither the President or
the SIU knew about and the seriousness of malfeasance which impacted on the rights
of the public, which had to be verified first by an investigation.
[52] In my view, whether there should be the narrow or wider meaning given to the
exercise of the power by President to authorise a Proclamation to investigate should
be tested against the applicable law, that is, the purpose for which the Act was
promulgated, and also in this instance, the fulfilment of the jurisdictional requirements
before the issue of a Proclamation to investigate by the SIU is authorised. The
jurisdictional requirements are there to be complied with and not overlooked when
dealing with the wide investigative powers of the SIU.
[53] It was contended for Telkom that the President was informed that the
complaints had previously been investigated by a number of institutions. What was
found to be lacking from the record was information which reflected that despite such
past investigations, the issue of the Proclamation had satisfied the jurisdictional
requirements in section 2 of the SIU Act. As far as the issue of the Proclamation was
necessary it had to be ‘essential’, or must be done or ‘needed to be done’ or was
‘unavoidable’ and, in view of the invasive nature of the powers given to the SIU
‘necessary’ had to be narrowly interpreted. In my view rather than wait for the
entrenched rights to be invaded first, it is better to prevent such possibility by giving
protection which can only be exercised by a narrow interpretation.
Ex Post Facto Rationalisations
[54] In addressing the President’s answering affidavit, where reasons25 were given
after the decision was taken to issue a Proclamation and authorise investigation by
the SIU, Telkom contended that such reasons were an afterthought as they did not
reflect in the Rule 53 record, and should not be allowed ‘to render a decision rational,
reasonable and lawful’.26The record of the decision was said to provide a backdrop
against ex post facto justifications.27
[55] It was contended for the President’s that reasons were expressly set out in the
Proclamation. The President was entitled to rely on the opinion of senior counsel on a
complex legal question and the matter of Chang relied upon by Telkom was
distinguishable. There the Minister went against the first decision made on advice of his legal advisors that Chang was immune to prosecution in Mozambique. Later going
against the advice the Minister ordered Chang’s extradition relying of post hoc reasons
which were not apparent from the record. It was contended that in this case the
President continued to rely on the opinion he was given and the question was whether
there were allegations on one or more grounds in section 2(2) and whether he deemed
it necessary to refer the allegations for an investigation. The President did not change
his mind except that in the answering affidavit he elucidated his reasons which was
permitted as indicated in the authority relied upon also dealt with in Chang.28 As I see
it and, as stated in Chang, it is not a wholesale permission to elucidate, what is stated
is that “the court in appropriate cases should admit evidence to elucidate or
exceptionally correct or add to the reasons” but courts were warned to be cautious
when allowing it.29 This has continued to be the view of our courts “that reasons
formulated after the decision has been made cannot be relied upon to render a
decision rational, reasonable and lawful.30”
[56] It was contended that the President authorised the issue of the Proclamation
on the advise of the SIU and the Minister, which he agreed with that Telkom was a
State Institution, thereby limiting the investigation as stated in the terms of reference
to sub-sections 2(2)(a) to (f). Furthermore, the President relied on Senior Counsels
opinion that Telkom may be investigated under subsection 2(2)(g).
Is Telkom a State Institution in terms of subsections 2(2)(a) to (f)
[57] The issue of whether Telkom is a ‘State Institution’, having regard to the
submissions of the parties herein, is a complex one, especially when it has to be
considered in relation to this application, which primarily has to deal with the
application of the PFMA to Telkom’s contracting and procurement processes and, the
application of the SIU Act and to the investigation by the SIU as authorised by the
President in the Proclamation. Telkom’s contention is that it is run as a private
commercial company and as a JSE listed company where the government plays no
role.
[58] The SIU Act defines a ‘state institution’ as an institution in which the ‘State is
a majority or controlling shareholder or in which the State has a material interest in
any public entity as defined in section 1 of the Reporting by Public Entities Act 93 of
1992 Act (RPEA). The RPEA was wholly repealed by section 94 as stated in Schedule
6 of the PFMA, which came into operation on 1 April 2000. Whether the state was not
a state institution and or a public entity having a material interest as defined in the SIU
Act when the Proclamation was applied for or issued must be determined in this
application. The President contended that the Proclamation covered a period when
the state was the majority and controlling shareholder 2006 to 2011.
[59] Telkom is listed in Schedule 2 of the PFMA as a major public entity to which the
PFMA was applicable in terms of section 3(1)(b). A public entity is defined as a national
public entity which meant (i) a national business enterprise; or (ii) a board,
commission, company, corporation, fund or any other entity which is established in
terms (a) of national legislation, (b) which is fully or substantially funded either from
the national revenue, or by way of a tax, levy or other money imposed in terms of
national legislation (c) accountable to parliament.
[60] Telkom argued that the State was not a state institution as defined in the SIU
Act when opinions were sought regarding its status, when the President was advised
and according to reasons advanced in the SIU’s motivation that it was a state
institution, and when the Proclamation was published on 25 January 2022. While
Telkom was established by national legislation, the state did not have a material
financial interest in Telkom and Telkom it did not report to Parliament. Therefore, in as
far as Telkom was concerned it did not meet the requirements of a national public
entity as defined in the PFMA.
[61] The President did not deny that Telkom was not a state institution, having regard
to the components of a state institution as alluded to by the SIU in the definition in the
SIU Act and, the President conceded that Telkom was not a public entity in terms of
the PFMA. However, it is submitted for the President that it is in his power in terms of
the Act to refer for investigation serious maladministration or malpractices of a state
institution for investigation under the SIU Act and that Telkom was a state institution
from 2006 to May 2011.
