SMMHZ was seized from businessman Mutumwa Mawere via the Reconstruction of State Indebted and Insolvent Companies Act (Reconstruction Laws and Regulations) which deemed his companies indebted to the state by owing parastatals.
SMMH was deemed to be indebted to the State by virtue of owing money to the central bank (Z$30 billion), a Z$252 million debt to the National Social Security Authority, Minerals Marketing Corporation of Zimbabwe (Z$396 million), Zimbank (Z$20 billion), Zesa (Z$8,2 billion) and owing the tax collector, Zimbabwe Revenue Authority of Z$49 billion.
In a letter dated November 9 2011, Mawere’s lawyers, Kyle Attorneys, wants Mpofu to disclose the identity of the said institution “who you allege has taken up ownership of, or became the registered shareholder of SMMHZ and advise on what basis of law or circumstance, the said institution became the lawful owner of or registered shareholder of SMMHZ”.
The lawyers want Mpofu to furnish them with a written undertaking that he would not instruct the Zimbabwe Mining Development Corporation (ZMDC) to implement the proposed takeover of Shabanie Mashava and African Associate (AA) Mines. Mpofu is also expected to make an undertaking that mining activities at the mines should not take place until he says who the lawful owner of SMMH is.
Early this year government transferred Mawere’s empire, under reconstruction, to Mpofu’s ministry from Patrick Chinamasa’s authority as Minister of Justice and Legal Affairs.
ZMDC has so far ordered an audit and has promised to pay the mine workers who have been unpaid in the past two years. The latest correspondence is a follow up to earlier letters written to ZMDC board chairman Godwills Masimirembwa who said that ZMDC was neither the owner nor registered shareholder of SMM, but was only a statutory body taking instructions from Mpofu.
Mawere is fighting to reclaim his empire arguing that SMMH is owned by SMMH (UK) and that government failed in its attempt to be registered as the shareholders by UK courts.
Parliament has also given Mawere a ray of hope after calling for a review of the reconstruction laws arguing that such legislation exposes citizens to the risk of losing assets to the state without meaningful judicial oversight.
In a comprehensive report to parliament, the portfolio committee on Mines and Energy urged a cautious look at the legislation. “A law that arbitrarily converts claims of state-owned institutions to state obligations governed under the reconstruction laws has to be carefully examined and interrogated by the House,” it said.