• Text size  | | |
• Email this document
• Printable version

Zimbabwe: Outcome of the Shibanie Mashava Mines (SMM) Holdings High Court case and the current status of Charles Chipato, Permanent Secretary to the Minister of Mines

SMM Holdings High Court case

Shibanie Mashava Mines (SMM) Holdings, a mining group based in Zimbabwe (Financial Gazette 16 Sept. 2004; Zimbabwean Independent 6 Oct. 2006), is the country's largest asbestos producer (ibid.). The mining group was part of a "sprawling empire" owned by Mutumwa Mawere, a Zimbabwean businessman based in South Africa (The Herald 5 July 2007; ibid. 31 July 2006; Zimbabwe Independent 18 Feb. 2005). However, in 2004, the Zimbabwean government seized SMM under the country's Reconstruction of State-Indebted Insolvent Companies Act (ibid.; The Herald 11 Jan. 2007). This legislation reportedly allows state officials to take control of the shares and securities of a company for its reconstruction (Zimbabwe Independent 24 Mar. 2006; The Herald 11 Jan. 2007; Financial Gazette 4 Apr. 2007).

According to news reports, the Zimbabwean government claimed that SMM was "heavily exposed" (The Herald 5 July 2007; ibid. 17 Jan. 2007), and that it was taking control of the company to save jobs (Financial Gazette 16 Sept. 2004; Zimbabwe Independent 24 Mar. 2006). Cited in two October 2006 news reports, a government official stated that Mawere was personally liable for SMM's debts and "reconstruction" costs, which amounted to millions of dollars (The Herald 2 Oct. 2006; Zimbabwe Independent 6 Oct. 2006). The government also accused Mawere of "gross negligence" and fraud (ibid.; The Herald 2 Oct. 2006).

Mawere, however, denied the allegations (Zimbabwe Independent 18 Feb. 2005; ibid. 6 Oct. 2006). The businessman claimed that the Zimbabwean government seized his property in order to pay off its debts to the International Monetary Fund (IMF) (Washington Post 24 Feb. 2006; NewZimbabwe.com 17 Nov. 2006). Since 2004, other businesses owned by Mawere, including several companies based outside Zimbabwe, have been seized by Zimbabwe's government (Pretoria News 22 May 2007; see also NewZimbabwe.com 17 Nov. 2006).

In 2006, SMM filed an application to the country's High Court to cancel the "reconstruction" order by the state (The Herald 31 July 2006; Zimbabwe Independent 2 June 2006); however, on 10 January 2007, the High Court dismissed the application (The Herald 11 Jan. 2007; ibid. 17 Jan. 2007). One week later, Mawere submitted an appeal to the country's Supreme Court to challenge the High Court ruling (ibid.). This appeal was dismissed in July 2007 (ibid. 5 July 2007).

In 2007, Mawere sued the South African government for allowing his businesses in South Africa to be confiscated by the Zimbabwean government (Pretoria News 22 May 2007; see also Financial Gazette 4 Apr. 2007). The case is being heard before the Johannesburg high court (Pretoria News 22 May 2007). Information on the outcome of the case could not be found among the sources consulted by the Research Directorate within the time constraints of this Response.

Status of Charles Chipato

Charles Chipato is a former chief executive officer (CEO) of SMM Holdings (Daily Mirror 24 Feb. 2005a; ibid. 24 Feb. 2005b). Reportedly seen as "sympathic" towards Mawere, Chipato was part of the SMM Holdings board of directors that was dismissed by the Zimbabwean government following the company's confiscation in 2004 (Financial Gazette 16 Sept. 2004). However, according to the Harare-based Daily Mirror, Chipato was fired as the CEO of SMM in January 2005 (Daily Mirror 24 Feb. 2005a; ibid. 24 Feb. 2005b). Chipato had reportedly served as CEO of the company since June or July of 2004 (ibid. 24 Feb. 2005a).

Prior to working as the CEO of SMM, Chipato held various positions in both the public and private sectors of Zimbabwe (The Herald 2 Mar. 2006; Financial Gazette 16 Sept. 2004). An engineer by training, Chipato joined the country's civil service in 1983 (The Herald 10 Apr. 2002; Financial Gazette 30 July 2003). He reportedly "rose through the ranks" until he became the Secretary of Mines, Environment and Tourism in 1997 (ibid.; The Herald 10 Apr. 2002).