[62] It is argued for the SIU that in terms of the SIU Act there were four ways in
which the state could be a state institution. The word ‘or’ in the definition which also
was provided for where the State held a material financial interest, or any public entity
in terms of the RPEA had to be read ‘disjunctively31’, since “or” is a classically a
disjunctive word”. Furthermore, that the fourth category contained something different
from a majority or controlling shareholding on the one hand or a public entity as defined
under the RPEA. The empowering provisions in terms of section 2(2) authorised an
investigation of an institution in which the State had a material financial interest. It was
submitted that reverting to the RPEA for meaning of ‘material financial interest’, as
Telkom argued was incorrect. Telkom submits that the definition of ‘material financial
interest’ in the RPEA before it was repealed was instructive.32
[63] In my view, the SIU Act only defines what a ‘state institution is’ but it does not
go further to define the other component parts alluded to on behalf of the SIU. It is
correct that the phrase “material financial interest” in section 1 of the SIU Act has not
been defined or considered by the courts. It is contended for the President that the
principles of interpretation demand that a wide definition be given to ‘state institution’
together with the ‘overarching context in the purpose of the SIU Act which dictates
which entities would be subject to investigation being institutions ‘in which the State
has a material financial interest’. It is submitted for the SIU that ‘material’ would
equate to “appreciable, important and of some consequence’, when the court had to
consider meaning of “material damage” when used in the Rents Act.33
[64] While it is correct to consider the ordinary grammatical meaning of the word
“material” it would not be correct to ignore and look for meaning of the word only
outside the context of the interests of the shareholders in a limited listed company.
Since the state is an ordinary shareholder in a private commercial company listed on
the JSE, the State’s ‘material financial interest’ should be considered in that context
and one cannot ignore the fact that government does not expend funds in any form to
Telkom and does not control it. The RPEA though repealed would indeed be instructive
in attaching meaning to the words
[65] It is argued for the Director General that the 40.5% Government shares in
Telkom and the 15,3% of Government Shares in the GEPF must be lumped together
and that these combined give the Government a 55,81% shareholding in Telkom and
for that reason, Telkom is an organ of state or state institution. The Director General
persists with the view that the PIC was an agency acting on behalf of the GEPF.
[66] The Government having diluted hold on its majority controlling shareholding in
Telkom in 2011, Telkom is still listed as a major public entity in the PFMA, with
Government now holding only 40,5% in ordinary shares. Government is not a majority
or controlling shareholder in Telkom. The words majority and controlling are not
synonymous and the meaning below should prevail.34 In my view Government
remained a major/substantial ordinary shareholder which was still obliged to compete
with other shareholders in as far as the business of Telkom was concerned and on the
JSE. The PIC, although state owned is basically a fund manager and is included in the
count of ordinary shareholders in Telkom as an institutional shareholder and not the
GEPF. For example, the position of government as an ordinary shareholder puts it on
equal standing with other ordinary shareholders when exercising the right to vote, for
example, voting on the appointment of directors / members of the board at a general
shareholders meeting.
[67] The government retains its share of voting rights as an ordinary shareholder
independently of the PIC and the latter exercises its own independence when
exercising its rights as an ordinary shareholder. Government owns a big chunk of
ordinary shares in Telkom but it does not occupy or exercise a position as a majority
55.81% ordinary shareholder in Telkom on the JSE. It is my view that the Director
General’s view is misplaced on the position of the GEPF. It disregards the role of the
PIC (the fund manager for GEPF) as holder of ordinary shares in Telkom, when
considering what it means to be a state institution in terms of the SIU Act when the
Proclamation was sought and issued.
[68] The Minister of Finance as a result of the nature of business of Telkom in
Telecommunications, has from time to time granted to Telkom, its subsidiaries and
entities under its ownership and control exemptions from the provisions of the PFMA
from the years 2001, the most recent exemption published in Government Gazette
No.824 of 11 July 2016, the period as stated in the gazette being of importance35; in
my view these exemptions cannot be ignored as they impact upon the contractual and
procurement processes engaged by Telkom and, they do play a significant role in
determining the identification and status of Telkom as at the time the Proclamation was
issued. Having considered the submissions of counsels on this subject, in my view, all
that the above illustrates is that Telkom was not a state institution as defined by the
SIU Act.
Sub-section 2(2)(g)
[69] Telkom contended that the President had not satisfied the jurisdictional
requirements in the above subsection and, that it was therefore required and relying
on Heath that 2(2)(g) be delineated (i) who is the person (ii) what the conduct is (iii)
what the serious harm was and (iv) the harm must be to the interest of the public or a
particular category of the public.36
[70] The allegations must show how each of the jurisdictional requirements in
2(2)(g) are implicated and this would avoid the ‘impermissible sanctioning of fishing
expedition by the SIU into the affairs of any person who is not the state. The record
specifically indicated that Telkom is to be investigated as a state institution, it is said
lacked specificity and this questioned whether the President applied his mind to what
was before him before determining that the investigation by the SIU was necessary.
The President relied solely on Senior Counsels opinion that Telkom could be
investigated under 2(2)(g). While reliance on legal advice is allowed this did not
absolve that President to test of his own accord whether the jurisdictional requirements
had been fulfilled.
