The President’s letter comes hardly a week after Finance, Planning and Economic Development Minister Matia Kasaija and the Deputy Attorney General Mwesigwa Rukutana clashed over the removal of Bemanya.
KAMPALA - President Yoweri Museveni has directed the Justice and Constitutional Affairs Minister Kahinda Otafiire not to renew the contract for the administrator of the Uganda Telecom Limited (UTL) Bemanya Twebaze on grounds that he has been fighting the State Minister for Investment and Privatization, Evelyn Anite.
In a letter dated November 9, 2019, to Otafiire, Museveni noted that "I have received your letter of November 6, 2019, about the administration of UTL whose time is expiring but you want to renew the contract. Bemanya is always in conflict with Minister Anite. Anite is one of the very active Baijukulu. In the interest of cohesion, get another administrator. Going on with endless tension is not good for management," Museveni directed.
The President's letter comes hardly a week after Finance, Planning and Economic Development Minister Matia Kasaija and the Deputy Attorney General Mwesigwa Rukutana clashed over the removal of Bemanya.
The Ministry of Finance, in a resolution dated November 8, 2019 noted that an extraordinary general meeting of UTL held in it's boardroom resolved that "the administration of UTL be extended for a further period of one year effected from November 22 to facilitate completion of the audit process by the Auditor General as per the order of court and identification and engagement with potential investors to invest in UTL."
The resolution also noted that, "a new administrator be obtained in accordance with the law following the lapse of the current administration's tenure on November 22, 2019, and that the Registrar of Companies be notified."
However, Rukutana insisted that the Ministry of Finance did not have powers to remove Bemanya from UTL since his appointment was a matter of the courts.
Bemanya was appointed as UTL administrator in March 2017 after the exit of UCom Limited a Libyan firm that owned 69% shares.
In August this year, President Yoweri Museveni directed state Minister for Investment Evelyn Anite to institute an audit in the UTL after hearing some allegations but did not disclose the nature of the allegations he had received.
"This is to direct you to institute an audit in the activities that are going on in the Uganda Telecommunications Limited. I have heard some allegations. The audit should clear them or confirm them," the President stated.
The Presidential directives contravened an earlier position given by both the Attorney General William Byaruhanga and his Deputy Mwesigwa Rukutana in which both noted that there cannot be an audit of the administrators' activities in Uganda Telecom Limited until the administration process elapses. The AG's office asked the Finance Ministry to back off UTL administration and reiterated that the ministry has no control over the company in the current status.
The AG quoted Section 174 (1) of the Insolvency Act, which provides that only listed creditors are competent to apply to court to remove the Administrator from Office, the AG noted that, "The Minister of Finance as a shareholder of UTL cannot apply to court to remove the administrator and any such application is bound to fail."
The AG decision follows Anite's letter on June 26, 2019, which asked the Attorney General to apply to the court for orders replacing Bemanya Twebaze the current administrator of UTL. Anite stated in her letter that the government had encountered considerable difficulty dealing with the Administrator and completely lost confidence in his ability to continue serving the role of UTL Administrator.
Anite said that the government, which is the only shareholder has absolute powers to take decisions on behalf of the Company in accordance with the Insolvency Act and Regulations. She also noted that the Government was the biggest creditor of UTL with over 207 billion Shillings.
"In effect, a decision has been taken to remove Bemanya Twebaze, official receiver as the current Administrator and to immediately replace him with an individual that we will indicate," reads part of Anite's letter in which she requests the Attorney General to urgently apply to the court to replace the current Administrator.
The Insolvency Act provides for the vacation of the office of administrator providing that the office of the administrator shall become vacant where the person holding office is removed from office or where the administrator resigns, dies or becomes unqualified to act as an insolvency practitioner.
"I will be pleased to swear an Affidavit to support the Application where the supporting reasons will be elaborated. I implore you to have the petition filed without any delay to ensure that the Administration of the Company progresses without any issue," Anite wrote.