In April 2000, in his role as Secretary of Mines, Environment and Tourism, Chipato was Zimbabwe's delegate to the Convention on International Trade in Endangered Species (CITES) conference in Kenya (PANA 18 Apr. 2000; ibid. 17 Apr. 2000; ENS 14 Apr. 2000). During the conference, four southern African countries, including Zimbabwe, expressed support for lifting the ban on ivory in order to be able to legally sell the country's stockpiles (ibid.; PANA 17 Apr. 2000). Chipato is cited in several news articles defending Zimbabwe's position on the lifting of the ban (ibid.; ibid. 18 Apr. 2000; ENS 14 Apr. 2000). He reportedly expressed "disgust" at Kenya for their opposition to the ban's removal (PANA 18 Apr. 2000; see also ENS 14 Apr. 2000). Chipato retired from his position as Secretary of Mines, Environment and Tourism in 2000 (Financial Gazette 30 July 2003; The Herald 10 Apr. 2002).

In November 2001, Charles Chipato was listed as a member of the Board of Trustees of the Gold Mining and Minerals Development Trust (GMMDT), a trust that was established to improve Zimbabwe's production of gold and other valuable minerals and to stop "leakages" in the gold mining sector (Zimbabwe 8 Nov. 2001; The Herald 10 Apr. 2002). In April of the following year, Chipato was appointed Chief Executive of the GMMDT (ibid.). However, he resigned from the position in June 2003, a few weeks prior to investigations into alleged corruption of senior members of the organization (The Daily News 27 Aug. 2003; Financial Gazette 30 July 2003). Chipato claims his resignation was related to concern over the Trust's chairman and conflicts of interest regarding several of the Trust's projects; however, the chairman denied these allegations (The Daily News 21 Aug. 2003). Information on the outcome of the investigations into the alleged corrupt activities of GMMDT members could not be found among the sources consulted by the Research Directorate.

A 12 May 2005 article in the Harare-based Financial Gazette indicates that Charles Chipato served as a board member of the state-run telecommunications network, Tel*One (Financial Gazette 12 May 2005). However, the article does not provide details on his work at the company.

In 2007, Chipato held the position of board chairman of the National Oil Company of Zimbabwe (NOCZIM) (The Herald 25 July 2007; ibid. 2 Mar. 2006). Members of NOCZIM's board are apparently appointed by Zimbabwe's Minister of Energy and Power Development (The Herald 2 Mar. 2006). Information on the length of time Chipato has served as the NOCZIM board chairman could not be found among the sources consulted by the Research Directorate; however, one source consulted by the Research Directorate indicates that Chipato was the chairman in 2002 (ibid. 10 Apr. 2002). According to the Financial Gazette, NOCZIM is a state-run fuel procurement agency that has "over the years suffered the consequences of influence-peddling, top management ineptitude and malfeasance" (9 Sept. 2004).

In June 2007, Chipato was one of 27 Zimbabweans whose names were placed on a sanctions list in Australia in protest over Zimbabwe's abuse of human rights and lack of democracy (ZimOnline 21 June 2007; see also The Herald 23 June 2007). The list contains the names of 183 persons "closely linked" to Zimbabwe's government, including deputy ministers and officials of state-owned corporations (ZimOnline 21 June 2007; The Herald 23 June 2007). Persons on the list are banned from visiting Australia (ibid.; ZimOnline 21 June 2007). The United States (US) and several European countries have likewise imposed sanctions against senior Zimbabwean government officials (ibid.; The Herald 23 June 2007).

This Response was prepared after researching publicly accessible information currently available to the Research Directorate within time constraints. This Response is not, and does not purport to be, conclusive as to the merit of any particular claim for refugee protection. Please find below the list of additional sources consulted in researching this Information Request.

References

The Daily Mirror [Harare]. 24 February 2005a. Masimba Rushwaya. "Court Records Contradict President." <http://www.zimmirror.co.zw/dailymirror/view_news.cfm?storyid=11114&categoryid=9&issueid=383&issuedate=2005-02-24 19:29:00.0&issue_type=current> [Accessed 10 Oct. 2007]
_____. 24 February 2005b. "SMM Holdings Boss Fired." <http://www.zimmirror.co.zw/dailymirror/view_news.cfm?storyid=10768&categoryid=9&issueid=369&issuedate=2007-03-07%2019:59:00.0&issue_type=current> [Accessed 21 Feb. 2007]

The Daily News [Harare]. 27 August 2003. "Miners' Federation Probes Masuku." (AllAfrica/Factiva)
_____. 21 August 2003. "Ministry Condemns Gold Trust Proposals." (AllAfrica/Factiva)

Environment News Service (ENS). 14 April 2000. Barrack Otieno. "Whales, Elephants Divide Endangered Species Delegates." (Factiva)