[71] These requirements are specific and evidence must be produced in the
complaint which would have been a ground for authorising the investigation. There is
a complaint that Dr Scott was not satisfied with previous outcomes and that he had
fresh complaints and a witness. The record is not specific about the alleged unlawful
or improper conduct by identifying the person was, what is the conduct and what is the
serious harm caused to the public. Telkom has given Baine which was appointed in
2013 as an example, and was not subject to compliance in terms of the PFMA as the
exemption was applicable, and the instruction to investigate all advisory services
provided to Telkom over a period of 15 years or more.
Decision to issue Proclamation is Irrational / The Proclamation was Vague and
Overboard
[72] Telkom contended that the President took the allegations against it at face value
without questioning the veracity thereof. It was not correct to suggest that it was
Telkom’s view that the allegations against it be proved first before the allegations are
investigated. What was required was for the President to have sufficient facts to justify
a referral to an investigation. A report to the President by the Minister and SIU that Dr
Scott was not happy with previous processes which had been concluded cannot in my
view be good reason for conducting another investigation.
[73] Telkom also contended that a key part of its commercial business over the past
16 years has “been its broadband and mobile strategy for which it has engaged
advisors and that was where most of the work was done. What was missing from the
authorisation is the identity of who was to be investigated, did this include an
investigation into every advisory service over the past 16 years or not. The
Proclamation does not identify which on the many contracts. It was apparent from the
record that the SIU wanted Bain’s contract to be investigated. It was contended that
an investigation over 16 years overall was overboard. It was also contended that item
3 of the schedule widened the ambit of the schedule. Item 1(b) permitted investigation
into unlawful or improper conduct of employees, officials of Telkom or ‘any other
person or entity’ in relation to the matter set out in the schedule
[74] It is contended for the President that in exercising his discretion to refer
allegations for investigation he exercises a wide discretion. The investigation is
authorised on the basis that there was scant information to base civil proceedings. The
fact that there was insufficient information for a decision, the President need not need
to be satisfied that the allegations are ‘established, true or even sufficient to find the
institution guilty if their truth was established”. He need only satisfy himself that the
allegations fall within the ambit of section 2(2) and that there is room for correction in
his power to set aside and amend the terms of reference in terms of section 2(4).
[75] It was contended for the President that there was nothing arbitrary or irrational
about the allegation to be investigated. It was conceded that the period was long but
that included the earliest allegation until the date of Proclamation and this constituted
a rational reason for choosing that period. The allegations to be investigated were not
arbitrary of irrational because they were made by Dr Scott and a second source.
[76] A few examples were given by Telkom for the irrational decision:
(1) the allegation that Telkom sold iWayAfrica, Africa , African Online, Mauritus and
MultiLinks Communication, a business worth R14 billion for $1. What was
ignored was information in Telkom’s integrated annual report (also available to
the SIU) for the year ended 31 March 2012 which included information that
there was a R895 Million relating to the disposal of MultiLinks and that the sale
was necessary to avoid further operating losses of R269 millions. That this
allegation was repeated in the memoranda before the President without any
underlying evidence before him should have raised eyebrows. Telkom contends
that the complaint by Dr Scott was poorly substantiated.
(2) The allegation on the advisory services was sparsely motivated, a little more
than four lines. Telkom awarded a R91 million contract to Bain without tender
which was not denied by Telkom. Telkom stated that Bain was appointed in
2013 during a period when it was not required to contract for services in the
manner that the State was required to as a result of the exemption.
[77] My view is that a report to the President by the Minister and SIU that Dr Scott
was not happy with previous processes some of which had been concluded and further
that there was a second source both having fresh information not disclosed should be
considered with caution. The President is afforded by the SIU Act as head of
government the onerous task to exercise power conferred by the Act to authorise an
investigation by a specialised unit. He does so having evaluated what is before him
and only when he deems it necessary does he authorise an investigation. It might be
necessary, also having applied his mind, independent of the advice that he received
to evaluate whether it is necessary to involve Telkom, not in a full- scale enquiry, but
sufficient to assist him to conclude that an investigation must be authorised. No two
cases are the same and to even suggest that it is not necessary for him to establish
preliminary that certain facts exist, is not correct and this is not what Telkom
contended.
Is the Proclamation invalid on account of the President’s Abdication of Power?
[78] It is preferable to begin with what is submitted for the President, that it is stated
under oath that he applied his mind to the decision based on the information before
him and did not merely rely on the recommendation of the Minister and the SIU.
Furthermore, that (i) it is the functionary, the President in this case who must exercise
the power vested in him;(ii) if he wishes to rely on advice he must at least be aware of
the grounds on which such advice is given; (iii) the functionary does not necessarily
need to read every word of every application and may rely on assistance of others; (iv)
the functionary may not rubber stamp without knowing the grounds on which that
advice was given; (v) whether there was an abdication of the discretionary power is to
be decided on the facts.37
[79] Telkom contends that it may seem on the surface that the President had
complied with the Act, however, the facts have to be interrogated and this can only be
achieved by interrogating the Rule 53 record. The President under (v) above seems
to agree that the allegation of an abdication has to be decided on the facts and that if
the President “relies on the advice of another when exercising his discretion, he must
at least know on what grounds such person holds those views so that he can judge
for himself the soundness of the views.38” It is not in all cases where it is required that
the president asks questions, make enquiries and not investigate as is suggested is
the demand of Telkom which it is not. This is special and more complex. The fact that
there were prior investigations and an application which had been declined called for
reasons why these were of no consequence to the President, especially when it is
alleged that there are fresh and more serious allegations against Telkom which have
not been disclosed in the record.
