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ZCCM-IH: Legal update on KCM

MINING Minister Richard Musukwa says the activities of KCM’s interim liquidator, Milingo Lungu, within the mining company are in accordance with and comply with the provisions of the law.

And Musukwa reiterated that a number of investors are aligned and interested in partnering with ZCCM-IH to exploit KCM once the ongoing arbitration processes have been exhausted.

Musukwa told parliament on Tuesday when he responded to a written question from Nchanga PF MP Chilombo Chali, who wanted to know the status of KCM’s interim liquidation process from July 2020; whether there has been an arbitration process between Vedanta Resources and ZCCM-IH in South Africa, and what effect the outcome of the arbitration process would have on the liquidation process in Zambian courts.

“The government will present a full statement on the liquidation of KCM at an appropriate time [and] at the instance of the President (Dr Patrick Matibini). So far, in August 2019, Vedanta appealed the High Court’s decision to dismiss the request to stay the liquidation proceedings and to refer the case to arbitration. As a result, the proceedings were stayed, pending the decision of the appeal. ZCCM-IH Investment Holdings also appealed the court’s decision to stay the proceedings. In August 2020, the said appeal was heard and we are awaiting the decisions of the court of appeal. The arbitration process between Vedanta Resources and ZCCM-IH began in July 2019 and is still ongoing in South African courts. The parties have agreed on the sole arbitrator to hear and determine the procedure. The outcome of this case is up to the court and therefore we are unable to indicate the effects, if any, until the courts make a decision. Since the liquidation process is a court case, only the court can determine the dates on which it will be concluded, ”Musukwa replied.

Asked by Monze Central UPND MP Jack Mwiimbu about what Milingo was doing at KCM if he did not sell the assets to pay off the debt, Musukwa argued that he was acting within the law.

“What the current liquidator at KCM is doing is in accordance with the law. As you know, the liquidation follows the example of the minority shareholder, who expressed doubts about how the large shareholder treated and ran the company. So, at present, what is happening is that while waiting for these legal proceedings to be accelerated and completed, KCM’s operations are continuing and the liquidator is managing by repaying his debts, both to suppliers and to suppliers. current entrepreneurs, and the operation is supported, ”Musukwa replied.

And Serenje MP MMD Maxwell Kabanda asked Musukwa what exit strategy he had in place to compensate KCM workers who may be affected in the event the court rules against the government.

But in his response, Musukwa said the government remains confident it has a strong case against Vedanta.

“Mr. President, we started the liquidation process because we were very confident that we had a solid case against Vedanta. And we were very confident that, in accordance with the rules of natural justice, the Zambian people and the workers of Nchanga, Konkola, Nampundwe and Kitwe have a better case in this regard. And in the event that this matter is not in their favor, the Government of the Republic of Zambia reserves the rights in terms of the appeal process using the judicial process because, as you know, we are a government of laws and we will make sure that we fight this process anchored in the force of law. And we are convinced that we have a better case to be successful in court, ”he replied.

Meanwhile, Musukwa reiterated that a number of investors were lining up and interested in partnering with ZCCM-IH to exploit KCM.

“We are optimistic, as a government, that we will win this case. And once this matter is settled quickly, we will make sure to address the issues relating to the welfare of the workers. His Excellency the President of the Republic of Zambia has guided that one of our priorities is to ensure that we ensure the well-being of workers and that we serve in this process. We have a number of investors who are aligned and interested in partnering with ZCCM-IH and managing and operating this mine. The government is not in the business of managing the mine. We would like to focus on the po orientation

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