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DISMISSED: The Bank of Namibia suffered a second set back in an exchange control case after the Supreme Court ruled against favour.
DISMISSED: The Bank of Namibia suffered a second set back in an exchange control case after the Supreme Court ruled against favour.

Central bank loses exchange control case on appeal

Another setback
The Supreme Court has upheld the ruling issued by the Windhoek High Court last year.
Ogone Tlhage
The Bank of Namibia (BoN) lost an exchange control case on appeal against several northern-based retailers in the Supreme Court last week.

In June last year, High Court judge Shafimana Ueitele set aside a decision by BoN and senior exchange control official Penelao Kapenda to freeze the bank accounts of several companies from the Rani Group of Companies, noting that Kapenda lacked the authority to freeze the companies' bank accounts.

In its reasoning, the Supreme Court said the High Court at the time of the ruling was correct to find that there is a rebuttable presumption against sub-delegation.

This meant that the power delegated does not automatically include the power to delegate further.

“Whether the delegated powers can be further delegated depends on the context in which the initial delegation took place and whether it is such as to rebut the presumption against further delegation,” the judgment reads.

Mandate

The Supreme Court determined that the finance minister gave certain powers and responsibilities to the Bank of Namibia. These powers can only be carried out by the board or the governor, and neither of them can pass these powers on to anyone else.

“There are no provisions in either the Bank of Namibia Act 8 of 1990 or the Bank of Namibia Act 1 of 2020 which allow BoN to vary the mandate conveyed to them in the delegation from the Minister of Finance unilaterally,” the judgment notes.

In 2023, Kapenda received an anonymous tip-off alleging that the businesses under the Rani Traders group were unlawfully dealing in foreign exchange by receiving and depositing foreign currencies into their bank accounts without proper authorisation.

Following this tip-off, Kapenda initiated an internal investigation and covert operations, which led to the decision to block the applicants' bank accounts.

Chief justice Peter Shivute, judge president Petrus Damaseb and Supreme Court judge Theo Frank issued the ruling in favour of the Rani Group's retail outlets.

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Namibian Sun 2025-02-18

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