[80] Telkom contends that the allegations relied upon in the Minister’s letter to the
President were annexed as “A”. These allegations were not annexed instead, to the
SIU’s updated memorandum which is part of the record is annexed an annexure “A”
which is a list of the directors of the companies to be investigated. It is common cause
that there were earlier complaints by Dr Scott which were presented to President Zuma
who declined to authorise the issue of a proclamation to investigate Telkom and that
the SIU was part of a presentation to the then President. It should be accepted in my
view that this complaint was laid to rest and could not be resuscitated.
[81] The Minister and the SIU tell the President that Dr Scott was not satisfied with
how previous matters were handled, that Dr Scott had come up with fresh allegations
and a witness who was willing to cooperate with the SIU. A request for the allegations
to the President revealed reliance on a 2014 complaint by Dr Scott. This was bound
to be confusing as what the President explains in the answering affidavit is that there
was a complaint which was submitted to the Presidency and referred to the SIU.
Telkom submitted that it called for further information on the alleged complaint because
no other details were provided.
[82] The President was informed that a previous request for a Proclamation was
declined, he was told of the presence of fresh allegations. In my view Dr Scot was
within his right to say he had come up with fresh evidence since the last time he was
before the erstwhile President and there was a witness who was prepared to
cooperate with the SIU. The least the President could have done was to ascertain that
what he was presented with related fresh allegations even if the fresh allegations shed
a new light on what prevailed before, the existence a fresh perspective which called
for a fresh investigation. The Proclamation having been published it does not seem to
me that the President or Telkom had knowledge of Dr Scott’s fresh complaints, sourced
within or after 2015 to date of the Proclamation; yet, the President relied solely on the
advice of the Minister and SIU. In my view, he was allowed to do so provided, the
advice was based good grounds and that the SIU and Dr Scott were transparent about
the nature of the fresh allegations.
[83] Was the President expected to interrogate the advice from the Minister and SIU,
especially in terms of the SIU Act? I would say it depended on the facts. In this case,
yes, because the facts demanded that he appraise himself properly and the
reasonable conclusion I arrive at is that he did not. In the SIU’s own narrative as to
what transpired after Dr Scott’s direct approach to the SIU, it seems, as correctly
pointed out on behalf of Telkom, that the SIU embarked on an investigation prior to it
being authorised to do so, where it says, it went through ‘reams and reams of
documents, Dr Scott’s complaint and the two arch lever files, it interviewed a
prospective witness, evaluated the complaint of Dr Scott and selected which of Dr
Scott’s various complaints deserved to be investigated by the SIU via a request to the
President to issue a Proclamation. There is no indication of why or what complaints
were left out, and the reasons for selecting those that remained. What appears is a
memorandum of Dr Scott’s complaint to the President authored and edited by the SIU.
[84] As I see it, an evaluation of the complaint entailed the SIU taking upon itself to
direct the course of the investigation even before the President was involved and as
already indicated, its narrative prior the Proclamation cannot be overlooked. It is
contended for the President that the SIU was entitled to do the pre-ground work that
is why it was able to direct the content of the Minister’s letter to the President and as
is evident from the schedule which is part of the record on the way forward. The
updated memorandum says as much. Dr Scott’s complaint it seems to me was
stripped of what was not important or /relevant to be investigated in the eyes of the
SIU and it is the result that was forwarded to the President.
[85] The SIU Act provides when the President is empowered to authorise an
investigation by the SIU, when he deems it necessary and when the jurisdictional
requirements in subsections 2(2)(a) –(g) have been satisfied. Most important is that
the SIU functions within the parameters of the framework of its terms of reference as
as provided in section 2(3) and 4(1) of the SIU Act. The Proclamation having been
issued still obliges the SIU to report back to the President on that has transpired and
what needs to be done with the information collected.
[86] In my view the issue around the 2015 refusal and the fact that there are other
fresh complaints known to the SIU which the President and Telkom have not been
appraised of should have been questioned by the President by calling for better
information and not to allow the course of investigation to be dictated by the SIU as to
what should happen even going as far as suggesting the times frames for the
investigation which the President accepted without question. This in my view could
amount to an abdication of Power, leaving everything in the hands of the SIU without
question.
Is PAJA Applicable to the President’s Decision / Is the President’s Decision
Procedurally Irrational
[87] Telkom asserts that the exercise of public power is subject to judicial review,
the forms of which may differ according to the facts39 and that in this instance the
decision of the President was administrative action in terms of PAJA as defined in
section 1 thereof40, in that it involved a decision by the President exercising public
power or performing a public function as defined in legislation, the SIU Act;41 It was
contended that there was no merit in a suggestion by the SIU that the President was
performing an executive function as envisaged in section 85(e) of the Constitution.
[88] It was also contended that even if PAJA was not applicable this did not close
the door to Telkom requesting that procedural rationality prevail and be imposed on
the President.42
[89] Although Albutt addressed the right of the victims of crime to be heard, the
purpose being to achieve the goal of reconciliation, the President’s decision to exclude
them from the process of pardon did not accord with the spirit of reconciliation as
propounded before the TRC. The pardon in this case was in a different category than
other applications for pardon and the High Court’s finding that the process of pardon
was administrative action, was found to have erred by not differentiating between the
category of pardons in determining that the right to be heard in that instance was based
on PAJA. The court also examined the difficulties it would face if it were to consider
whether PAJA was relevant and includes within ‘its ambit the power to grant pardon. A
different conclusion was arrived in the Law Society matter as quoted in the footnote
below.
[90] It was contended for the President Telkom that his decision fell outside of PAJA
in that it did not affect the rights of any person or had a direct of external legal effect.