Financial Gazette [Harare]. 4 April 2007. "South Africa: Mawere Takes Mbeki and Mugabe to Court." (AllAfrica) <http://allafrica.com/stories/200704050626.html> [Accessed 5 Oct. 2007]
_____. 12 May 2005. "TeleAccess in Market to Raise $150 bn." (COMTEX/Factiva)
_____. 16 September 2004. Felix Njini. "Govt Boots Out SMM Holdings' Entire Board." <http://www.fingaz.co.zw/fingaz/2004/September/September16/6527.shtml> [Accessed 21 Feb. 2007]
_____. 9 September 2004. Felix Njini and Njabulo Ncube. "NOCZIM Botches up." <http://www.fingaz.co.zw/fingaz/2004/September/September9/6454.shtml> [Accessed 10 Oct. 2007]
_____. 30 July 2003. "Probe into Gold Scam Launched." (AllAfrica/Factiva)

The Herald [Harare]. 25 July 2007. "Zimbabwe: Join Govt in Bio-Diesel Scheme – Mujuru." (AllAfrica) <http://allafrica.com/stories/200707240259.html?viewall=1> [Accessed 5 Oct. 2007]
_____. 5 July 2007. "Zimbabwe: SMM Holdings Loses Case Against State." (AllAfrica) <http://allafrica.com/stories/200707051371.html> [Accessed 4 Oct. 2007]
_____. 23 June 2007. "Australia Widens Sanctions List." (AllAfrica/Factiva)
_____. 17 January 2007. "SMM Saga – Mawere Contests Ruling." (AllAfrica/Factiva)
_____. 11 January 2007. "SMM Saga – Mawere Loses High Court Challenge." (AllAfrica/Factiva)
_____. 2 October 2006. "Mawere Liable for SMM Debts." (AllAfrica/Factiva)
_____. 31 July 2006. "High Court To Hear SMM's Application." (AllAfrica/Factiva)
_____. 2 March 2006. "New Noczim Board Appointed." (AllAfrica/Factiva)
_____. 10 April 2002. "Chipato Appointed Chief Executive of Gold Mining Development Trust." (AllAfrica/Factiva)

NewZimbabwe.com. 17 November 2006. Violet Gonda. "Mawere Gets Justice in UK Court." <http://www.newzimbabwe.com/pages/mawere19.13843.html> [Accessed 9 Oct. 2007]

Panafrican News Agency (PANA). 18 April 2000. Tervil Okoko. "Controversy Continues as Delegates Vote on Ivory Trade." (Factiva)
_____. 17 April 2000. "SADC Countries Defend Stand to Sell Ivory." (Factiva)

Pretoria News. 22 May 2007. Hans Pienaar. "SA Government Sued After Zim Nationalises Magnate's Empire." (Factiva)

The Washington Post. 24 February 2006. Nora Boustany. "A Zimbabwean Businessman, His Firms Seized, Takes on Mugabe." <http://www.washingtonpost.com/wp-dyn/content/article/2006/02/23/AR2006022302257.html> [Accessed 9 Oct. 2007]

Zimbabwe. 8 November 2001. Reserve Bank of Zimbabwe. "Launch of the Gold Mining and Minerals Development Trust." <http://www.rbz.co.zw/mrs/gold.asp> [Accessed 5 Oct. 2007]

Zimbabwe Independent [Harare]. 6 October 2006. "AAGM: Mawere Accuses State of 'Criminal Intent'." (Factiva)
_____. 2 June 2006. Mutumwa Mawere. "Seizure of Assets Raises Host of Issues." <http://www.thezimbabweindependent.com/viewinfo.cfm?id=3627&siteid=1&archive=1> [Accessed 21 Feb. 2007]
_____. 24 March 2006. Clemence Manyukwe. "Government Strengthens Repressive Instruments." <http://www.thezimbabweindependent.com/viewnifo.cfm?id=1703&siteid=1&archive=1> [Accessed 21 Feb. 2007]
_____. 18 February 2005. Dumisani Muleya. "Mugabe Remains Mum On Mawere Appeal." (Factiva)

ZimOnline.com. 21 June 2007. Nigel Hangarume. "Australia Imposes Sanctions on 27 More Mugabe Cronies." <http://www.zimonline.co.za/Article.aspx?ArticleId=1560> [Accessed 10 Oct. 2007]

Additional Sources Consulted

Oral Sources: The Zimbabwe Exiles Forum did not provide information to the Research Directorate within the time constraints of this Response.

Internet sites, including: Africa Intelligence, British Broadcasting Corporation (BBC), Contemporary Africa Databases, Crisis in Zimbabwe Coalition, European Country of Origin Information Network (ecoi.net), Kubatana Trust, New Zimbabwe, United Nations (UN) Environment Programme (UNEP), Zimbabwe Human Rights NGO Forum, Zimbabwe Information Centre.