Stanford Moyo, the former president of the Law Society of Zimbabwe told a workshop organised by the parliamentary portfolio committee on Mines and Energy last week that the law, which Zanu PF ministers want to use to grab foreign-owned companies defeated the whole purpose of empowerment.
“The Act gives freedom to choose a partner.
“However, according to the recently issued ministerial notice, one is compelled to sell to a designated entity,” Moyo said adding that implications of compulsory asset acquisition violated Section 16 of the constitution.
He said the law would ultimately empower the State rather than the ordinary people whom its promoters claim it was created for.
“Another aspect overlooked is that there is no mechanism for determining the indigenous identity of the owners of shares held by a nominal company,” he said.
Section 19 of the Act allows the minister to inspect the share register but cannot see who the ultimate beneficiaries of the shares are, while Section 115 of the Companies Act allows an individual to inspect the share register without identifying actual beneficiaries.
“Under Section 62 of the Securities Act, the Securities Commission can find out who the beneficiaries are but it is not entitled to release shareholders’ identity unless it is in the public interest, leaving the Act open to litigation,” he said.
Moyo said it was also difficult to determine whether black and white locals are indigenous or not.
But Youth, Indigenisation and Empowerment minister Saviour Kasukuwere insisted government must be allowed to choose partners for the foreign companies to prevent a minority from benefiting.
“We need an inventory of who the proposed partners are, we cannot have the same names appearing (in the indigenisation proposals),” Kasukuwe-re said.
Government initially set May 9 as the deadline for foreign-owned mining companies to submit their proposals on how they will comply with the new law but has since extended the deadline to June 2.