Telkom had made a concession that it may be right or wrong on the PAJA aspect. The
President’s decision was simply for the SIU to investigate and nothing more and this
did not include a right to be heard. The claim that Telkom’s shares had dropped and
that it had lost millions when the decision of the President to investigate Telkom by the
SIU was announced to the world, was a hollow one since it concerned merely an
interest of Telkom and not a legal right and no evidence had been adduced by Telkom
to support its contention.43
[99] In my view the issues to be determined under this heading are competing and
complex. Telkom contends that this is an extraordinary matter where special
circumstances prevail which cannot be ignored. Telkom says it is not averse to
complying with the law and that it has so far done so, however, while agreeing to be
cooperative in the investigation it maintained its right to voice its grievance by being
denied a right to be heard. I am of the view that given the circumstances of this case
the President had an obligation to hear out parties who might be and in fact have been
impacted by his decision.
[100] For the President is contended that this court is bound by well stablished
principles of stare decisis, Telkom deserves no special treatment, it has no right to be
heard, its rights have not been affected and if they have, it has a chance of
recourse within the process of investigation. This view is shared by the SIU. The
parties are in agreement that the application of the law is also determined by the facts
before the court and by the Constitution. In my view the select on which issues were
to be investigated was that of the President and not the SIU as happened.
[101] I have considered all the facts. The purpose to the SIU Act is to assist root out
the scourge our country faces as a result of corruption and maladministration which
must be rooted out and our courts have consistently ruled in that regard. This is not a
simple matter and I take into consideration that Telkom states that it is not shying away
from the investigation and wishes to comply with the law, albeit that it has a right to
protection of its rights and to a fair procedure. I have considered the contention that
Telkom had undertaken to cooperate with the investigation in a meeting however, there
is no record of the meeting nor a confirmation or agreement as to what actually was
agreed upon. I am weary to accept that the letter from its attorneys constituted a
binding agreement after all its states that Telkom’s rights are reserved.
[102] I have made several findings, that Telkom is not a State institution; that Telkom
under 2(2)(g) of the SIU Act is not excused from being investigated provided that the
jurisdictional requirements are satisfied; that there was lack of transparency to the
President and to Telkom of what fresh evidence of Dr Scott and the second
informant was, which was shared with the SIU and which prompted the request; that
the reason for the Proclamation in the President’s answering affidavit constituted ex
post facto rationalisations; that the decision was irrational and overboard and that on
the facts there was an abdication of power conferred by the SIU Act. The SIU by
launching and investigation before it was authorised to do so by Proclamation placed
the President in a precarious position in that it presented a report which was fully
adopted by the Minister and the President without the slightest query or comment. On
these facts I find that Telkom should at least have been brought on board in writing by
the President notifying Telkom of the enormity of the allegations, that he was
considering issuing a Proclamation and inviting input before publication. This was the
most rational manner the President could have adopted and our courts should hold all
those exercising legislative power to this standard. The President’s Proclamation was
unconstitutional, irrational, invalid and of no force or effect. The Proclamation is
therefore set aside.
Remedy
[103] I have regard to Telkom’s and the SIU’s contentions in this regard. Telkom in
terms of an agreement requires that all documents retrieved from them to be returned in terms of an agreement pertaining to Part A. The SIU contends that I am not bound by the agreement and that I could exercise a discretion to allow it to keep the documents, this is motivated by the hours and months spent during its investigation at huge cost to the SIU. There is an understanding by Telkom that the setting aside of the Proclamation does not preclude the President from authorising another investigation. I think an appropriate order would be for the parties to make arrangements to complete an inventory of the documents seal them for 6 months and return same to Telkom. I am also aware that Telkom might in the future need the documents and I leave it to the parties to arrange when these documents can be unsealed.
[104] In the result the following order is granted:
(1) It is declared that Proclamation 49 of 2022 issued by the first respondent
under Government Gazette No. 45809 on 25 January 2022 in declared
unconstitutional, invalid and of no force or effect;
(2) The Proclamation is set aside;
(3) It is declared that the investigation by the second respondent in terms of
the Proclamation is invalid and of no force or effect;
(4) The investigation by the second respondent is set aside;
(5) The documents retrieved from the applicant by the second respondent are
to be returned subject to them being sealed for six months;
(6) The respondents are ordered to pay the costs of the applicant the which
include costs of two counsel.
_____________________
TLHAPI J
JUDGE OF THE HIGH COURT
GAUTENG DIVISION, PRETORIA
HEARD AND RESERVED ON: 24 NOVEMBER 2022
DELIEVERED ON 19 JULY 2023
Appearances:
For the Applicant: Adv N H Maenetje SC with Adv T N Nqucukaitobi SC, Adv L Zikalala and Adv P Sokhela (instructed by) Edward Nathan Sonnenbergs INC
For the First Respondent: Adv D Joubert SC with P Ngcongo (instructed by) The State Attorney Pretoria
For the Second Respondent: Adv M du Plessis SC with Adv K Hofmeyr SC, Adv J Thobela-Mkhulisi and Adv T Palmer (instructed by) The State Attorney Pretoria
For the Third Respondent: Adv Adv R Ramawele SC with Adv K Magano (instructed by) The State Attorney Pretoria
1“To provide for the establishment of Special Investigating Units for the purpose of investigating serious malpractices or maladministration in connection with the administration of State institutions, State Assets and public money as well as any conduct which may seriously harm the interests of the public, and for the establishment of Special Tribunals so as to adjudicate upon civil matters emanating from investigations by Special Investigating Units; and to provide for matters incidental thereto.”
