Zimbabwe: RBZ Penalises Nat Foods, 17 Companies for Violating Auction Rules

The Reserve Bank of Zimbabwe (RBZ) is set to penalise 18 companies, including food processing giant National Foods, for violating the Foreign Exchange Auction regulations.

The move comes amid plans to stamp out all forms of indiscipline choking the recovery of the economy.

The development comes shortly after President Emmerson Mnangagwa issued Statutory Instrument 127 of 2021 which directed all companies to peg their products, and services using local currency prices at the obtaining official exchange rate.

In a statement Tuesday, RBZ governor John Mangudya said recent findings by the Financial Intelligence Unit (FIU) had exposed 18 deviant companies.

"Accordingly, after investigations by the Financial Intelligence Unit and the Bank's Exchange Control Division, the entities listed hereunder which were abusing the foreign exchange auction system shall be dealt with in accordance with SI 127," he said.

The list includes; National Foods, Georgia Petroleum, Tettola Investments, Africa Steel, Westvillle Investments (T/A) Omni Africa) and Flicknik Enterprises among others.

However, the nature of the violations and the penalties to be enforced were not disclosed.

"Going forward and in line with the recommendations from the business community on the need to continue to enhance stability in the economy, the Bank's efforts to foster compliance in terms of SI 127 shall be limited to outliers that wantonly abuse the foreign exchange auction system, exchange rate manipulation and noncompliance with anti-money laundering rules and regulations," Mangudya said.

The RBZ boss said the central bank's duty is to ensure that the significant progress the economy made since the introduction of the Foreign Exchange Auction System in June 2020 continued unabated.

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