22 September 2017

South Africa: Gigaba Says SAA's Myeni's Contract Is Legal

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(file photo).

Finance Minister Malusi Gigaba has told Parliament's standing committee on finance that South African Airways chairperson Dudu Myeni's extended contract is legal.

This comes after the Companies and Intellectual Property Commission (CIPC) said her extended tenure in September was illegal, according to its laws.

"The minister argues that it is legal to extend Ms Myeni's term on the basis of Section 13.4.6 of the SAA Memorandum of Incorporation, which he says is in line with the Companies Act," Yunus Carrim, chair of the standing committee of finance, said in a statement on Friday.

Carrim told Fin24 on Thursday evening that he had received Gigaba's letter and was sending it to parliamentary Advocate Frank Jenkins.

"We have referred the minister's correspondence to our parliamentary lawyer and will discuss the matter in the committee meeting on October 5," Carrim said.

"The committee had raised a concern about the fact that the minister extended Ms Myeni's term until the SAA annual general meeting (AGM), which is scheduled for November 3. However, the minister said that Ms Myeni has not yet served three full terms of office."

Response is incredible - Lees

DA MP Alf Lees, who is on the committee, said he has yet to receive the correspondence from Gigaba.

"It seems incredible that the legal advice can contradict the position of the commissioner of the CIPC as well as all members of the finance committee," he told Fin24 on Friday.

Furthermore, Lees criticised Carrim's conduct, because he did not send Gigaba's correspondence to all committee members.

"It is extremely disappointing that Yunus Carrim, in his capacity as chair of the committee, appears to be playing politics with the response from the minister of finance to a committee resolution," he told Fin24. "The reasons given by the minister should have been distributed to all members of the committee and not just held to himself."

Carrim's phone was turned off and so could not respond to queries on the matter.

Last week, all members of the committee thought Myeni's extension was illegal and that Myeni should leave the board with immediate effect. They had given Gigaba seven days to provide legal reasons why her stay was legal.

Jenkins will now have to weigh up the legal arguments before the October 5 meeting, where the committee will make a decision regarding Gigaba's response.

Remove Myeni with immediate effect - Lees

On Thursday, Lees called for Gigaba to remove Myeni with immediate effect.

"The DA wrote to the commissioner of the CIPC and received confirmation that Dudu Myeni's continued appointment as SAA board chairperson and a director is deemed to be illegal," Lees said in a statement on Thursday.

"Finance Minister Malusi Gigaba therefore has no choice but to fire Myeni. We have written to Minister Gigaba to confirm what he has done to ensure that Ms Myeni no longer occupies these positions.

"Point 2.3 of the CIPC commissioner's letter to Gigaba clearly states that 'Ms Myeni's continued occupation of the position of director and Chairperson of the Board of SAA is deemed to be illegal.'

"This confirms our belief that Ms Myeni ceased to hold these roles at the end of August 2017 and that any decisions taken by the SAA Board since then are null and void and may not be implemented," said Lees.

Source: Fin24

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