2 The Proclamation states: “WHEREAS allegations as contemplated in section 2(2) of the SIU have been made in respect of Telkom”
3 “1. The contracting of or procurement of –
(a)Telegraphic services (telex and telegram); and
(b) Advisory services in respect of the broadband and mobile strategy of Telkom, by or on behalf of Telkom, and payments made in respect thereof in a manner that was-
(i)not fair, equitable, transparent, competitive or cost effective; or
(ii)contrary to applicable-
(aa)legislation;
(bb)manuals, guidelines, circulars, practice notes or other instructions issued by the National Treasury; or
(cc)manuals, polies, procedures, prescripts, instructions or practices of or applicable to Telkom,
And any related unauthorised, irregular or fruitless and wasteful expenditure incurred by Telkom or the State.
2.Malaadministration in the affairs of Telkom in relation to the sale or disposal of-
(a)iWayAfrica and Africa Online Mauritius; and
(b)Multi-Links Telecommunications Limited;
And any losses or prejudice suffered by Telkom or the State as a result of such maladministration.
3. Any unlawful, improper or irregular conduct by-
(a)employees, officials or agents of Telkom; or
(b)any other person or entity,
In relation to the allegations referred to paragraphs 1 and 2 to the schedule.”
4 “State institution means any national or provincial department, any local government. Any institution in which the State is a majority or controlling shareholder or in which the State has a material financial interest, or any public entity in section 1 of the Reporting by Public Entities Act 3 of 1992”
5 “national public entity means:-
(a)A national government business enterprise; or
(b) Board, commission, company, corporation, fund or other entity (other than national government business enterprise) which is –
(i) established in terms of national legislation;
(ii) fully funded either from the National Revenue Fund or by way of a tax, levy or other money imposed in terms of national legislation; and
(iii) accountable to Parliament
6 section 6(2)(f)(i);
7PAJA section 6(2)(d)
8 PAJA section 6(2)(e)(i)
9 PAJA section 6(2)(f) (ii) (aa)and (bb)
10 PAJA section (2)(c)
11 Telkom SA SOC Ltd v City of Cape Town and Another 2020(1) SA 514 (SCA); MultiLinks Telecommunications Ltd v Africa Prepaid Services Ngeria Ltd; Telkom SA SOC Limited and another v Blue Label Telecoms Limited and Others [2013] 4 All SA 346 (GNP)
1253.1 Improper procurement of telegraph service from Network Telex:
“53.1.1 Telkom’s Review Council approved a tender for the outsourcing of telegraphic services in November 2007.
53.1.2 The tender was worth R120 million per year for 13 years.
53.1.3 Bids received from Phuthuma and Network Telex.
53.1.4 Telkom subsequently cancelled the bid.
53.1.5 Notwithstanding the cancellation, Network Telex was rendering the services to Telkom, without having
been awarded through a proper tender.
53.1.6 If these allegations are correct, Telkom would have irregularly paid millions of rand to Network Telex.
53.2Allegation that Telkom acted improperly in procuring advisory services:
53.2.1 Telkom appointed Bain & Co to advise Telkom on its broadband and mobile strategy.
53.2.2 There was no published tender in respect of the process of Bain’s appointment.
53.2.3 The contract was for R91 million.
53.2.4 The appointment needs to be investigated to ascertain whether it was in accordance with section 217
(1) 0f the Constitution.
53.3 Allegation of maladministration in relation to the various sales:
53.3.1 Telkom sold iWayAfrica and Africa Online Mauritius to Gondwana International Networks for $.
53.3.2 Telkom squandered R14 billion with the purchase and subsequently sale of Multi-Links.
53.3.3 There is no indication or explanation of how the mechanism used to dispose of these assets was
Determined, or whether it was fair, cost-effective or transparent.
53.3.4 Telkom appointed a person(the second source) as a chartered accountant and instructed him to
Liquidate iWayAfrika and Multi-Links.
53.3.5 The source was unable to liquidate these entities as there was no bais for liquidation.
53.3.5 The source was then instructed by Telkom to find an immediate purchaser.
53.3.7 A purchase agreement was subsequently concluded for $1.
13 Special Investigating Unit v Nasden [2002] 2 ALL SA 170(A) at para 5:”A unit such as the appellant is similar to a commission of enquiry. It is well to be reminded, in the words of Corbett JA in S v Naude ….. of the invasive nature of commissions, how they can easily make inroads upon basic rights of individuals and that it is important that an exercise of powers by non-judicial tribunal should be strictly in accordance with statutory or other authority whereby they are created….this accords with the Constitutional Court in ………..Heath and others para 52. Appellants reliance upon a liberal construction …..is therefore misplaced
Heath (below) para 52: ……”the broader the reach the greater the invasion of privacy”
14 Heath para 52" " the broader the reach of the Act the greater the invasion of privacy.......The spirit objects and purport of the Bill of Rights, here the protection of privacy will better be met in this case by giving a narrow rather that a broad interpretation of these provisions".
15 South African Association of Personal Injury Lawyers v Heath and Others 2002(1)SA 883(CC) at para 58: “The primary purpose of the Act is to enable the state to recover money that it has lost as a result of unlawful or corrupt action by its employees or other persons. The public money contemplated by the Act, is the money of a state institution that has been paid out or expended and which the state institution is entitled to recover” and para 4: -corruption and maladministration were inconsistent with the rule of law….if allowed to go unchecked and unpunished they will pose a serious threat to our democratic state,
Glenister v The President of the Republic of South Africa and Others 2011 (3) SA 347 (CC) para 57
16 In terms of section 5(2) and (3)-an order to appear before the SIU to be interrogated and to produce specified books, documents or objects in possession of the individual -search and seizure against Telkom, employees and officials - section 12(1) which provides for a punishable offence on failure to obey- possibility of criminal charges being instituted.
