INTERNATIONAL RESOURCES HOLDING RSC LIMITED’S 51PC STAKE IN MOPANI COPPER MINES PLC IS UNCONSTITUTIONAL AND NULLITY
THE acquisition of the 51 percent stake in Mopani from ZCCM Investment Holdings PLC (ZCCM-IH) by IRH Limited is unconstitutional because it operated on an illegal “ZCCM-IH Shareholder Approval” which ought to have been a Condition Precedent for the closing or completion of the Transaction hence making it a nullity.
The SENS ANNOUNCEMENT (the “Notice” or “Announcement”) issued in Lusaka, Zambia on December 22, 2023 which provided for the TRANSACTION ANNOUNCEMENT Regarding Mopani Copper Mines Plc is instructive to the effect that the Condition Precedent for the transact must be met.
ZCCM-IH
1. Industrial Development Corporation (IDC) having 60.28 percent shares
“The IDC was incorporated in January 2014 and is wholly owned by the Government through the Minister of Finance pursuant to the Minister of Finance (Incorporation) Act Cap
349 of the Laws of Zambia.”
2. Government of the Republic of Zambia (GRZ) having 17.25 percent shares
“GRZ is represented by the Minister of Finance by virtue of the Minister of Finance (Incorporation) Act Cap 349 of the Laws of Zambia.”
3. National Pension Scheme Authority (NAPSA) having 15.00 percent shares
“The National Pension Scheme Authority (NAPSA) was established in February 2000 by the National Pension Scheme Act no. 40 of 1996 of the Laws of Zambia.” and
4. Minority Shareholders having 7.47 percent shares
It must be noted that the three major shareholders in ZCCM-IH hold their interests in trust for and on behalf of the Zambian people.
Further to this; The Government of The Republic of Zambia owns property through the Minister of Finance. The Minister of Finance (Incorporation)
Act (CAP 349 of the Laws of Zambia) has provided in Section 3 for Incorporation of Minister of Finance. Viz;
“3. The Minister of Finance shall be a corporation sole by that name, with perpetual succession and an official seal, and with power to acquire and hold in that name lands, Government securities, shares in any company, securities for money, and real and personal property of every description, to sue and be sued, to execute deeds, to enter into agreements binding on himself and his successors in office, and to do all other acts necessary or expedient to be done in respect of the above matters or any of them.”
Furthermore, this Act has provided in Section 7 that;
“7. All property vested in the Minister of Finance under or by virtue of the provisions of this Act shall, except where and to such extent as the property is held on other trusts, be held in trust for the President on behalf of the Government.
Having established the fact that the three major shareholders in ZCCM-IH hold their interests for and on behalf of the Zambian Government, such interests are State Assets. It is conclusive that the Act is instructive as to whose interest assets held by the Minister represent. (The Zambian People).
Suffice to note that, ARTICLE 210 of The Constitution of
Zambia Amendment Act No. 2 of 2016 has provided for public procurement and disposal of State assets.
ARTICLE 210(2) of The Constitution of Zambia Amendment Act No. 2 of 2016 provides that;
“(2) A major State asset shall be sold, transferred or otherwise disposed of, as prescribed, subject to the approval of the National Assembly signified by a vote of at least two-thirds of the Members of Parliament.”
This provision has further defined a major State asset in Sub Article (3) as;
“(3) For the purposes of this Article, “major State asset” includes
This in itself entails that the Zambian people must be consulted as and when a major asset such as the interests held by ZCCM-IH in a company such as MOPANI is being sold, transferred or otherwise disposed of.
The Constitution is instructive as to the fact that the sale of the 51 percent stake in MOPANI to IRH Limited by ZCCM-IH was supposed to be subject to the approval of the National Assembly by a vote of at least two-thirds of Members of Parliament.
It is for this reason that I am of the opinion that the shareholders did not consult the people in whose interests they represent when coming up with the “ZCCM-IH Shareholder Approval” for the sale of that major asset belonging to the Government of the Republic of Zambia. Therefore, the said approval by the shareholders is illegal and a nullity ab initio.
CONCLUSION
The Attorney General and the Minister of Finance must revisit the transaction immediately and ensure that the government and ZCCM-IH corrects this constitutional abrogation by subjecting the said sale before the National Assembly for approval as it flies in the teeth of a constitutional abrogation by the Republican President. We must protect and defend the constitution of the Republic of Zambia.
PARTICULARS OF THE “ZCCM-IH SHAREHOLDER APPROVAL” ILLEGALITY The Shareholders for are;