17 Masuku v Special Investigating Unit 2021 JDR 0720
18 Minister of Finance v Afribusiness 2022 (4) SA 362 (CC) at para [39]”The ultra vires doctrine, which is a subset of the principle of legality, is central to the determination of lawfulness of the exercise of that power for by the applicable and the Constitution.” ( I have included the following para [112] to understand better para [114] relied upon) [112] I do give meaning to “necessary or expedient. So for me the starting point is whether the impugned regulations meet the requirements of section 5: are they necessary or expedient to achieve the objects of the Procurement Act.” [114]” Logically, that must mean the determination of a preferential procurement policy by a person or entity other than each organ of state is not necessary for the simple reason that there already is section 2(1) for the determination of such policy by each organ of state. Therefore, rather than being necessary any determination of policy by the Minister would be superfluous and not at all within the ambit of what is necessary as envisaged in section 5. According to the Compact Oxford English Dictionary “necessary” means”1. Needing to be done, achieved or present…2, that must be done; unavoidable. If there already is provision in the Procurement Act for each organ of state to determine and implement its preferential procurement policy, how can it be necessary for the Minister to make a provision by regulation for the same thing.”
19 Minister of Cooperative Governance and Traditional Affairs and Another v British Tobacco South Africa (Pty) Ltd and Others 2022 (3) All SA 332 (SCA) [102] “In Minister of Finance v Afribusiness NPC [2022] ZACC ….Madlanga J writing for the majority held that the word necessary in that context means “needing to be done” or “that must be done. [103] Applied to the present case, necessary in s27(3) must be narrowly construed to mean ‘strictly necessary’ or essential to assist and protect the public or to deal with the destructive effects of COVID-19. ( (1, the lawgiver would have stated if the power in 27(3) should be exercised to the extent reasonably necessary. 2,it is a settled rule of interpretation that word in a stature bear the same meaning …3….necessary cannot depend on the mature of the matter in 27(2).4 …. The power of the Minster conferred …by s27(3) cuts across and effectively and temporarily suspends various statues dealing with matters listed in s27 (2)(a)-(m) 5… this construction is reinforced by the purpose of the Act and the fact that the declared national state of disaster is of short duration…)
20 Heath paras [51] and [52] section 2(2) ‘impacts upon entrenched Constitutional rights to the privacy to the affected person….protection to privacy would be met by a narrow rather than a broad interpretation’.
21 My view is that Heath did not only broadly concentrate on section 2(2) it extended the interpretation to the subsections 2(2)(c) and 2(2)(g)
22[2017]ZACC 43; (2018) para [33] “The power given to the MEC under section 4 is indeed very wide. It includes the power to make regulations providing for matters considered necessary or expedient to purposes of the fund.
23 Heath para 55 - 54 and 60-65.
24 Moran v Lloyd’s (A Statutory Body) [1981] Lloyds Reports 423(CA) at 427 “We often find that a man(who fears the worst) turns around and accuses those -who hold the preliminary enquiry of misconduct or unfairness or bias or want of natural justice. He seeks to stop the impending charges against him…To my mind the law should not permit any such tactics. They should be stopped at the outset.”
25 As contended by Telkom from paras 34-44 of the President’s answering affidavit.
26 Forum De Monitoria Do Orcramento v Chang and Others [2-22] 2 ALL SA 157(GJ) para 82
27 Magistrates Commission and Others v Lawrence 2022 (4)107 (SCA) para 97 ; Turnbull Jacksons v Hibiscuse Court Municipality and Others 2014 (6)SA 592 (CC) at para 37
28 R v Westminister City Council ex parte Ermakow [1966]2 All ER 302 (CA) at 315-316 “function of such evidence should generally be elucidation not fundamental alteration, confirmation or contradiction”
29 Also in the above matter at 315-316 as relied upon in Chang para[81] “The court can and in appropriate cases, should admit evidence to elucidate, or exceptionally correct or add to the reasons; but …be very cautious about doing so…Certainly there seems to be no warrant for receiving and relying as validating the decision evidence-as in this case-which indicates that the real reasons were wholly different from the stated reasons. The cases emphasize that the purpose of reasons is to inform the parties why they have won or lost and enable them to assess whether they have ground for challenging sloppy approach by the decision-maker, but this gives rise to practical difficulties.[82] It is clear that the reason cannot be contrived post hoc the decision. Otherwise, this would provide an opportunity to justify a decision after the fact, preventing a court from scrutinising the actual reason behind the decision when it was made.”
30 National Energy Regulator of South Africa v PG (Pty) [2019] ZACC 28: 2020(1) SA 450 (CC).
31 Ngcobo and Others v Salimba CC; Ngcobo v Van Rensburg 199(2) SA 1057 SCA
32 “material financial interest had three component part (a) it is more than just a significant shareholding; (b) requires significant shareholding together with the power to appoint directors; (c) requires that there should be a significant expenditure of government funds towards the entity and control by the government”
33 In Arendse v Badroodien 1971(2) SA 16 (c) -the court considered the ordinary grammatical meaning of the word ‘material- ‘of serious or substantial import; of much consequence, important and appreciable and worthy of consideration’
34 (i)A shareholder who owns more than 50% of the outstanding of a company is referred to as a majority shareholder (outstanding shares refer to all the shares issued by a company and currently held by ordinary shareholders, institutional investors ….(https//sashares.co.za rights and responsibilities of shareholders) (ii) (JSE Listing requirements defines a controlling shareholder as “any shareholder that together with (1) his or its associates; or ( 2_ any other party with whom such shareholder has an agreement or arrangement or understanding, whether formal or informal, relating to any voting rights attaching to securities of the relevant company can exercise or cause to be exercised the specified percentage as defined in the Takeover Regulations or more of the voting rights at general/annual general meetings of the relevant company or can appoint or remove or cause to be appointed or removed directors exercising the specified percentage or more of the voting rights at directors meetings of the relevant company……..”
35 Period of Exemption: “With effect from the date of this notice until:-
(a)the date immediately before the date Telkom SA Soc Limited comes under the
ownership control of the national executive as defined in section 1 of the Act; or
(b) Telkom SA SOC limited is delisted from the Johannesburg Securities Exchange;
36 Heath paras: [52]- a narrow meaning had to be applied to safeguard the rights in the Bill of Rights; [60][61][62]- any person to be investigated must be clear from the Proclamation that he/she/it is the subject of investigation
37 Minister of Environmental Affairs and Tourism and Another v Scenematic Fourteen (Pty)Ltd [2005] ZASCA 11; [2005] 2 All SA 239(SCA) at para 20 with reference to Vries v Du Plessis NO 1967 (4) SA (SWA) 481-F-G
39 Pharmaceutical Manufacturers Association of SA and Others; In Re: Ex Parte Application of President of the RSA and others 2000 (3) BCLR 241 (CC) at para 20: “The exercise of public power must comply with the Constitution which is the supreme law and the doctrine of legality which is part of that law. The question whether the President acted intra vires of ultra vires in brining the Act into force when he did is accordingly a Constitutional matter. A finding that he acted ultra vires is a finding that he acted in a manner that was inconsistent with the Constitution.
40 “… a decision or failure to take a decision that adversely affects the rights of any person which has a direct external legal effect – this included action that has the capacity to affect legal rights – whether or not administrative action which would make PAJA applicable has been taken cannot be determined in the abstract, Regard must always be had to the facts of each case”
41 Minister of Defence and Military Veterans v Motau and others 2014 (8) BCLR 930 (CC)
42 Telkom relied on the following cases: Albutt v Centre for the Study of Violence and Reconciliation and Others 2010 (5) BCLR 391 (CC) at para 47 “This decision is challenged on three main grounds 1. The decision to exclude victims from participating in the special dispensation process is irrational 2, the context-specific features of the special dispensation process requires the president to give victims a hearing and 3, the exercise of the power to grant pardon constitutes administrative action and therefore triggers the duty to hear the people affected; Minister of Home Affairs and Others v Scalabrini Centre, Cape Town (SCA) 735/12 and 360/13; Law Society of South Africa v President of the Republic of South Africa2019(3)BCLR 329 (CC) at para 70 “ In tjis case the Director-General was pertinently aware that the were a number of organization including the Scalabrini Centre with long experience and special expertise in dealing with asylum seekers……..I am left to infer that the Director General’s failure to hear what they might have to say when deciding whether that office was necessary for fulfilling the purpose of the Act was not founded on reason and was arbitrary”
43 Competition Commission v Telkom SA LTD and others [2009] ZASCA 155; [2010]2 All SA 433 at para:10 “ Care must be taken not to conflate two different aspect of the definition of administrative action in PAJA, namely the requirement that the decision be one of an administrative nature and the separate requirement that it must have capacity to affect legal rights; I consider that Telkom has failed to establish both requirements. As to the second of these although the complaint referral indeed affects Telkom in the sense that it may be obliged to give evidence under oath, be subjected to a hearing before the Tribunal and be required to submit its business affairs and documentation to Public scrutiny it cannot be said that its rights have been affected or that the action complained of had that capacity” Viking Pony Africa Pumps (Pty) Ltd t/a Tricom Africa v Hidro Tech Systems (Pty) Ltd and Another (CCT 34/10) [2010] ZACC 21; 2011 (1) SA 327 (CC) para 37 “ PAJA defines administrative action as a decision or failure to take a decision that adversely affects the rights of any person, which has a direct exact l legal effect- this includes “action that has the capacity to affect legal rights- whether or not administrative action which would make PAJA applicable, has been taken cannot be determined in the abstract. Regard must always be had to the facts of each case”; Corpcio 2290 CC t/a U-Care v Registrar of Banks [2013] 1 All SA 127(SCA) para 26
Cited documents 12
Judgment 5
- Competition Commission of South Africa v Telkom SA LTD and Others (623/2009) [2009] ZASCA 155 (27 November 2009)
- Minister of Environmental Affairs and Tourism and Another v Scenematic Fourteen (Pty) Ltd (85/2004) [2005] ZASCA 11 (22 March 2005)
- National Energy Regulator of South Africa and Another v PG Group (Pty) Ltd and Others [2019] ZACC 28 (15 July 2019)
- Pharmaceutical Manufacturers Association of South Africa and Another: In re: Ex Parte: President of the Republic of South Africa and Others [2000] ZACC 1 (25 February 2000)
- Viking Pony Africa Pumps (Pty) Ltd t/a Tricom Africa v Hidro-Tech Systems (Pty) Ltd and Another [2010] ZACC 21 (23 November 2010)